Mining heavyweight Gold Fields kicks off major drilling campaign on Lefroy’s ground
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Special Report: One of the world’s largest gold miners has started a major drilling program on Lefroy Exploration’s prospective Lake Lefroy tenements in Western Australia.
South Africa’s Gold Fields are ready to commit to a significant drill program on Lefroy’s landholding as part of a $25m farm-in and joint venture deal the pair struck back in June last year.
Gold Fields has seven operating mines in Australia, Ghana, Peru and South Africa with total attributable annual gold-equivalent production of 2.2 million ounces.
The heavyweight’s projects in Australia include the wholly owned St Ives, Agnew and Granny Smith mines in the Eastern Goldfields of Western Australia, which have combined annual production of 935,000 ounces.
Gold Fields also has a 50 per cent interest in the Gruyere project, also in the Eastern Goldfields, with Gold Road Resources (ASX:GOR).
The company is focused on exploring the Western Lefroy tenements that cover 372 sq km right next to the 15-million-ounce St Ives gold camp.
The St Ives camp surrounds the Beta Hunt underground mine, where operator RNC (TSX:RNX) recently discovered one of the “richest and most prolific gold veins ever found”.
Western Lefroy is part of the wholly owned greater Lefroy gold project, located 50km south east of Kalgoorlie.
The Gold Fields activity complements the exploration by Lefroy at Eastern Lefroy, which adjoins Silver Lake Resources’ (ASX: SLR) Mt Monger gold operations, highlighting the acceleration of gold exploration on two fronts
Gold Fields can earn up to a 70 per cent stake in the Western Lefroy tenements by spending up to $25m on exploration within six years.
The structure of the agreement allows Lefroy the “tag along” right to process gold ore from a development project through Gold Fields’ St Ives Mill on pre-agreed terms, with no additional capital to be spent by Lefroy on a new plant.
Lefroy will be a capital light explorer and potential producer on success.
Gold Fields has to spend at least $4m within two years before it can choose to withdraw from the project.
The major started exploration on Western Lefroy in July last year, undertaking multi-disciplinary ground and airborne geophysical surveys (gravity and magnetics) primarily located on or near Lake Lefroy.
The extensive detailed geophysical survey program is still in progress.
Lefroy says the surveys will build on the data collected from lake drilling by the company in 2017 and deliver a foundation detailed geophysical dataset to be used for target identification and focused drilling.
This large, full field drilling program is expected to take four months to complete.