Westgold Declares Maiden South Junction Ore Reserve
ASX Announcement
13 August 2024
Westgold Declares Maiden South Junction Ore Reserve
Bluebird-South Junction expands to 1.2Mtpa run rate from Q3 FY25
Westgold Resources Limited (ASX: WGX, TSX: WGX, OTCQX: WGXRF – Westgold or the Company) is pleased to present the maiden Ore Reserve for its South Junction mine. South Junction is a part of a broader Bluebird - South Junction mining complex which is becoming the primary ore source for the Bluebird processing hub at Meekatharra with a 1.2Mtpa run rate targeted from Q3, FY25.
Highlights
Bluebird – South Junction Ore Reserve increases to 3.0Mt @ 2.8g/t Au for 277koz
- 233% increase (+158koz) from the FY23 Ore Reserve post depletion.
- Contribution from the maiden South Junction Ore Reserve of 2.6Mt @ 2.7g/t Au for 225koz.
Updated Bluebird – South Junction Mineral Resource exceeds Interim Mineral Resource announced in March 2024 by a further 130koz post depletion of 14koz
- 61% increase in Indicated Resources.
- Ore Reserve underwritten by updated Mineral Resource Estimate (MRE) of 11Mt @ 2.8g/t Au for 960koz featuring a Measured and Indicated component of 4.7Mt @ 3.1g/t Au for 465koz Au.
Further Resource conversion targeted with substantial drilling program ongoing
- 2 x surface rigs and 2 x underground drill rigs continue to extend and infill the Bluebird – South Junction Mineral Resource.
- South Junction remains open at depth and to the south along strike/down plunge.
Production from South Junction to commence in August
- The significant width of the South Junction orebody enables a highly productive primary / secondary transverse stoping method which will significantly increase production from the Bluebird – South Junction system.
- Production rate of 1.2Mtpa – from Bluebird-South Junction targeted from Q3 FY25.
Westgold Resources Limited westgold.com.au Level 6, 200 St Georges Terrace ABN 60 009 260 306 T: +61 8 9462 3400 Perth WA 6000 ASX:WGX / TSX:WGX / OTC:WGXRF E: [email protected] PO Box 7068, Cloisters Square WA 6850
Westgold Managing Director and CEO Wayne Bramwell commented:
“Westgold is rapidly building a mine of significant scale and life at Meekatharra. The maiden Ore Reserve for South Junction and the rapid expansion of the Bluebird-South Junction mining complex to a 1.2Mtpa run rate by Q3, FY25 has been a remarkable success story and underpins the value in drilling.
A larger, more productive Bluebird-South Junction underground mine is a game changer for our Murchison business. It will reduce the requirement and cost of road haulage of ore from Cue (circa 140km) as the Bluebird-South Junction complex is within 2km of the nearby Bluebird mill.
Westgold will continue to invest in drilling across our portfolio in FY25. With Bluebird-South Junction and Big Bell in the Murchison, buttressed by the expanding Beta Hunt in the Goldfields, we continue to build a diversified platform that can produce more consistent and sustainable long term cashflows and returns to our shareholders.”
Figure 1 - Bluebird – South Junction underground complex showing footprint of current Ore Reserve
South Junction – production online in August, due to lift rates from Q3 FY25
Westgold’s pipeline of organic growth targets is extensive. South Junction at Meekatharra was identified as a priority growth opportunity following the results of initial drill testing of the project in early 20231. A significant drilling program was initiated in January 2024 aimed at extending and infilling South Junction. This program continues, with two rigs active on surface and two in the underground environment.
