Hitting development milestones and resource extension drilling is the dual imperative for companies progressing a mining project, at any stage, into operations.
Entering the ranks of Australian spodumene concentrate producers is the penultimate step for Core Lithium, ahead of completion and delivery of the Finniss Operation near Darwin in the Northern Territory.
Further south and across the border in Western Australia, Rox Resources’ ‘bonanza’-grade RC hit at Youanmi South has opened the door to another potential near-mine life-extender at the Youanmi gold project near Mt Magnet.
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This week, Core (ASX: CXO) announced it had completed construction of the Dense Media Separation (DMS) spodumene concentrator plant and that commissioning had advanced to the point where it was producing saleable quantities of concentrate in the build-up to a maiden shipment.
Concentrate will be stockpiled at Finniss while preparations are made for the first shipment. Once sufficient volumes are stockpiled, the concentrate will be trucked to Darwin’s port likely in late April.
This week’s news was a significant milestone for a company that purchased its landholding in the Bynoe pegmatite field just six years ago.
However, as with most mines in northern Australia, higher-than-average rainfall in December has impacted mining. Accumulation of water in the Grants pit has forced Core to revise forecast production volumes for FY23. With a couple of months left in the wet season, the full impact is yet to be fully assessed.
Commissioning of Finniss will continue while Core prepares for the first cargo of concentrate and then a second shipment likely in July.
Before companies can go down the building route, they need to secure the necessary mineral resource.
On the exploration front, investors are eagerly awaiting updates on drilling from the 2022 program targeting resource and reserve growth, especially at BP33 – the second proposed mine at Finniss – where assays received late in 2022 confirmed continuity of spodumene pegmatite, at depths up to 830m.
Core allocated $25 million for the calendar year to mine life extension, almost twice its previous annual commitment, and has promised a systematic, ongoing campaign to shore up the longevity of Finniss.
Core chief executive Gareth Manderson said the company’s success was underpinned by the dual strategy of establishing safe operations at Finniss and mine-life extending drilling.
“This approach has enabled Core to rapidly move the business to a position where concentrate production has now commenced,” he said.
“With construction complete, our focus moves to safely completing commissioning of the concentrator, delivery of our first cargo and the ramp-up of operations at Finniss that will deliver high-quality, reliable volumes of lithium concentrate into a favourable market.”
Eying a successful development story of its own, Rox (ASX: RXL) is busy advancing Youanmi near Mt Magnet.
And the Perth company demonstrated this week that there is still plenty of investor interest in gold exploration success – judging by the market feedback when Rox delivered its second drill-bit of good news in as many weeks from the ongoing 23,000m RC and diamond drilling program at Youanmi.
Two weeks ago, Midway emerged as an exciting new discovery just 300m from the hanging wall of the Youanmi main lode. Early signs hint that it could be higher grade than the main lode and significantly contribute to Youanmi’s overall gold resource.
This week, Rox reported an intercept of 28m at 34.81g/t from RC drilling at Youanmi South, just 250m to the south of the main lode. The company said there had been limited shallow historical drilling at Youanmi South, which was primarily drilled parallel to the 060-degree trending targeted structure.
Investors cheered – Rox’s shares jumped 58 per cent to 23c for the week.
Both Midway and Youanmi South are shaping as important targets for the company as it refines the Youanmi resource model. Drilling results from the program will be incorporated into a feasibility study, which is targeted for completion in late 2023.
Rox managing Director Rob Ryan said that Youanmi South was likely to play an important role in this year’s exploration program.
“The exceptional grade and continuous high-grade tenor of the intersection in an area previously untested by drilling is cause for cautious optimism while we determine the orientation of the mineralised zone,” he said.
“The results from Midway, and those reported here on Youanmi South, emphasise that Youanmi has the potential to deliver extensive resource growth with quality ounces through near-mine discovery.
“Our confidence continues to increase that Youanmi is a large-scale, high-grade system that is still in the early stages of understanding and resource evaluation.”