Equal partners Queenstake Resources (QRL-T) and privately held Midwest Mining have shipped their first gold bar from the Magistral gold project in Mexico’s Sinaloa state.
Weighing in at 254 oz., the bar was sold at US$316.10 per oz.
Production at Magistral is expected gradually to increase over the next few months to the target rate of 40,000 oz. of gold annually. The mine’s production is not hedged.
Over its 8-year lifespan, the operation is expected to average a gold recovery rate (over a 240-day leach cycle) of 73%. The gold will be recovered in the adsorption and stripping circuits. Operating cost are expected to come in below the US$180 per oz. outlined in the project’s feasibility study thanks to the recent discovery of some additional reserves.
Highlights of a 8,500-mettrree drill program include:
- hole 744 — 34.5 metres grading 6.47 grams gold, including 21 metres of 9.45 grams gold;
- hole 736 — 33 metres grading 6.61 grams gold, including 21 metres of 9.99 grams gold;
- hole 748 — 40.5 metres grading 5.01 grams gold, including a 25.5-metre section which returned 7.02 grams gold.
At last count, Magistral’s proven and probable reserves were pegged at just less than 7 million tonnes grading 2.07 grams gold per tonne, for 465,100 contained ounces of gold.
The company plans more exploration, funded by Magistrals’s cash flow, aimed further increasing reserves. The company also plans to shop around for more producing gold assets.
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