Kalamazoo Resources plans to exploit the greenfields and brownfields potential of the Ashburton gold project that it has acquired from Northern Star Resources in Western Australia.
The company purchased the project from Northern Star Resources for $17.5 million earlier this week.
Exploration will begin immediately through a team led by Kalamazoo’s Western Australia based director Paul Adams.
“I am delighted to now have the opportunity of leading our first-class exploration team at Kalamazoo as we look to develop this project further. The upcoming discovery phase will be very exciting as we work to substantially increase the current 1.65Moz resource and investigate development options,” Adams said.
To date, the Ashburton gold project has produced 350,000 ounces of gold, with the current mineral resource estimate being 20.8 million tonnes at 2.5 grams of gold for 1.65 million ounces.
Kalamazoo chairman and chief executive officer Luke Reinher said the acquisition of Ashburton further cements the company’s position in two of Australia’s best gold exploration regions, adding it to the company’s range of gold assets across the Victorian Goldfields and Western Australia’s Pilbara region.
“We are delighted to have acquired this major exploration project with its 1.65 million ounce gold resource from Northern Star,” he said.
“This is a tremendous outcome for our shareholders and an outstanding addition to our prospective portfolio of gold projects in the Pilbara. Kalamazoo is in the unique position of having major assets and tenure in two of the most highly rated gold exploration provinces in the world today – the Victorian Goldfields and the Pilbara.”
The Ashburton Gold Project began operations under Sipa Resoures in 1998, who entered farm-in and joint venture agreements with Newcrest.
Northern Star acquired the project in 2011, but yesterday claimed it does not fit with their portfolio of operations.
The company was able to expand Ashburton’s resource inventory from 668,000 ounces to 1.65 million ounces between 2011 to 2013.
“The Ashburton Project no longer fits in Northern Star’s portfolio but still has strong potential on both the exploration and production fronts,” Northern Star executive chair Bill Beament said yesterday.