Red 5’s King of the Hills is Australia’s newest gold producer
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Red 5 (ASX:RED) has poured first gold at the 2.4Moz, 16-year life-of-mine King of the Hills (KOTH) gold project in WA.
The first smelt delivered 2 gold doré bars weighing 1,588oz; a huge milestone for the company, says managing director Mark Williams.
“It marks the beginning of a new era for Red 5, with the new 4.7Mtpa King of the Hills processing plant set to become a highly efficient production hub,” he says.
“There are promising signs regarding future throughput potential and with two months of feed stocks ready for processing and mining now well established, we have a strong platform to build upon.”
RED has spent upwards of $200 million redeveloping the open pit at KoTH left behind after the collapse of Sons of Gwalia in the early 2000s.
Its production is due to crank up to 176,000oz annually in the first six years of an initial 16-year mine life, with life-of-mine all-in sustaining costs estimated at $A1,415/oz.
The feasibility study for the project was based on a $A2,500/oz price assumption which is slightly lower than where things now stand.
On that basis, annual earnings (EBITDA) of $166 million were forecast.