Rumours of new gold beneath Kalgoorlie

A new gold discovery underneath Kalgoorlie will be grist for the rumour mill at the annual Diggers and Dealers conference, despite KCGM’s refusal to confirm or deny if it is true.

Superpit operator Kalgoorlie Consolidated Gold Mines (KCGM) and part owner Newmont Mining refused to confirm talk that drilling by a private subcontractor made a discovery which lies directly underneath Hannan Street, just behind the Kalgoorlie Primary School.

The West Australian reported the discovery has been privately touted as a “game changer” by industry insiders.

If true, the new discovery will extend the Superpit’s mine life, a very positive development during a period which many understood would be the final days of the operation, as it exhausts known resources and processes old tailings.

Kalgoorlie-Boulder deputy mayor Allan Pendal said the local council was aware of the rumours, and would be supportive of a new mining development beneath the town if there is a minable deposit, which would be the closest to the town centre that mining activity occurred.

“This is certainly the furthest west that any discovery has been made in the town, most of the mining close by has been at the northern end of town,” he said.

Pendal said he did not believe there would be any adverse effects on buildings in the town due to close mining activity.

“It’s my understanding that the discovery is quite deep," he said.

“Many of the buildings in that area are around 150 years old, and would have been subject to a lot of mining activity in the past, so they would certainly be able to sustain that kind of activity.”

Newmont Asia Pacific regional senior vice president Tom Palmer is expected to address the Diggers and Dealers conference today, and will certainly face questions about the rumour.

It is understood that a private syndicate which drilled the discovery includes former stockbroker and mining industry veteran David Reed, who is subject to a confidentiality agreement with KCGM.

The exploration hole in question was sunk 1400m from behind the local primary school, at a cost of more than $300,000, and is said to have found significant mineralisation at a depth of one kilometre.

Others involved in the syndicate include the families of explorer Kevin Pownall and Goldfields geologist Steven Tomich, who passed away since formation of the syndicate in 2010.

Mayoral candidate and former state resources minister John Bowler said KCGM and Newmont should be “good corporate citizens” and exhibit greater transparency about their plans.

“If they were an Australian company they would have to release them under the rules of the stock exchange,” he said.

“I’m not saying KCGM has to say whether or not they will mine the prospect — just let us know the results.”

Image: ABC

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.