Latitude’s mission - reignite the gold potential of Andy Well

There are few Australian gold projects of recent years which have shone as brightly and briefly as Andy Well; the high-grade, company-making project which once put Doray Minerals on the map.

The Andy Well story is well known in mining circles. Discovered by Doray in WA’s Murchison region in 2010, the project produced first gold in August 2013, and by 2015 was named Australian Mining’s Australian Mine of the Year.

But the success of Andy Well, which over its first life produced more than 300,000 ounces at more than eight grams per tonne, would end up being short-lived.

A combination of depressed conditions for gold and Doray’s interest in the larger Deflector gold project would see the mine placed on care and maintenance in September 2017.

Latitude Andy Well — Movements in the AUD gold price since Andy Well was placed on care and maintenance in 2017. Pic: Supplied.

Andy Well and the highly prospective neighbouring Gnaweeda gold project would soon find themselves in the Silver Lake Resources (ASX:SLR) stable, following its landmark merger with Doray in 2019.

But the projects somehow continued to sit in the shadows beneath the hot Western Australian sun – dormant despite a combined 776,000 ounces of known gold resources.

That is until recently, when Silver Lake struck an agreement to sell both to Latitude Consolidated (ASX:LCD) in a deal worth $8 million – roughly $10 per mineral resource ounce.

Now, as we head into 2021, Latitude is looking to put Andy Well back on the Australian mining map; a significant homecoming for a highly regarded project left dormant for more than three years.

It’s a move which begs the question – how many other promising projects out there fit the Andy Well mould?

There may be more to Andy

In contrast to Doray’s dashing, production-centric approach to developing Andy Well in the early part of the 2010s, Latitude’s plans are more focused on growing the potential in the ground at both the former mine and the neighbouring project.

CEO Tim Davidson told Stockhead recently that the intention was not to rush Andy Well back into production.

“The focus for us in the first part of the year is to build the resource at Andy Well and Gnaweeda,” he said.

“We’ve got a significant resource base as it is, and we’d like to build that from its current position just below 800,000 ounces towards the million-ounce mark or more.

“Based on the geological database and dataset, we think it’s really good ground and there’s huge potential for exploration success.

“Our plan is to follow up a lot of the high-grade drill hits and intersections in and around Andy Well and Gnaweeda that haven’t got a mineral resource attached to them – once we’ve done that we will complete the necessary mining studies with a view to development.”

First step is program of work approval from the WA government, expected shortly, before a drilling program planned to begin in early April, where 10,000 metres of exploration drilling will to be split between Andy Well and Gnaweeda.

The early results will be used to guide further exploration in the second half of the year, while also being channelled for potential resource expansion.

The reason there’s so much exploration potential in a recently mined project, according to Davidson, is the speed at which Doray moved towards getting the asset into production.

“Doray moved it from exploration to production really quickly, and we view that there’s lots of high-grade targets and drill results in and around the existing resource that weren’t followed up, because there was such a focus on transitioning to production,” he said.

“There’s a lot of opportunity to follow up targets that didn’t get the attention when Doray or Silver Lake had it, so that’s key to the project moving forward – to go out and explore those as an immediate focus.”

The eventual production potential is further boosted by the presence of existing and modern infrastructure – minus some parts of the mill which were removed by Silver Lake to use at Deflector.

“The ball mill itself and the gravity circuit were taken to Deflector, but the primary crusher and the tanks and all of that infrastructure is still onsite,” Davidson said.

“There is store buildings and various other infrastructure onsite which are in very good condition as well – it’s all top class construction and the bonus is that it’s not very old, less than 10 years.”

Plans beyond the Murchison

While Andy Well and Gnaweeda loom as the immediate priority for Latitude, they make up just one of a suite of three highly prospective projects in the company playbook.

There’s the greenfields Skye gold project in South Australia’s Gawler Craton, where a number of targets sit proximate to large-scale gold projects of national and global significance.

“Marmota (ASX:MEU) in particular, which is proximal to our package, has had some really good results,” Davidson said.

“Skye is early stage for us, but we’re in the process of getting the permits in places with the South Australian mines department, and we’ll be looking to do exploration field work on the ground in the second half of the year.”

There’s also the Circle Valley project in the southern part of WA, along the western edge of the Albany Fraser mobile belt which hosts the 7.1-million-ounce Tropicana gold mine.

Latitude plans to explore all three in the second half of the year.