Westgold recognised the vast scale of South Junction, prompting the undertaking of an interim MRE2 to expedite mine planning studies. Since March, drilling to increase the confidence in the Inferred portion of the MRE has progressed in parallel with mine planning studies. The results of this drilling have enabled Westgold to undertake an update to the MRE that has seen the substantial conversion of Inferred material to Indicated (See Table 1 and Figure 2). This update includes 14koz of depletion from three months of production on the Bluebird side of the mine.
| Classification | Interim March 2024 MRE | August 2024 MRE | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Tonnes | Grade | Ounces | Tonnes | Grade | Ounces | |||||||
| Tonnes | (g/t Au) | Ounces | Tonnes | (g/t Au) | Ounces | |||||||
| Measured | 302,000 | 4.4 | 43,000 | 304,000 | 4.1 | 40,000 | ||||||
| Indicated | 2,872,000 | 2.9 | 264,000 | 4,368,000 | 3.0 | 425,000 | ||||||
| Inferred | 5,844,000 | 2.8 | 520,000 | 6,032,000 | 2.6 | 495,000 | ||||||
| Total | 9,017,000 | 2.9 | 827,000 | 10,705,000 | 2.8 | 960,000 |
Table 1 – Bluebird - South Junction MRE August 2024 (reported above 1.5g/t Au).3
Figure 2 – Substantial growth and improvement in MRE quality between Interim and August 2024
1 Refer ASX Release titled “Bluebird Expansion and Drilling Update - 11 January 2023”
2 Refer ASX Release entitled “Bluebird-South Junction Increases to 6.4Mt at 3.1 g/t Au- 16 April 2023”
3 Interim March 2024 MRE as at 31 March 2024 and August 2024 MRE as at 30 June 2024 Subsequent mine planning and commercial evaluation works have resulted in an updated Ore Reserve being declared for the Bluebird – South Junction mine (Table 2). The contribution to this overall Ore Reserve from the Maiden South Junction Ore Reserve subset is presented in Table 3.
| Classification | Tonnes | Grade | Ounces | |
|---|---|---|---|---|
| (g/t Au) | ||||
| Proven | 76,600 | 3.9 | 9,400 | |
| Probable | 2,966,500 | 2.8 | 268,000 | |
| Total | 3,041,000 | 2.8 | 277,000 |
Table 2 – Bluebird - South Junction Ore Reserve August 2024
| Classification | Tonnes | Grade | Ounces | |
|---|---|---|---|---|
| (g/t Au) | ||||
| Proven | 26,300 | 3.1 | 2,600 | |
| Probable | 2,612,000 | 2.7 | 223,000 | |
| Total | 2,638,000 | 2.7 | 226,000 |
Table 3 –South Junction Maiden Ore Reserve August 2024
In the South Junction area, this Ore Reserve will be exploited via a change in mining method from the centre-access retreat Longhole Open Stoping currently employed in the Bluebird area of the mine, to a highly productive primary / secondary transverse stoping method with fill. This change in method will enable the production rates of Bluebird – South Junction to increase to more than triple from the current rate of +30kt per month (refer ASX – Westgold March 2024 Quarterly Report) to rates of 100kt per month from Q3 FY25.
Figure 3 – Visible gold in recent South Junction drilling
Mining in South Junction is scheduled to commence in August.
Production rates at South Junction will rapidly increase over the coming months. This ramp up is a function of the increased scale of the South Junction lodes (as compared to the Bluebird lodes) which accommodates a more productive mine layout and extraction sequence. (see Figure 4 which depicts the vast difference in scale compared a typical Bluebird stope)
Figure 4 – South Junction schematic mine layout showing the scale of a typical South Junction stoping panel as compared to a typical stoping panel of the current Bluebird mine (Refer Appendix B for detailed drill results)
Looking Forward
Westgold’s corporate strategy is to continue to simplify our business by making our biggest mines bigger and focusing on grade. The expansion of the Bluebird underground to include new mining fronts from South Junction is consistent with this plan.
Drilling activities continue to expand the Bluebird – South Junction system and increase Mineral Resource confidence. This continued drilling will ultimately underwrite future updates to the MRE and Ore Reserve. The orebody remains open at depth and to the south along strike/down
plunge, as can be seen in Figure 1.
Necessary capital projects to enable the larger mine to function effectively are progressively being scoped and delivered, with power, ventilation and backfill solutions well defined. Westgold looks forward to providing updates on its progress at Bluebird – South Junction over the coming months.
Figure 5 – Long Hole rig drilling the first South Junction stope
This announcement is authorised for release to the ASX by the Board.
