PNX receives milestone environmental approval for Fountain Head gold project

PNX Metals’ Fountain Head gold project has become one of only a handful of proposed mines in the past few years to be granted environmental approval by the Northern Territory government.

PNX Metals (ASX:PNX) revealed today that the Northern Territory government had given its blessing for the development of the Fountain Head gold project in the Pine Creek region.

The decision follows the recommendation by the NT Environmental Protection Authority that the Fountain Head project be given the green light.

The Environmental Impact Statement is a crucial part of the project approval process, but it’s only a very short list of mining projects that have successfully passed this stage over the last few years, and received the go ahead to move into production, from the independent environmental monitors of Australia’s most northern territory.

PNX’s Fountain Head gold and Hayes Creek zinc-gold-silver projects were two of just six mining projects being assessed for environmental approval by the NT EPA.

Prior to Fountain Head getting the go ahead, just eight mining projects had received approval by the NT EPA under an EIS over the last five years.

“The grant of environmental approval for the Fountain Head gold project is the culmination of a significant body of work, and a milestone event in PNX’s Pine Creek integrated development strategy,” managing director James Fox said.

PNX provided the NT EPA with a comprehensive risk assessment, including studies on groundwater and surface water, biodiversity, Aboriginal and cultural heritage, socioeconomic impacts, transport, air quality, noise, and closure/rehabilitation.

With environmental approval now in hand, PNX can submit Mining Management Plans (MMPs) to the Department of Industry, Tourism and Trade for assessment for the Fountain Head and recently acquired Mt Porter deposits.

The project team is now focused on completing and submitting Mine Management Plans and progressing approvals for the Hayes Creek zinc-gold-silver project,” Fox said.

“Near-mine and regional exploration will re-start shortly with a focus on two newly identified highly prospective ‘gold’ corridors containing multiple high-priority drill targets on our northern leases.

“We will continue to work with the NT regulators on this and our other projects to ensure the best outcomes for all stakeholders.”

The Fountain Head MMP is expected to be lodged with the Department of Industry, Tourism and Trade in March.

This is the final step in the approvals process and if successful, PNX could receive final mining approval by the third quarter of 2023.

PNX plans to establish the Fountain Head and Hayes Creek projects as an integrated zinc-gold-silver operation and central processing hub in the Pine Creek region.

The company anticipates mining and processing ore from three wholly owned gold deposits – Fountain Head, Glencoe, and Mt Porter – and two wholly owned zinc-gold-silver deposits – Mt Bonnie and Iron Blow. All five of the deposits are located on granted mining leases.

A prefeasibility study on the Fountain Head gold and Hayes Creek gold-silver-zinc projects completed mid-2021 highlighted a robust, multi-commodity, two-stage mine development that would have an initial mine life of 10 years, a pre-tax net present value (NPV) of $171m and a pre-tax internal rate of return (IRR) of 63%.

That excludes the upgrade to the Glencoe resource and the Mt Porter gold deposit acquired late last year.

This article was developed in collaboration with PNX Metals, 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.