Musgrave Minerals Ltd reported the results of a Stage 1 Prefeasibility Study (PFS) on its Cue Gold Project, stating that the findings indicate a technically and financially sound project.
The Stage 1 PFS Life of Mine (LOM) plan focuses on the present 417,000 oz Indicated component of the 868,000 oz Southern Area Mineral Resource to achieve 345,000 oz of gold production with appealing physical and economic criteria.
Musgrave will soon progress to Stage 2 PFS, which is projected to extend the LOM as current drilling tests new opportunities and extends and upgrades existing Inferred Mineral Resources into the mine design, all while remaining 100% owned.
Musgrave is continuing to accelerate drilling to uncover additional discoveries, expand and de-risk the resource base, and add mine life through the Stage 2 PFS. Any additional resource increases in the S2 PFS will extend mine life and boost project value. The company is also advancing technical studies, allowing the Cue Gold Project to move forward faster.
“The excellent Stage 1 PFS outcomes demonstrate that Musgrave’s Cue Gold Project is one of the highest margin, undeveloped gold projects in Australia. This potential new standalone
development has a rapid payback period of 9 months from first processing due to the extraordinary near-surface, high-grade nature of the Break of Day and White Heat deposits,” Musgrave Managing Director Rob Waugh said.
According to Waugh, the Stage 1 PFS focuses primarily on the present Indicated Mineral Resources at the Cue Gold Project, which account for just 47% of the entire Resource base. He noted that the mining of six open pit deposits and an initial two years of gold output from the higher levels of the Break of Day underground mine are included in the Stage 1 PFS.
“A thorough and relatively conservative view was taken with the Stage 1 PFS utilising current costs from Q1CY23 RFQ’s acknowledging the current inflationary environment while also applying topcuts, ore loss and dilution to the resources. The initial pre-production CAPEX for the proposed standalone development of a 500kt/pa processing facility (with supporting camp, infrastructure and pre-production mining activities) is $121M. Reduced capital processing scenarios will be further evaluated during the Stage 2 PFS,” he stated.
Waugh added, “The Stage 2 PFS, is set to add mine life through the extension and conversion of existing Inferred Resources to the higher confidence Indicated category, together with the potential inclusion of newly discovered resources. The Musgrave team has been very successful in defining new targets, making new discoveries and growing the resource base. The project has significant upside growth potential with recent discoveries like Amarillo and Waratah expected to add to the resource base in 2023 to align with delivery of the Stage 2 PFS in early 2024.”