Investor and media relations enquiries
Investor Relations Media Kasun Liyanaarachchi | Investor Relations Manager Peter Knight | Communications Manager [email protected] [email protected] +61 458 564 483 +61 459 980 481
Competent/Qualified Person Statements
Exploration Results and Mineral Resource Estimates
The information in this release that relates to Exploration results and Mineral Resource Estimates is compiled by Westgold technical employees and contractors under the supervision of Mr. Jake Russell B.Sc. (Hons), who is a member of the Australian Institute of Geoscientists and who has verified, reviewed and approved such information. Mr Russell is a full-time employee of the Company and has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activities which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”) and as a Qualified Person as defined in the CIM Guidelines and National Instrument 43-101
- Standards of Disclosure for Mineral Projects (“NI 43-101”). Mr. Russell is an employee of the Company
and, accordingly, is not independent for purposes of NI 43-101. Mr Russell consents to and approves the inclusion in this release of the matters based on his information in the form and context in which it appears. Mr Russell is eligible to participate in short- and long-term incentive plans of the company.
The updated MRE has an effective date of 30 June 2024 and was completed by Westgold technical employees and contractors under the supervision of Mr Jake Russell. The key inputs and assumptions are provided in Appendix C to this release including Section 1 – Sampling Techniques and Data, Section 2 – Reporting of Exploration Results, Section 3 – Estimation and Reporting of Mineral Resources and Section 4 – Estimation and Reporting of Ore Reserves.
Ore Reserves
The information in this release that relates to Ore Reserve is based on information compiled by Mr. Leigh Devlin B.Eng. FAusIMM, who has verified, reviewed and approved such information. Mr. Devlin has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activities which they are undertaking to qualify as a Competent Person as defined in the JORC Code and as a Qualified Person as defined in the CIM Guidelines and NI 43-101. Mr. Devlin is an employee of the Company and, accordingly, is not independent for purposes of NI 43-101. Mr. Devlin consents to and approves the inclusion in this release of the matters based on his information in the form and context in which it appears. Mr. Devlin is a full-time senior executive of the Company and is eligible to and may participate in short-term and long-term incentive plans of the Company as disclosed in its annual reports and disclosure documents.
General
Mineral Resources, Ore Reserve Estimates and Exploration Targets and Results are calculated in accordance with the JORC Code. The other technical and scientific information in this release has been prepared in accordance with the Canadian regulatory requirements set out in NI 43-101 and has been reviewed on behalf of the company by Qualified Persons, as set forth above.
This release contains references to estimates of Mineral Resources and Ore Reserves. The estimation of Mineral Resources is inherently uncertain and involves subjective judgments about many relevant factors. Mineral Resources that are not Ore Reserves do not have demonstrated economic viability. The accuracy of any such estimates is a function of the quantity and quality of available data, and of the assumptions made and judgments used in engineering and geological interpretation, which may prove to be unreliable and depend, to a certain extent, upon the analysis of drilling results and statistical inferences that may ultimately prove to be inaccurate. Mineral Resource estimates may require reestimation based on, among other things: (i) fluctuations in the price of gold; (ii) results of drilling; (iii)
results of metallurgical testing, process and other studies; (iv) changes to proposed mine plans; (v) the evaluation of mine plans subsequent to the date of any estimates; and (vi) the possible failure to receive required permits, approvals and licenses.
The NI 43-101 technical report supporting the Maiden Ore Reserve contained in this release will be filed on SEDAR+ within the next 45 days of the date of this release. Reference should be made to the full text of the technical report for the assumptions, qualifications and limitations relating thereto.
Forward looking statements
These materials prepared by Westgold Resources Limited include forward looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”, “will”, “expect”, “intend”, “believe”, “forecast”, “predict”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.
Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance and achievements to differ materially from any future results, performance or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licenses and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the Company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.
Forward looking statements are based on the Company and its management’s good faith assumptions relating to the financial, market, regulatory and other relevant environments that will exist and affect the Company’s business and operations in the future. The Company does not give any assurance that the assumptions on which forward looking statements are based will prove to be correct, or that the Company’s business or operations will not be affected in any material manner by these or other factors not foreseen or foreseeable by the Company or management or beyond the Company’s control.
