Bellevue Gold (ASX: BGL) has advised that the strategy to increase its forecast production rate has been strengthened further by an 11 per cent increase in total Resources to 3.0 million ounces at 9.9g/t.
The total Resource has now increased by 25 per cent since the Stage 1 Feasibility Study in February 2021. The Indicated Resource of 1.4Moz at 11.0g/t is up from 1.0Moz at the time of the study.
Since the maiden 0.5Moz Resource was announced at the project in August 2018, the Resource has grown at a compound annual growth rate of 84%.
The increased inventory will form the basis of the Stage 2 Feasibility Study scheduled for release later this quarter.
The new study will consider the option of increasing the production plant capacity from 750,000tpa to 1Mtpa. This expansion is expected to incur minimal additional capital expenditure but have a material impact on the project’s economics.
The increased Resources and work on the expanded Feasibility Study come as Bellevue prepares to compile a shortlist of the project debt funding proposals it has received from several lenders.
Bellevue Managing Director Steve Parsons said the project was making outstanding progress on every front.
“We are advancing, growing and de-risking the project at the same time,” Mr Parsons said. “This substantial Resource increase means we have ticked an important box in our strategy to grow the forecast production rate by expanding mill throughput to 1Mtpa.
“Given the surplus capacity built into the Stage 1 Feasibility Study, we believe we can achieve this expanded throughput rate for minimal additional cost.
“This means we stand to generate increased free cashflow from the higher production rate and greater economies of scale, which in turn should increase the overall project economics significantly.
“The strong outlook for the project is also demonstrated by the highly favourable indicative proposals we have received from lenders. We expect to compile a shortlist of lenders in coming weeks.”
The Bellevue Gold Project Resource has been updated to include drilling completed between the cut-off date for the Feasibility Study in November 2020 and mid-June 2021. The revised estimate reflects the upgraded Marceline/Deacon North and Deacon Lodes which have been the subject of extensive surface and underground diamond drilling programmes during the first half of 2021. Minor changes have also been incorporated at Deacon Main to update the interaction with the alphabet faults.
Significantly the combined areas of Marceline and Deacon North now total 0.8 Moz at 8.8 g/t including 0.4 Moz @ 9.9 g/t of Indicated category. Preliminary engineering studies indicate the area will be accessed by a new northerndeclinewhich will allow mining to progress simultaneously from both ends of the Deacon Lodes’ 2.2km of strike.
Development access to the Marceline Area has already commenced with a second heading now being developed to the north to provide access to the Marceline and Armand area with over 120m of decline development already completed, as the southern decline refurbishment continues. Over 2,300m of underground development has now been completed to a vertical depth of 200m below surface.
With the Resource upgrade to Marceline and Deacon North, the Deacon Structure is now host to 1.28 Moz @ 10.0g/t including 0.69 Moz @ 11.6 g/t of Indicated Resources. Further drilling is continuing along the Deacon structure from surface and underground targeting further Resource growth and reserve conversion.
Since the cut-off for the Feasibility Study 1 in November 2020, the Company has continued to grow the Resource at ~75,000 ounces per month. Drilling is ongoing with five surface diamond rigs continuing with an additional two underground rigs operating. Another underground rig will be arriving on site later this year. During the next 12 months as project development progresses, drilling will focus on grade control drilling of early mine areas, further Resource conversion to grow the project reserves and step out exploration growth.
The current update has been independently estimated and is based entirely on high quality, oriented diamond drilling at the new discoveries.
