MacPhersons backs the drill bit - and reaps the rewards
MacPhersons Resources (ASX: MRP) provided more evidence this week that the decision to embark on a major drilling program at its Nimbus silver-zinc-gold project near Kalgoorlie was the right choice.
MacPhersons, which is chaired by prominent Kalgoorlie publican and accountant Ashok Parekh, took the brave decision recently to delay completion of the feasibility on Nimbus so it could undertake an extensive drilling program aimed at growing the project’s inventory and mine life.
It appears the move is already paying dividends, with the company revealing this week that the drilling had established strong continuity of gold mineralisation between a series of planned open pits, paving the way for an increase in resources and reserves.
The drilling was undertaken at the Boorara gold deposits within the Nimbus project. MacPhersons planned to develop up to seven separate open pits at Boorara, which would provide gold ore for the heap leach operation at Nimbus, 2km away.
However, the latest drilling, which was done as part of the Nimbus feasibility study, intersected substantial mineralisation in the areas between the planned pits. This mineralisation is expected to have an average grade of about 1g/t, which is in line with the existing reserve grade at Boorara (3.3Mt at 1gpt gold).
In light of these results, MacPhersons believes it will reduce the number of open pits at Boorara to just two or three larger and deeper pits.
It now also expects to complete a resource update in the March Quarter of next year, with a reserve update and finalised mine plan to follow early in the June Quarter. This will then complete all the Boorara-related work needed for the Nimbus BFS, which is due to be completed in the June Quarter of next year.
The drilling programs are aimed at extending the overall project inventory and increasing the existing mine life beyond 5.5 years.
Success in growing the Nimbus inventory sufficiently to extend the project’s forecast mine life beyond 5.5 years, along with reductions in mining and processing costs, would in turn deliver significant benefits to the project’s overall economics, including shareholder returns.
MRP Price at posting:
22.0¢ Sentiment: Buy Disclosure: Held