Although the Company attempts and has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual results, performance, achievements or events not to be as anticipated, estimated or intended, and many events are beyond the reasonable control of the Company. In addition, the Company’s actual results could differ materially from those anticipated in these forward looking statements as a result of the factors outlined in the “Risk Factors” section of the Company’s continuous disclosure filings available on SEDAR+ or the ASX, including, in the Company’s current annual report, half year report or most recent management discussion and analysis.
Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, in providing this information the Company does not undertake any obligation to publicly update or revise any of the forward-looking statements or to advise of any change in events, conditions or circumstances.
Appendix A History of South Junction
Mineralisation was discovered at South Junction in mid-1989 by St Barbara Mining. South Junction was subsequently mined as an open pit from June 1990 through to the early 2000’s. Total gold production for the open pit phase of operation at South Junction was in excess of 400,000 ounces. However, since open pit mining concluded activity at South Junction has effectively been dormant.
To the immediate north of South Junction, the Bluebird deposit has been mined at various stages. This mining was dominated by small scale underground mining operations and open pits until the turn of the century after which St Barbara, Mercator Gold and Reed Resources mined 485,000 ounces between 2000 – 2013 via substantial open pit operations.
Figure 6 – Yaloginda gold camp is absent deep drilling outside of Bluebird – South Junction
In late 2019, Westgold commenced underground operations at Bluebird which subsequently produced over 137koz of gold. This brings the total recorded Bluebird production to 784koz and the combined Bluebird – South Junction production to 1.18Moz. Combining this with the Mineral Resource remaining, Bluebird – South Junction can be considered a +2Moz system.
South Junction hosts numerous mineralised zones broadly located on sub-parallel northnortheast-trending structures. These zones from west to east are: Edin Hope, South Junction, Polar Star and Archenar. These zones are offset from the East, Central and Western lodes at Bluebird, with the interaction between the two poorly understood due to a lack of drilling.
Murchison Overview
Westgold’s Murchison Operations incorporates four underground mines, three processing plants and the Great Fingall development project near Cue. Westgold’s Bluebird processing hub is the largest of our three Murchison processing hubs and is located approximately 15km southwest of Meekatharra (see Figure 7).
The Bluebird underground mine is the primary ore source feeding the 1.4-1.8Mtpa Bluebird processing plant. Surface stockpiles and supplementary ore from Cue is trucked to Bluebird to maintain processing throughputs, with these volumes reducing as the Bluebird-South Junction mine expands.
Figure 7 – Westgold’s Murchison Asset Map
APPENDIX B – Drill Results Included In This Release4
| Hole | Collar N | Collar E | Collar RL | Intercept (Downhole) | From (m) | Dip | Azi |
|---|---|---|---|---|---|---|---|
| 24BLDD064 | 7,043,673 | 641,491 | 100 | 3.07m at 2.30g/t Au | 15 | -47 | 101 |
| 1m at 6.37g/t Au | 41 | ||||||
| 31.37m at 5.55g/t Au | 122 | ||||||
| 15.5m at 4.62g/t Au | 158 | ||||||
| 24BLDD066 | 7,043,673 | 641,491 | 100 | 4.6m at 3.79g/t Au | 21 | -53 | 113 |
| 22.8m at 1.25g/t Au | 173 | ||||||
| 15.82m at 3.09g/t Au | 210 | ||||||
| 18.9m at 3.65g/t Au | 293 | ||||||
| 24BLDD095 | 7,043,757 | 641,489 | 96 | 9.25m at 3.79g/t Au | 122 | -22 | 67 |
| 24SJDD001 | 7043454 | 641917 | 468 | 10.45m at 3.80g/t Au | 788 | -79 | 302 |
| 3.98m at 10.80g/t Au | 894.49 | ||||||
| 24SJDD004 | 7043417 | 641924 | 468 | 3.75m at 3.01g/t Au | 560 | -48 | 292 |
| 9.45m at 2.54g/t Au | 573.85 | ||||||
| 3.29m at 3.28g/t Au | 588.53 | ||||||
| 24SJDD010 | 7043417 | 641925 | 467 | 12.70m at 8.57g/t Au | 415.58 | -53 | 296 |
