Refurb costings take Brightstar closer to production goals
A review into the refurbishment of Brightstar Resources’ namesake gold mill in WA has found the facility needs just $5.5 million worth of work to get running.
The results of the report, compiled by Como Engineers for Brightstar (ASX: BTR), came in lower than the company anticipated and present a significant step forward in its goals for the Brightstar gold project where the plant is located.
Significantly, the cost of refurbishment not only brings the facility back into working order, but also allows for modifications and upgrades which would enable Brightstar to expand oxide production capacity to around 650,000 tonnes per annum.
That rate would be more than double the mill’s previous estimated capacity.
A refurbishment, including upgrades and commissioning, would take a team of up to 10 around three months, with an extra three required for the production of a new head for the ball mill.
According to the report core components of the mill, including the run of mine bin and grizzly, the carbon-in-leach tanks, crushers, feeders and mills were found to be in overall decent condition.
The refurbishment and upgrade was greatly assisted by work done in 2014 by the company when they installed a secondary crusher, a 450kW ball mill, a gravity circuit, and procured and partially installed an elution circuit as part of an upgrade project.
Some of this equipment was not fully installed at the time but remained on-site under care and maintenance.
Brightstar managing director Bill Hobba said the result of the study was a positive one.
“Costing refurbishment of the mill at $3.6 million is lower than we had anticipated,” he said.
“The report costs restoration of the mill at $2.8 million, with a 30% contingency. Owner costs represent an additional approximate $1.9 million, which brings total costs of restoring the mill to approximately $5.5 million.
“Brightstar anticipate that, based on the upgrades proposed in the report, the mill should be able to achieve an oxide processing capacity of ~650ktpa – almost doubling the mill’s previous estimated capacity.
“The board thank Richard Ladyman and his team at Como for preparing a robust and independent review of the costs associated with returning Brightstar’s flagship mill to operational capacity.
“We look forward to taking steps to prepare the mill for refurbishment, including restoring the on-site camp and mobilising Como staff to conduct a final inspection and prepare a +-15 percent final cost estimate for an EPC contract.
“Refurbishment of the mill is a critical step in Brightstar returning its significant JORC-2012 Mineral Resource to production after years in hiatus.”
Today’s report will be incorporated into a broader three-year strategic plan for Brightstar, which the company intends to release before the end of the financial year.
The mill is likely to be a strategically significant element of that plan, sitting within 60km of Brightstar’s three major deposits in Alpha, Beta and Cork Tree Well.
The three deposits have a combined mineral resource of around 445,000 ounces of gold near Laverton.
The mill is also close to a number of advanced, third-party gold projects Brightstar believes could make for toll treatment opportunities.
This article was developed in collaboration with Brightstar 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.