Mid‐tier gold producer and exploration company Gold Road Resources (ASX: GOR) has provided its 2021 production guidance, an updated 3-year mine outlook, its growth strategy for Gruyere and Yamarna, and the annual Mineral Resource and Ore Reserve Statement as at 31 December 20201 for the Gruyere Joint Venture (Gruyere JV).
The Gruyere JV is a 50:50 joint venture with Gruyere Mining Company Pty Ltd, a member of the Gold Fields Ltd Group (Gold Fields), who manage and operate the Gruyere gold mine.
Gruyere three-year outlook, 2021 guidance and growth strategy
HIGHLIGHTS:
3-Year Production Outlook
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3-Year production outlook1 shows a 35% to 50% increase in annual production and potential for significant free cash flow growth to sustain production of circa 350,000 ounces.
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Minimal capital expenditure required on process plant to achieve targeted throughput increases. Low AISC and CAIC maintained.
2021 Annual Guidance
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Gruyere gold production increasing to 260,000 – 300,000 ounces (130,000 – 150,000 ounces attributable) (2020: 129,087 ounces attributable) in 2021.
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Gold Road all-in-sustaining costs (AISC) between A$1,225 – A$1,350 per attributable ounce (2020: A$1,273 per ounce) in 2021.
Gruyere Exploration, Resource and Reserve Growth
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As at 31 December 2020, the Gruyere JV declared an Open Pit Mineral Resource2 of 6.7 million ounces at Gruyere and the Golden Highway.
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In February 2021, Gold Road estimated a 50% attributable maiden Inferred Underground Mineral Resource of 0.87 million ounces on extensions of the resource model beneath the current Gruyere Open Pit Mineral Resource.
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Updated open pit Ore Reserve scheduled for completion in second half of 2021.
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Drilling to target mineralisation below the reported Mineral Resources as an initial assessment of the longerterm underground mining potential.
Discovery
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2021 Discovery budget of $27 million (excluding Gruyere JV).
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2021 exploration strategy continues to focus on making a meaningful gold discovery at Yamarna.
Duncan Gibbs, Managing Director and CEO said:
“Gold Road aspires to be a long-life low cost and sustainable gold producer of circa 300,000 ounces per annum. The 2021 growth strategy aligns with this and focuses on realising shareholder value through optimising and growing Gruyere production at minimal cost as well as maintaining our strong focus on meaningful organic growth from our 100% owned Yamarna Exploration Project.”
Updated Mineral Resource and Ore Reserve statements
HIGHLIGHTS:
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As at 31 December 2020, the Gruyere JV Open Pit Mineral Resource totals 156 million tonnes at 1.34 g/t Au for 6.71 million ounces2 (constrained within A$2,000 per ounce pit shells), a slight increase of 0.1 million ounces (after mining depletion). The Resource includes:
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Updated Gruyere Open Pit Mineral Resource of 136 million tonnes at 1.31 g/t Au for 5.73 million ounces with mining depletion offset by Mineral Resource additions resulting in a net decrease of 0.06 million ounces.
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Updated Golden Highway and YAM14 Open Pit Resources of 20 million tonnes at 1.37 g/t Au for 0.89 million ounces representing an increase of 0.15 million ounces.
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Gold Road’s Mineable Shape Optimiser (MSO) evaluation at A$2,000 per ounce for Gruyere Underground constrains an inventory of 36.9 million tonnes at 1.47 g/t Au for a total of 1.74 million ounces from which Gold Road reports a 50% attributable Maiden Underground Inferred Mineral Resource of 18.5 million tonnes at 1.47 g/t Au for a total of 0.87 million ounces of gold.
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Gold Road’s attributable Mineral Resources increased by 20% from 3.61 million ounces to 4.53 million ounces (after mining depletion) largely through the addition of the 50% owned Gruyere Maiden Underground Inferred Mineral Resource. Gold Road’s 100% owned Yamarna Resources are unchanged and will be updated through 2021.
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Gruyere JV Ore Reserves largely unchanged at 87 million tonnes at 1.24 g/t Au for 3.48 million ounces.
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The Gruyere Open Pit Ore Reserve will be updated in the second half of 2021.
Duncan Gibbs, Managing Director and CEO said:
“The reporting of a Maiden Inferred Underground Mineral Resource is a meaningful advance in our understanding of the depth potential at Gruyere. Gruyere continues to show significant growth potential beyond the current 10-year Ore Reserve life. The underground resource, the existing drilling beneath it and the open pit mine, provide the impetus for a deep drilling programme below the Gruyere pit in 2021.”
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View the Gruyere three-year outlook and 2021 guidance and growth strategy
