Hillgrove Resources is looking to advance faster development of its underground discovery at the historic Kanmantoo copper gold mine southeast of Adelaide after good results from four diamond drill holes have boosted the company’s confidence in the size and quality of the resource.
In a statement to the ASX Monday morning Hillgrove said four new diamond holes in the Kavanagh mineral zone at Kanmantoo had all intersected strong copper-gold mineralisation.
The Kavanagh surface drilling program is now complete with drilling continuing at Nugent, according to Hillgrove.
Upon completion of the drilling program at Nugent, Hillgrove says it will update the respective mineral resource estimates for the Kavanagh and Nugent lode systems, which is expected to grow the resource in size and geological confidence.
“… success of the program to date has continued to increase the robustness of the Mineral Resource Estimate and solidifies our production restart plan,” Hillgrove said.
“In light of the above, the continued strong demand in copper and our advanced discussions with debt providers for the entire production restart capital, Hillgrove is considering bringing forward planned copper production and is accelerating development efforts to fast-track access to ore.
“With ample processing and tailings storage capacity already on site, any increase in copper production will not require additional capital or permitting and would be expected to reduce the average all-in sustaining cost per tonne of copper produced.
“With funding discussions advanced and at definitive agreements stage, subject to Board approval, the Company expects to be in a position to commence production restart in 2022 as scheduled.
Hillgrove said it will provide further information on its targeted timeline closer to the completion of its debt financing which seems to be shortly, if Monday’s statement is any guide.
Hillgrove CEO Lachlan Wallace said in Monday’s statement: “It is a very predictable mineral system to drill, with every drill hole since May 2021 yielding significant intersections of copper.
“The recent drilling results continue this trend, with multiple high-grade zones being delineated within wider zones of copper mineralisation of around 100 metres in downhole length.
“As these holes are incorporated into the geological model, it is expected the resource estimate will grow both in size and in geological confidence.
“The broader mineral zones in holes KTDD208 W1 and W4 complement previous drill results in 2021, including 170 metres at 1.0% copper and 166 metres at 0.9% copper, and demonstrate the presence of a large copper system at Kanmantoo.
“On the back of the continuing strong copper demand and the expectation that debt funding for the entire restart capital will be secured in the near term, we are bringing forward potential copper production by accelerating the decline development through a short-term mining contract using traditional drill and blast practices,” he said.
Hillgrove shares were unchanged at 5.3 cents.
