AverageJoe,I think we need to keep a sense of balance regarding...

AverageJoe,

I think we need to keep a sense of balance regarding the poorer than expected veins in close proximity to the Saga shaft.

Epithermal veins pinch and swell as a matter of reality and the Co-O area has been very geologically active over the millennium with complicated fault structures.

Their advance drilling had led them to expect fairly decent vein widths as they pushed out development on ore away from the shaft along level 8. As it has turned out, 3 of the nearby veins have apparently suffered structural impact from faulting and the veins were themselves thinner than expected (hence the reduction in planned ore and ounces for June).

But Co-O has multiple veins across 2km of strike. The base of the Saga shaft (-350m) sits below c. 1.25Moz of resource and Level 6 (-250m) is the principal mining area in that part of the mine.

They have said that they are pressing their development out from the shaft along Level 8 to find better areas for eventual stoping and that they will endevour to get a handle on the faulting local to the shaft.

Vein inconsistencies are part-and-parcel of epithermal systems. In the past we have seen the other extreme, ie when they have hit a wider area of 'black leaders' and have had the bonus of much higher grade ore. This latest report highlights the other side of the coin!

The whole point of gaining multiple stopes across the vein system and at multiple levels is that they will reach the point where the blended grade to the new mill can be sustained at a consistent 8g/t from multiple stockpiles at differing grades.

In this way the inconsistencies of specific mined areas in terms of vein width and grade can be smoothed out in order to maintain steady production levels.

They are only just reaching the beginning of their ramp up to the 200koz pa level. All being well, the wrinkles in mine and plant will be sorted out over this financial year.
CPDLC