Gibb River Diamonds (GIB) and contractor BML Ventures have commenced mining the Edjudina gold project in the Eastern Goldfields of Western Australia.
BML has been appointed to run operations and deliver the mineralised material to nearby gold processing plants. It has a proven track record of funding, developing, and operating open pit gold mines.
GIB said BML has worked extensively with local toll treatment operators to maximise profitability and cash generation from small- to medium-sized mining projects.
These include agreements for conducting mining operations with ASX-listed companies including Auric Mining and Horizon Minerals.
“The ore will be processed under new and existing BML toll milling agreements at mills around the goldfields,” the company said.
“Once project expenses have been paid with costs being re-imbursed from operational cashflow, the net surplus cash will be split 50/50 between GIB and BML on an ongoing basis until the cessation of the BML–GIB agreement.”
GIB acquired the Edjudina project in July 2020 and quickly discovered the significant Neta gold prospect (discovery hole was 36m at 4 grams per tonne (g/t) gold from 4m), which has now been the subject of a significant amount of drilling and metallurgical work.
The Neta prospect has an indicated and inferred JORC 2012 resource of 378,000 tonnes at 1.9g/t for 24,000 ounces of gold, including an indicated resource of 110,000 tonnes at 2.2g/t for 8000 ounces of gold.
GIB said it was not providing any capital or operating expenses for the project, and as such, carries minimal financial exposure to the project. Grade control drilling is taking place as a part of ongoing mining operations and is not being reported as a separate item.
The company said there are no forward sales locked in, and all production will be sold into the spot gold market.
Its lead project is the Ellendale diamond project in the Kimberley region of Western Australia. Ellendale previously produced over 50 per cent of the annual supply of the world’s Fancy Yellow diamonds, which were the subject of a special marketing agreement with Tiffany & Co.
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