Laneway begins next round of high-grade gold mining at Agate Creek
Special Report: Mining is now officially underway, and bang on schedule, at Laneway Resources’ high-grade Sherwood pit in North Queensland, with the first blast completed on Thursday.
Laneway Resources (ASX:LNY) revealed last week it was starting another round of high-grade gold mining at its Agate Creek mine that is set to deliver even more cash than the prior campaign thanks to even higher prices.
The first blast was completed yesterday, exposing the first ore to be mined to produce 9,000oz of gold in two stages.
At the current high Aussie dollar gold price, that would likely hand the company something in the vicinity of around $24m revenue. This will substantially boost Laneway’s coffers and leave it well funded to advance exploration and development of its projects without the need to tap shareholders for more cash and risk further dilution.
This pushed shares up nearly 30 per cent on Friday to an intra-day peak of 0.9c. Laneway is now sitting 183 per cent higher since mid-March.
“Commencement of mining activities at Sherwood on time is a great outcome for Laneway shareholders and we will be processing ore very soon through Lorena’s mill,” chairman Stephen Bizzell said.
“This means that significant revenue will be flowing to the company.”
An initial 18,000t of the total 43,000t being mine from the Sherwood Pit in the current campaign will be processed in the current quarter and the remaining 25,000t will be stockpiled for processing at the end of the wet season.
The initial ore parcel will be toll processed at the Lorena gold mine carbon-in-leach processing plant at a fixed price per tonne.
The processing of the initial 18,000t will start around mid-November and take about three weeks to complete. Laneway anticipates high gold recoveries of around ~90 per cent.
“The processing deal we have struck with Lorena enables payment by year end for the majority of the gold produced during this campaign,” Bizzell noted.
“This sets the company up well for a busy 2021 as we focus in parallel on the planning, approvals and development of the larger volume of high-grade ore encompassed by the larger Whittle pit shell and then turn our attention to options for onsite processing of the almost half a million ounces identified at Agate Creek.”
Laneway is continuing to progress other processing plant options which may be utilised longer term for the processing of high-grade ore from Agate Creek, including for the second batch of ore from the current mining campaign.
This article was developed in collaboration with Laneway 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.