RNC Minerals Corp. [RNX-TSX] said Friday August 23 that it has begun mining at its Baloo Stage 1 open pit, a project that is expected to supply feed to the mill at RNC’s Higginsville Gold Operations (HGO) in Western Australia.
RNC said the Baloo Stage 1 open pit (located on the HGO property) is the first of a series of open pits that the company is looking to put into production in a bid to maximize owned source feed for the HGO mill, which will also be used to process material from the company’s Beta Hunt Mine.
The fully funded and permitted Baloo Stage 1 pit is expected to provide the HGO mill with approximately 30,000 tonnes of feed per month until the end of 2019. The Baloo material that has been processed so far has grades ranging between 1.8 to 2.8 g/t gold.
“The commencement of processing of Baloo material through the HGO mill is another big step forward in the transformation of RNC into an integrated multi-mine gold operation and supports our belief in the quality of the resource potential of the nearly 400 km2 HGO land package that we acquired and the growth trajectory of the combined Western Australia operations,” said RNC Chairman and CEO Paul Andre Huet.
“We are looking forward to providing production and cost guidance for the balance of 2019 in the near future,” Huet said.
RNC’s key asset is a 100% interest in the producing Beta Hunt gold mine. RNC attracted international attention last year following news of a once-in-a lifetime gold strike in the Father’s Day Vein at Beta Hunt. The company said it had extracted 9,250 ounces of gold, worth $15 million, from a 130-tonne cut of rock about 500 metres underground at the mine.
The find included a single 95-kilogram chunk that contained 2,400 ounces of gold, worth about $3.8 million. A second 62-kilogram stone contained 1,620 ounces.
RNC recently announced a five-fold increase in measured and indicated resources in the Western Flanks Zone at Beta Hunt, which now stand at 720,000 ounces of gold. On top of that is an inferred resource of 250,000 ounces. On the basis of these new estimates, RNC said it plans to resume full scale production at Beta Hunt in the third quarter of 2019.
Higginsville is located 57 km south of the Beta Hunt operation and 107 km south of Kalgoorlie. It includes a 1.3 million-tonne processing facility, a historical mineral resource of 1.9 million ounces, 370,000 ounces of gold reserves and 386 km2 of tenure with gold mineralization potential.
RNC’s other key asset is a 28% interest in a nickel joint venture that owns the Dumont Nickel-Cobalt Project in the Abitibi region of Quebec. This property contains the second largest nickel reserve and ninth largest cobalt reserve in the world.
On Friday, the company said the first material from Baloo Stage 1 was mined in early August, 2019 with the first mineralization being uncovered at a depth of only 3 metres. RNC said a reinterpretation of historical drill holes has highlighted the potential to extend the Baloo pit further north beyond a large NE-SW fault that was previously thought to terminate the mineralization.
A systematic review of the entire HGO resource inventory with a focus on areas that could provide feed to the mill, in a similar fashion to Baloo 1, is well underway, RNC said.
On Friday, RNC shares rose 2.29% or $0.01 to 44.5 cents. The shares are currently trading in a 52-week range of $0.075 and $1.18.