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Bellevue Gold new high-grade results point to more resources, extended mine life and enhanced production rate

Published: 20:09 20 Sep 2021 EDT

Bellevue Gold Ltd - Bellevue Gold new high-grade results point to more resources, extended mine life and enhanced production rate

Bellevue Gold Ltd (ASX:BGL) has intersected further high-grade gold that is likely to boost resources thereby supporting the plan to extend mine life and increase the production rate at Bellevue Gold Project in Western Australia.

Infill and extension drilling from underground has intersected extensive high-grade mineralisation in areas of the current inferred resource and outside the known limit of mineralisation.

New results from underground drilling at Deacon North lode include:

  • 7.4 metres at 16.9 g/t gold from 485.5 metres;
  • 8.9 metres at 12.7 g/t from 454.7 metres including 4 metres at 22.9 g/t from 454.7 metres;
  • 3.1 metres at 31.9 g/t from 518.9 metres;
  • 3.8 metres at 24.6 g/t from 503 metres;
  • 4 metres at 17 g/t from 457 metres; and
  • 9 metres at 7.2 g/t from 492 metres, including 5 metres at 10.5 g/t from 496 metres.

“Immense growth potential”

In light of these results, Bellevue has set a clear strategic target to upgrade more of the 1.4 million ounces of resources not included in the current life of mine plan (LOM).

Bellevue managing director Steve Parsons said: “These results provide more strong evidence of Bellevue’s immense growth potential.

“The Stage 2 Feasibility Study is based on a total resource of 1.56 million ounces, meaning there is already another 1.4 million ounces of resources outside the current life of mine plan.”

Shares are up 5.13% to A$0.82 while the company's market cap pre-open was approximately A$768.8 million.

That study forecasts annual average production of 183,000 ounces over the project’s current 8.1-year mine life which includes 200,000 ounces annually at an all-in sustaining cost of A$922/ounce in the first five years.

Optimising LOM

Along with further drilling, Bellevue will continue optimisation work on the LOM with a view to extending mine life and improving production rate beyond the first five years.

As well as upgrading these resources, the new results also point to increasing the 1.04 million ounces of probable ore reserves based on drilling completed up to July 2021.

The company is targeting ongoing drilling to grow the indicated resource, particularly from underground with the aim of extending mine life and increasing production rate by substituting marginal ounces from the existing schedule.

“These results highlight the scope to upgrade a significant proportion of this additional resource with infill drilling, which will in turn drive further potential increases in annual production and mine life and therefore financial returns,” Parsons said.

“This will enable us to keep unlocking the value of our exceptional resource and the production infrastructure we already plan to have in place.”

Deacon North Lode results

The new results are from a further 19 underground diamond holes targeting areas of inferred resources in the Deacon North Lode.

Drilling has continued to intersect lode positions with associated high-grade gold mineralisation stepping out from the areas of indicated resources used to inform the Stage 2 Feasibility Study reserve estimate.

Broad high-grade intersections have been received from areas of the current inferred resource, with grades elevated above the local block grade and also showing further growth around the edge of the inferred envelope.

Other Deacon North Lode results are:

  • 4.8 metres at 9.2 g/t gold from 608.7 metres;
  • 2.8 metres at 14.6 g/t from 441 metres;
  • 3.3 metres at 6.1 g/t from 619 metres;
  • 1.5 metres at 23.2 g/t from 633.6 metres; and
  • 1-metre at 31.8 g/t from 651.6 metres.

These results are extending and hosted in the same segment of the lode at Deacon North which has previously delivered strong high-grade intersections.

Redeveloping underground access

Bellevue continues to see the benefit of the investment into redeveloping underground access allowing drilling to proceed from underground in place of surface drill platforms.

This also results in reduced costs per metre, faster drilling rates and reduced depth to target.

Underground development continues to advance to the south (Viago Decline) which, together with a second heading to the north (Marceline Decline), is opening up new drill platforms.

This will allow underground drilling to access areas of the Deacon structure previously restricted to surface drilling and will allow conversion of the inferred resource and further step out drilling.

Deacon structure is of considerable scale with high-grade mineralisation over 2.2 kilometres of strike and 450 metres of down dip extent remaining open.

The current combined indicated and inferred resource at Deacon stands at 1.3 million ounces at 10.0 g/t including 690,000 ounces at 11.6 g/t of indicated resources.

Mineral resources and ore reserves at Bellevue Gold Project.

Resource growth at Deacon

Bellevue expects to see continued growth of indicated and inferred resources from Deacon with ongoing drilling.

Future growth will benefit from the already planned and costed access from both the northern and southern declines at Deacon, resulting in further reductions in the sustaining capital intensity per ounce from the area and continued improvements of the already robust project economics.

The company has budgeted for more than 110,000 metres of drilling between now and forecast first production in June 2023 with drilling from underground benefiting from cheaper and faster drilling rates.

Nearly 50% of the global resource sits outside of the recently released Stage 2 Feasibility Study and is not in the LOM.

Bellevue's growth strategy stands to deliver increased financial returns by leveraging already planned and costed infrastructure.

The latest results are close to infrastructure designed in the Stage 2 study and will require very little additional development from the current LOM.

A dual strategy of de-risking development in association with continued growth at the project is set to unlock further considerable value at the project and set the company up with a long-life resource and reserve base.

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