ABM Resources has announced it will cease operations on its Old Pirate gold mine in April, affecting 100 jobs.
It came after the miner carried out a review of its mining plans and performance at the site.
According to the ABC the miner forecast grades of 11 grams per tonne, but "once mining got underway the gold grade was averaging at 7 to 8 grams per tonne of ore," ABM CEO Brett Lambert said.
"It's been very disappointing for everyone associated with the company that Old Pirate has closed earlier than anticipated,” he told the ABC.
“A study was carried out to re-optimise open pit designs, revise mine plans and update production forecasts using operational data acquired since mining commenced,” ABM explained in a company statement.
“The main objective of this study was to improve overall economic performance by excising underperforming areas from the mine plan and, where possible, expand mining in areas of the deposits that were performing well.”
“The re-optimisation study did not result in significant modification of the original pit designs for Old Pirate. It was concluded that cutting back the walls on any of the pits to extend mining at depth was not economically viable under current operating conditions.
“A revised mine plan and production forecast were prepared with mining and processing, including the recovery of gold in circuit, now scheduled to be completed by the end of April 2016,” the miner said.
“Rehabilitation of the Old Pirate mine site continues to be carried out concurrently with mining and is expected to be largely complete by the end of April 2016, when all mining equipment, leased infrastructure and accommodation will be demobilised.”
This decision is expected to affect around 100 full time workers and contractors.
However the company will continue exploration activities in the area, and will reconsider operations at Old Pirate “if a larger scale, lower cost processing option can be established or otherwise accessed”.