If you have not already looked at the following 11 September 2020 Havilah video (from 1.35 to 5.25 minute mark), I suggest you watch it before reading my response (it will make much more sense):
The sub-horizontal zones at the Kalkaroo deposit allow sequential mining of various mineralisation types to optimise processing plant utilisation.
Sub-horizontal stratification of the ore minerals from top to bottom, forming four main ore types, are as follows:
1. Supergene free gold in saprolite (Oxide Gold Cap), with generally minor copper, largely recoverable by gravity methods and cyanide leaching. [Oxide Zone]
2. Native copper and gold in saprolite, largely recoverable by gravity methods and cyanide leaching. [Oxide Zone]
3. Chalcocite (a rich form of copper sulphide) dominant with gold, recoverable by conventional flotation. [Sulphide Zone]
4. Chalcopyrite (a copper sulphide iron mineral) dominant with gold and locally rich cobalt and molybdenum, recoverable by conventional flotation. [Sulphide Zone]
The best option to minimise start-up capital costs is to commence mining of the Oxidised Zone ore at West Kalkaroo and recover free gold and native copper in a lower cost gravity processing and carbon in leach plant. West Kalkaroo is the best place to commence mining because of the higher gold grades and reduced overburden depths.
The purpose of the West Kalkaroo feasibility study is to provide clear answers to these and other critical questions relating to the economics of mining the West Kalkaroo Oxide Zone orebody.
Until the feasibility study is complete (Mincore Pty Ltd has delivered its processing plant design study with capex and opex estimates and the results have been incorporated into a preliminary financial model), it is probably premature to talk to potential financiers.
In the 19 November 2020 ASX Media Release, Havilah stated:
"Advance feasibility study and permitting work with the aim of commencing [West Kalkaroo] gold mining development activities during 2021."
Oxide Zone Ore - West Kalkaroo
The 3 stage gold starter open pit at West Kalkaroo captures 80,000-90,000 ounces of gold and as yet unquantified native copper.
At West Kalkaroo, the gold saprolite ore could be selectively mined and delivered to the gravity and carbon in leach ('CIL') plant. A low capital CIP plant, that is scaleable, would exploit both the base of Tertiary Namba clays and saprolite gold ore. That oxide plant could actually continue to process gold saprolite ore for the life of the main Kalkaroo mine.
The upper gold saprolite at West Kalkaroo is typically around 15-30m thick, with gold enriched to around 1 g/t. The gold is typically fine-grained and while gravity concentration could recover about 60%, cyanide extraction indicates a recovery > 90%. These saprolite zones are essentially porous clay material, of low strength, this should enable mining via free-digging (i.e. no blasting required).
When the native copper saprolite ore is reached the gravity plant would need to be increased in size to adequately handle this material.
Native copper
Native copper at Kalkaroo is almost pure copper metal (>99% Cu), and may be directly saleable to a refinery. Native copper could be transported in covered containers on a well maintained unsealed public road to the Barrier Highway and Transcontinental Railway, which are both roughly 50 km to the south of Kalkaroo. Options then exist to transport the product by rail or truck to Port Pirie or Port Adelaide.
There is minor copper (but insoluble) also located in the 'Oxide Gold Cap'. It is therefore not shown in either the JORC Mineral Resources or Ore Reserve numbers.
Cheers
These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.
HAV Price at posting:
18.0¢ Sentiment: Buy Disclosure: Held
(20min delay)