Brightstar beaming as first ore mined from Selkirk
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Special Report: First ore has been mined from the Selkirk gold deposit under the joint venture between Brightstar Resources and BML Ventures in the Eastern Goldfields.
Brightstar Resources (ASX: BTR) reports mining operations are progressing ahead of schedule at Selkirk, which sits within the company’s larger Menzies gold project, with a second consecutive month of high productivity and above-budget material movement achieved by BML during October.
First ore is expected to be hauled to the Genesis Minerals (ASX: GMD) Gwalia processing plant in February with 50% of project net cashflow to be distributed to BTR by the end of the quarter.
Brightstar’s main game remains becoming a meaningful gold producer of scale via the longer term development of its +1Moz Menzies and Laverton gold projects.
The Menzies project includes the high-grade goldfield which historically produced 787,200oz at an astonishing 18.9g/t gold for a century until mining ceased in 1995.
Brightstar is also actively reviewing other deposits within its portfolio for what the company describes as “Selkirk 2.0” opportunities which could generate cashflow for the larger project. This includes the near-surface, oxide material at Menzies which carries the potential for low-risk, high-margin ounces.
Ore will continue to be stockpiled at the Selkirk ROM pad before it is hauled to Gwalia for the scheduled first gold pour in February.
In a further boost for the Selkirk open pit joint venture, approximately 1500t of material grading over 3g/t gold was delineated and mined from the hangingwall lode, which is within the resource model but not within the mine plan budget. It will now be added to the known +5g/t gold material contained within the high-grade main lode.
Brightstar managing director Alex Rovira is delighted with the progress being made at Selkirk.
“Positively, the project is budgeted on a gold price of $2,850/oz, compared to the current spot price of $3,050/oz, which presents upside in the forecast economics for the joint venture,” he said.
“As the mining campaign at Selkirk advances, we continue to assess further opportunities at Menzies for potential near-term and low risk exploitation. These opportunities are targeted to deliver organic funding that will provide working capital for the continued exploration across the Brightstar portfolio and the PFS under way.”
Brightstar expects material movements over the final three months of mining at Selkirk to reduce in line with increased ore delivery, tighter working areas and other typical constraints associated with reduced volumes at the base of open pit mines.
The company has also selected a number of key consultants to undertake specialist workstreams in the PFS. These include ABGM (mining engineering, mine design and scheduling), Como Engineers (process plant design, opex and capex estimation), Independent Metallurgical Operations (metallurgy), Resolve Mining Consultants (open pit and underground geotechnical) and WSPGolder (tailings deposition).
Geotechnical and metallurgical testwork has commenced ahead of diamond drilling planned for Q1 2024.
Several environmental and permitting workstreams are also under way, including heritage surveys, groundwater and waste geochemistry studies.
The PFS will build on the results of Brightstar’s scoping study released in early September which estimated roughly 40,000ozpa gold production over an initial eight years at Menzies and Laverton, generating post-tax NPV of $103 million, IRR of 79% and payback in 1.5 years. A gold price of $2900/oz was assumed.
Pre-production capital for the Menzies and Laverton operation was estimated at just $22 million.
This article was developed in collaboration with Brightstar Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.