Matsa Resources plans to restart mining at its Red October gold project in Western Australia following a geological review.
The company purchased the operation from Saracen Minerals in September last year for $2 million in cash and shares. Red October has been in care and maintenance since June 2017 with equipment in situ, so the potential for a restart represents a significant development for the company.
In April, the company entered into a memorandum of understanding with Pit N Portal Mining Services (PNP), where they would conduct underground studies and development at the Red October gold project.
Stage one of the agreement was expected to be completed by April 20 but has since had its scope increased due to encouraging preliminary results at the underground resource model— 85,000oz of gold at 13.6g/t — with 15 areas identified as potential near-term mining areas, and another 12 identified outside the existing resource model.
Current open pit totals at Red October stand at 14,000oz at 1.7g/t, adding up to total indicated and inferred project resources of 99,000oz at 6.9g/t.
Matsa executive chairman Paul Poli was happy with the results so far.
“I am delighted that the initial geological review provides substantial encouragement to continue investigations towards mining in the near term,” he said. “I continue to look forward to working with PNP over the coming months to commence mining at Red October.”