Westgold Doubles Bluebird - South Junction Ore Reserve 107% increase in South Junction Ore Reserve to
ASX Announcement
4 December 2024
Westgold Doubles Bluebird - South Junction Ore Reserve
107% increase in South Junction Ore Reserve to 7.2Mt at 2.5g/t Au for 573koz.
Perth, Western Australia, 4 December 2024: Westgold Resources Limited (ASX: WGX, TSX: WGX, OTCQX: WGXRF – Westgold or the Company) is pleased to report a 107% increase in the Ore Reserve to 7.2Mtpa at 2.5g/t for 573koz at its Bluebird - South Junction mine near Meekatharra, Western Australia.
Highlights
Bluebird – South Junction Ore Reserve doubles to 7.2Mt at 2.5g/t Au for 573koz
- 107% increase (+296koz) from the August 2024 Ore Reserve - post mining depletion, demonstrates value enhancement from drilling.
- Ore Reserve underwritten by updated Mineral Resource Estimate (MRE) of 15Mt at 2.9g/t Au for 1.4Moz - featuring a Measured and Indicated component of 8.7Mt at 2.9g/t Au for 814koz Au (refer ASX release: “Bluebird - South Junction Mineral Resource Grows to 1.4Moz”).
Drilling programmes to be expanded across Bluebird-South Junction mining complex
- Surface and underground drill rigs focussed on infill and extension of the Bluebird – South Junction Mineral Resource. This system remains open at depth, along strike and down plunge.
New drill targets within 2km of Bluebird mill now being sequenced - including ■ Great Northern Highway (0.4km), Romsey (1.5km) and Ironbark (2.0km).
Mining studies focussed on maximising orebody extraction underway
- Widths of +20m at South Junction enables Westgold to move to a highly productive, high tonnage transverse stoping method – the benefits of which will see production lift during H2 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 has delivered a circa 400% increase in the Ore Reserve at Bluebird - South Junction over the past year. Drilling continues to transform our business, and across the Bluebird-South Junction mining complex we have not yet defined the limits of this ever-expanding system.
Project economics and free cash flow is enhanced by a large, productive underground mine feeding a large processing plant. We have all these ingredients at Meekatharra as the Bluebird- South Junction underground mine is the primary ore source feeding the 1.4-1.8Mtpa Bluebird processing plant that sits 0.5km from the portal.
With scale comes the opportunity to reduce costs with mine studies to-date showing that the South Junction deposit lends itself to a lower-cost, bulk extraction mining method that will deliver higher ounces-per-vertical metre – underpinning its potential to be a highly effective mining operation on the doorstep of our Meekatharra process plant.
Importantly the mineralisation at South Junction remaining open at depth, along strike and down plunge.
With multiple surface and underground drill rigs operating, Westgold is confident we will continue to extend and infill the Mineral Resource to further increase the life and expand the scale of this key growth driver in the Murchison. We look forward to providing updates on this work, as well as the ongoing mining studies at Bluebird - South Junction as we further increase outputs to >1.2Mtpa during H2, FY25.”
Figure 1 - Bluebird – South Junction underground complex showing footprint of current Ore Reserve.
Ore Reserve Growth
Since the substantial Bluebird – South Junction MRE scale and quality increase in November 20241, mining studies have been in progress, with a view to increasing the commensurate Ore Reserve, strengthening the Life of Mine (LoM) and extending output from the highly productive traverse primary / secondary mining sequence that has now been adopted at South Junction.
The Ore Reserve compilation component of these studies has now been completed, resulting in significant growth of the Bluebird South Junction Ore Reserve to a combined 7.2Mt at 2.5g/t Au for 573koz of produced gold (See Figure 2 below and Table 1).
This figure represents a 107% increase in the Ore Reserve post intervening mining depletion when compared to the end of August 2024 Ore Reserve (Table 2) 2, and a 382% increase to the Ore Reserve in the period of a year since the commencement of surface drilling activities at Bluebird - South Junction, when compared to the end of FY23 Ore Reserve for the project (Table 3)3.
573koz
Figure 2 - Substantial growth in Ore Reserve End of FY23 and November 2025 Ore Reserves.
Table 1 - Current Bluebird - South Junction Ore Reserve.
| Classification | Tonnes | Grade | Ounces | ||||
|---|---|---|---|---|---|---|---|
| (g/t Au) | |||||||
| Proven | 105,000 | 4.0 | 13,600 | ||||
| Probable | 7,141,000 | 2.4 | 559,000 | ||||
| Total | 7,246,000 | 2.5 | 573,000 |
1 Refer ASX Release “Bluebird - South Junction Mineral Resource Grows to 1.4Moz”.
2 Refer ASX Release “Westgold Declares Maiden South Junction Ore Reserve”.
3 Refer ASX Release “2023 Resource and Reserves Statement”.
Table 2 - Aug 2024 Bluebird – South Junction Ore Reserve including Maiden South Junction Ore Reserve.
| 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 3 - End of FY23 Bluebird Ore Reserve.
| Classification | Tonnes | Grade | Ounces | ||||
|---|---|---|---|---|---|---|---|
| (g/t Au) | |||||||
| Proven | 192,000 | 5.1 | 31,000 | ||||
| Probable | 566,000 | 4.8 | 88,000 | ||||
| Total | 757,000 | 4.9 | 119,000 |
South Junction Expansion Underway
As revealed by drilling, the increasing size and dimensions of the Bluebird - South Junction orebody and corresponding expanded available mining area has allowed Westgold to transition to a far more productive transverse open stoping approach in the South – Junction area of the mine. (See Figures 3 and 4 overleaf).
