Mitchell Services has secured a $33 million drill and blast contract at Adaman Resources’ Kirkalocka restart project in Western Australia.
Adaman, which acquired the Kirkalocka gold operation in 2018, has completed a bankable feasibility study (BFS) and secured $55 million in project funding ahead of planned restart to production at the site in the December quarter.
Kirkalocka mining services provider, SMS Innovative Mining, awarded the contract to Mitchell.
The agreement will see Mitchell initially deploy two rigs, with a third one potentially coming on board later this year.
According to Mitchell Services, the contract represented the company’s entry into the drill and blast production drilling market.
“This is a service offering that we are strategically focused on growing, and the award of this contract provides an ideal platform to do so,” Mitchell Services chief executive Andrew Elf said.
“It also continues to expand our footprint within Western Australia, adding both service and geographic diversification.”
Previous Kirkalocka owner, Equigold, placed the operation into care and maintenance a decade ago when the company merged with Lihir in 2008.
The project has since changed hands to Mt Magnet South (2009) and Minjar Gold (2013), before falling into Adaman’s ownership.
Adaman is also upgrading Kirkalocka’s carbon-in-pulp gold processing plant to two million tonnes as part of the plant refurbishment.
The Kirkalocka project, which is centred on the Curara Well gold deposit, produced 283,000 ounces at an all-in sustaining cost of $476 an ounce over six years of operation.