Saracen sees mine life growth

SARACEN Mineral Holdings has made a strong start to its A$50 million 2020 financial year exploration program.
Saracen sees mine life growth Saracen sees mine life growth Saracen sees mine life growth Saracen sees mine life growth Saracen sees mine life growth

Examining core at Carosue Dam

The company said the initial results from its Thunderbox and Carosue Dam mines in Western Australia's Goldfields region highlighted the potential for reserve and mine life growth.

At Carosue Dam, thick high-grade results included 51m at 8.5 grams per tonne gold; 24m at 14.3gpt gold and 33m at 6gpt at Karari, and 20m at 4.6gpt gold; 21m at 4.5gpt gold; and 26m at 3.5gpt.

At the pre-resource Atbara discovery, 4km from the Carosue Dam mill, results included 139m at 1.1gpt gold, and 127m at 1.3gpt.

Results of a 3D seismic survey are due by the end of the year.

Regionally, aircore drilling identified a strong anomaly south of the Okavango prospect, with grades of up to 1640 parts per billion gold.

At Thunderbox, the A Zone underground returned 89m at 2gpt gold and 72m at 2.4gpt, while the D Zone open pit returned 86m at 1.7gpt gold and 72m at 2.4gpt.

The 60,000 ounce Otto Bore deposit returned 8m at 27.2gpt gold, 13m at 7.8gpt gold and 16m at 6.1gpt.

Saracen spent $56 million on exploration in FY19 to grow its reserves from 2.5 million ounces to 3.3Moz at a cost of $30 an ounce. It is targeting 4Moz in reserves in the next four years.

The company has already spent $16 million of this year's budget in the September quarter.

Saracen managing director Raleigh Finlayson said the company's organic growth strategy was delivering exceptional returns.

"There is still immense potential to grow production and mine life at our assets, which also allows us to capitalise on our existing infrastructure," he said.

"This combination of extremely low discovery costs and access to existing infrastructure ensures we generate outstanding returns on our capital, which is our overall objective."

Saracen's reserves underpin a seven-year production outlook at 400,000oz per annum.

Guidance for FY20 is 350,000-370,000oz at all-in sustaining costs of $1025-1075 an ounce.

Shares in Saracen dropped 0.9% to $3.38, valuing the company at $2.8 billion.