This transverse open stoping employs a primary / secondary extraction sequence and will enable Westgold to profitably extract a far larger portion of the Mineral Resource in South Junction than would otherwise be allowed by continuing with the conventional up-hole bench retreat approach applied in the Bluebird area of the mine.
The transition to high-productivity transverse stoping is already underway. The first footwall drives and accesses to drawpoints are under development, backfill and ventilation infrastructure placement has commenced, and initial stoping panels are being production drilled.
Ramp-up works will continue with the full benefit of these productivity measures being seen during Q3 / Q4, FY25. Westgold is devoting significant technical and management resources to ensuring the ramp up period is hastened while continuing to prioritise safety.
Figure 3 - The mineral endowment at South Junction remains open at depth, along strike and down plunge.
OUNCES PER VERTICAL METRE
0 5,000 10,000 15,000 20,000 25,000 30,000
REMNANT OPPORTUNITIES
MAJOR
0 RESOURCE
-50
-100
-150
-200
-250 -300 EXTENSION
OPPORTUNITIES
-350
0 50,000 100,000 150,000 200,000 250,000 300,000 TONNES PER VERTICAL METRE TVM OVM
Figure 4 - The South Junction deposit lends itself to a lower-cost, bulk extraction mining method, that will deliver higher ounces-per-vertical metre.
Figure 5 - Long-term ventilation infrastructure under development.
Next Steps
Westgold is continuing with its drill-out of the Bluebird – South Junction system.
Drilling from surface is continuing to extend the footprint of South Junction and Bluebird at depth and to the south along strike. These works are essential in not only defining the growing orebody, but also allowing for critical infrastructure placement to proceed with confidence. Drilling is also active in the underground environment, infilling the orebody to allow progressive Mineral Resource classification upgrades and to assist with mining execution.
These works will continue for the foreseeable future.
Additionally, planning works are underway to extend this drilling effort away from the immediate vicinity of the Bluebird – South Junction mine to proximal targets within close proximity of the Bluebird mill. The view is that opportunities such as Romsey (figure 7), Great Northern Highway and Ironbark (all within 2km of the Bluebird mill) may now be able to leverage the significant infrastructure and technical resourcing associated with the materially enlarged Bluebird – South Junction mining operation.
Importantly, this work will be resourced over and above currently planned drilling activities to ensure the rapid progress at Bluebird – South Junction is maintained.
In parallel, Westgold continues to optimise the Bluebird – South Junction mine plan. The current Ore Reserve has provided a significantly enlarged foundation on which to base operational plans. It has also provided a much larger footprint around which to tailor mine infrastructure solutions.
Westgold is confident that it can use this opportunity to further enhance its current transverse primary / secondary extraction sequence in South Junction. Results of this work will be communicated as they come to hand.
ENDS
This announcement is authorised for release to the ASX by the Board.
Investor and media relations enquiries:
Annette Ellis Investor Relations Manager [email protected] +61 458 200 039
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.
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 re-estimation 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 key inputs and assumptions are provided in Appendix D 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.
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 is considered a +2Moz system.
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 5).
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 planned to reduce as the Bluebird-South Junction mine expands.
Figure 7 - Westgold’s Murchison Asset Map.
Appendix B - Background to the Ore Reserve
The Bluebird portion of Ore Reserve will be exploited via centre access retreat longhole open stoping. The South Junction portion of Ore Reserve will be exploited via a highly productive primary / secondary transverse stoping method with fill. The combination of these methods 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.
Modifying factors have been applied to the Bluebird - South Junction reserve stope shapes that best reflect the appropriate extraction approach in each area of the orebody. These have been built from a first principles basis based on geotechnical recommendations alongside orebody dimensions and geometry.
Table 4 - Modifying factors used for Bluebird - South Junction Ore Reserve.
| Parameter | Value | Comments |
|---|---|---|
| Mine Operating COG | 2.1g/t | Assumes development complete |
| Full Costed COG | 2.3g/t | Incorporates initial and sustaining capital |
| Stope Recovery | 90% | Estimated based on size and dip |
| Stope Dilution | 10% | Calculated based on geotechnical parameters |
| Development COG | 1.0gt | Non-mining costs, assuming material hauled to surface |
Cut-off grades (COG) are based on realised cost profiles determined from the current Bluebird – South Junction mine and based on a gold price of $3,200AUD/oz.
Processing recoveries used within the mine plan are indicative of those achieved at the Bluebird plant currently. As Bluebird is an operating mine, environmental, and other governmental approvals are currently in place.