The first gold pour at the Tier 1 Gruyere mine in the north-eastern Goldfields, promising greenfields exploration and a long-term growth strategy were the key takeaways from Gold Road Resources’ (ASX: GOR) address to retail investors in Perth this week.
It has been a tremendous start to 2019 for Gold Road, with a share price that is up 15% since New Year’s Eve amid increased Australian institutional and retail investor interest because of the clear line of sight to first gold production – and therefore cashflow – from Gruyere, the world-class gold mine being developed in joint venture with South African major Gold Fields.
Addressing a full room of shareholders at the Westin Hotel on Wednesday night, chief executive Duncan Gibbs was joined by the board of the nation’s soon-to-be newest gold producer in kicking off a domestic and international roadshow focused on the group’s retail investor base.
The event showcased the progress of the Gruyere JV (which is set to pour first gold in the June quarter), Gold Road’s sizeable 2019 exploration plans for its Yamarna tenements that surround Gruyere, and the aspiring miner’s future ambitions.
“Our joint venture with (Gruyere JV partner) Gold Fields allows us to retain most of the exploration upside at Gruyere, which has a pretty simple geology system; it’s predicable and economical… and we can bulk mine it,” Mr Gibbs told investors.
“Gruyere is a simple open pit mine and a simple processing plant with conventional technology, just on a large scale. Overall, we’re looking at a lift in the production rate from the 275,000 ounces per annum that was announced in the pre-feasibility study to about 300,000ozpa.
“As we recently announced, construction at Gruyere is about 91 per cent complete, the primary crusher to coarse ore stockpile was commissioned last month and the powerhouse was commissioned in December. Our company is fully funded to first gold pour in the second quarter of this year, and we anticipate reaching nameplate capacity by the end of 2019.”
Outside of the immediate main focus of a safe and successful start-up at Gruyere, Gold Road has its eyes on finding the next million-ounce deposit or cluster of deposits that can underpin a mine development. The company is planning to spend $17 million to $20 million this year on greenfields exploration activities across its 100%-owned Yamarna tenements, including between 40,000m and 50,000m of RC and diamond drilling and aircore geochemistry across 40km2 to 60km2 of tenure.
“Our exploration efforts at Yamarna are squarely focused on defining deposits that will deliver us our next standalone ~1Moz operation that we wholly own,” Mr Gibbs said.
“So for us, 2019 is really going to be about completing construction of Gruyere and ramping up the mine towards full production while delivering some solid results at Yamarna that will pave the way for our next big operation.”