Silver Lake Resources (ASX: SLR) has given the tick of approval to the Santa underground mine development at the Mount Belches Mining Centre in WA’s Eastern Goldfields.
Silver Lake Managing Director Luke Tonkin said Santa will increase the available shallow, high-grade ore sources at Mount Monger and add to the growth potential within the 25km of prospective BIF horizons controlled by Silver Lake in the Mount Belches region.
Santa will be the third, shallow, high-grade underground mine at the Mount Belches Mining Centre and is located within 4km of established Mining Centre infrastructure at Maxwells and is only 22km east of the Randalls gold processing facility.
Mr Tonkin said Santa’s proximity to established mines and infrastructure at the Mount Belches Mining Centre captures operational synergies including utilisation of Silver Lake’s existing mine management team, services infrastructure, and incumbent mining and haulage contactors.
The maiden Santa Ore Reserve of 257kt at 3.5 g/t for 29,000 ounces1 declared in August 2019 represents a production area immediately beneath the base of the Santa North pit floor in the Santa West Limb.
The Santa Area has a broader Mineral Resource of 5mt at 2.8 g/t for 454,000 ounces and with drilling continuing at Santa the conversion of Mineral Resources to Reserves is considered likely.
Development will require a very modest pre-production capital investment of $2.1 million to establish underground access and site services, with a further $2.0 million in underground infrastructure.
Construction activities are expected to take just two months and underground mine development is expected to commence in 4Q FY20. Mine production from Santa will deliver approximately 1,800 ounces in FY20 and 26,000 ounces in FY21.
Target production from the Mount Belches Mining Centre is expected to increase to 70,000 – 75,000 ounces per annum with three operating mines.
