Despite the gold price drop, Regis Resources is forging ahead with a plant production expansion at its Duketon project near Laverton.
Regis’ board has signed on to the $20 million stage 2 plant expansions at the Rosemount gold project. Operating cashflow will finance the venture.
The company said the expansion would bring combined mill throughput from its Garden Well and Rosemont projects growing from 6.5 million tonnes a year to 7.5-8 million tonnes a year.
“This should result in a long term production rate for the Duketon Gold Project in the order of 410,000-430,000 ounces of gold per annum at a cash cost (prior to royalties) of between $630-$680 per ounce,” the company said in a statement.
The stage 2 expansion will begin after stage one is completed in September and it should finish in the June 2014 quarter, The West Australian reported.
The Rosemont project will be developed as a crushing and grinding circuit at the Rosemont pit with ground ore product to be pumped to the Garden Well circuit at 1.5mtpa for leaching and gold production.
“It has been determined that the optimal approach is to build the balance of a full progressing plant for the Rosemont project (Rosemont stage 2) to maximise the plant throughput capacity,” the company said.
New facilities for this include lime silo, gravity circuit, leaching circuit, elution circuit and gold room, and reagents storage and distribution systems.
The gold sector has taken a battering in the wake of price slump, with Apex Minerals recently going into administration.
The company announced in a statement 'following an urgent review of available cashflow' the decision has been made to 'immediately transition Wiluna mine to care and maintenance'.
Barrick Gold recently sacked 55 workers in Utah and Nevada.
Regis said it produced 72,134 ounces (2044kg) of gold in the June quarter, and it is still seeing a host of production issues at its Garden Well project.
It revealed it will upgrade Garden Well’s resource from 2.29 million ounces to 3 million ounces and its reserves from 1.39 million ounces to 1.7 million ounces.
It also said that due to the lower gold price it will run at a fully franked dividend payout ratio of 15 per cent instead of 20 per cent.
Kingsgate Consolidated announced job cuts at its Challenger gold mine as it wants to implement a new mine plan to reduce operating costs by up to 30 per cent.
Alacer Gold also revealed its intention to sell off its Australian assets to concentrate on its gold mining ventures in Turkey.
The company’s annual profit results in September will reveal the full-year dividend, as decided by the board.
Shares were up 22 cents, or 6.73 per cent, to $3.50 before close.