| 8.03m at 1.58g/t Au | 543.44 | ||||||
| 4.00m at 3.81g/t Au | 637 | ||||||
| 24SJDD012 | 7043411 | 641923 | 467 | 2.00m at 6.72g/t Au | 418 | -52 | 296 |
| 7.90m at 5.20g/t Au | 592.5 | ||||||
| 6.80m at 3.87g/t Au | 600.9 | ||||||
| 3.68m at 4.55g/t Au | 619.87 | ||||||
| 24SJDD015 | 7043411 | 641923 | 467 | 3.00m at 4.54g/t Au | 482 | -59 | 293 |
| 3.00m at 12.91g/t Au | 531.7 | ||||||
| 8.10m at 4.31g/t Au | 656 | ||||||
| 2.21m at 17.30g/t Au | 696.79 | ||||||
| 24SJDD019 W1 _ | 7043410 | 641925 | 467 | 6.27m at 3.76g/t Au | 641.42 | -59 | 284 |
| 2.62m at 4.26g/t Au | 648.53 | ||||||
| 24SJDD021 W2 _ | 7043405 | 641939 | 467 | 5.79m at 2.39g/t Au | 541.71 | -65 | 294 |
| 4.70m at 4.58g/t Au | 550.3 | ||||||
| 20.94m at 6.74g/t Au | 681.86 | ||||||
| INC 4.68m at 16.48g/t Au | 687 |
4 Refer to Westgold’s Q2 FY24, Q3 FY24 and Q4 FY24 Quarterly Reports on ASX for full South Junction drill results
APPENDIX C – JORC 2012 TABLE 1 – GOLD DIVISION SECTION 1: SAMPLING TECHNIQUES AND DATA
(Criteria in this section apply to all succeeding sections.)
| Criteria | JORC Code Explanation | Commentary |
| Sampling techniques Drilling techniques Drill sample recovery | • Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling. • Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. • Aspects of the determination of mineralisation that are Material to the Public Report. • In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information. • Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc.). • Method of recording and assessing core and chip sample recoveries and results assessed. • Measures taken to maximise sample recovery and ensure representative nature of the samples. • Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material. | • Diamond Drilling A significant portion of the data used in resource calculations has been gathered from diamond core. Multiple sizes have been used historically. This core is geologically logged and subsequently halved for sampling. Grade control holes may be whole-cored to streamline the core handling process if required. • Face Sampling At each of the major past and current underground producers, each development face / round is horizontally chip sampled. The sampling intervals are domained by geological constraints (e.g. rock type, veining and alteration / sulphidation etc.). The majority of exposures within the orebody are sampled. • Sludge Drilling Sludge drilling at is performed with an underground production drill rig. It is an open hole drilling method using water as the flushing medium, with a 64mm (nominal) hole diameter. Sample intervals are ostensibly the length of the drill steel. Holes are drilled at sufficient angles to allow flushing of the hole with water following each interval to prevent contamination. Sludge drilling is not used to inform resource models. • RC Drilling Drill cuttings are extracted from the RC return via cyclone. The underflow from each interval is transferred via bucket to a four-tiered riffle splitter, delivering approximately three kilograms of the recovered material into calico bags for analysis. The residual material is retained on the ground near the hole. Composite samples are obtained from the residue material for initial analysis, with the split samples remaining with the individual residual piles until required for re-split analysis or eventual disposal. • RAB / Aircore Drilling Combined scoops from bucket dumps from cyclone for composite. Split samples taken from individual bucket dumps via scoop. RAB holes are not included in the resource estimate. • Blast Hole Drilling Cuttings sampled via splitter tray per individual drill rod. Blast holes not included in the resource estimate. All geology input is logged and validated by the relevant area geologists, incorporated into this is assessment of sample recovery. No defined relationship exists between sample recovery and grade. Nor has sample bias due to preferential loss or gain of fine or coarse material been noted. |
Westgold Declares Maiden South Junction Ore Reserve 13 August 2024