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  1. blaknyella

    176 Posts.

    A news item courtesy minesite.com for those interested:


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    Date : February 6, 2003

    Perseverance Corporation Could be One of The Leaders In Rennaissance Of Gold Mining In Victoria.

    It looks as if John Quinn’s bet that the oxide ore that Perseverance Corporation has been open cut mining in a modest way at its Fosterville gold project is underlain by a substantial mineralised system with potential to be developed and expanded as a significant gold producer is soon to pay off.. John Quinn is an experienced gold hand having been CEO at Newcrest Mining and Fosterville is only 20 kms east of the old and famous mining town of Bendigo in Victoria. As the man said, ‘if you want to find a new deposit look close to a mine’. Fosterville just about qualifies for the word ‘mine’ as it has produced 385,000 ounces of gold over the past ten years, but the oxide is now mined out and although gold is still being produced from stockpiled leach heaps, time is running out.

    During the quarter to end December a mass of drilling was carried out to infill the Phoenix Shoot over some 1,200 metres down plunge. This Shoot has already been identified by drilling over 1,600 metres down plunge and remains open at depth. The encouraging aspect of the closer spaced drilling was that it confirmed the earlier interpretation and remarkable consistency of the Shoot. As a result the resource has increased to 6.05 million tonnes grading 5.9 g/t gold to contain 1.15 million ounces of gold at a cut –off grade of 4 g/t. This is a 31 per cent increase over the resource announced six months ago and the Phoenix Shoot provided almost all of the increase.

    A high grade zone has also been identified in a number of holes drilled along the top of the Phoenix Shoot and one of these intersected 6.6 metres at 31.3 g/t from 182.5 metres down hole. This comes at a very good time as the prefeasibility studies based on production of 90,000 ounces of gold/year have only just been completed. The latest resource model will therefore be incorporated in the study which envisages an integrated open cut and underground mining approach with underground access via a decline to be developed from the existing open cut. The geometry of the mineralisation and the good ground conditions mean that it should be possible to mine substantial tonnages by open stoping which would be cheaper and more efficient than mechanised mining methods.

    At one time Perseverance was planning to treat the sulphide material by a bacterial oxidation process. Since then a 263 kg bulk sample averaging 5 g/t has been subjected to flotation tests. These showed that 98 per cent recovery could be achieved to a sulphide concentrate which then has to be oxidised. Three alternative processes were then tested with pressure oxidation tests at Lakefield-Oretest resulting in 99 per cent sulphur oxidation and 95 per cent gold extraction when subject to cyanidation. Activox oxidation tests showed sulphide oxidation around 97 per cent and 92 per cent gold extraction and the results from the Albion oxidation process have yet to be received. In addition five samples were sent to Gold Fields in South Africa for variability testwork using its BIOX technology.

    What seems certain is that gold recovery is not going to be a problem, but the company still has to make the right choice of process. John Quinn is in London doing the rounds at the moment, but unfortunately he had tied himself up in so many meetings that it proved impossible to make contact other than through voicemail. Clearly London is interested and the points that are impressing people are Quinn’s obvious confidence that the prefeasibility will prove positive as evidence by his intention to move straight on to detailed feasibility; the uplift in projected production to over 100,000 ounces/year; and the fact that the orebody seems to get richer as it goes deeper. As one broker commented after seeing a presentation, “He is in elephant country and may have actually caught one.”

    There is now real talk of a gold renaissance in Victoria which missed out on the boom times in Western Australia, Queensland and the Northern Territory in the 80s. In addition to Fosterville there are now four other projects which are leading thoughtful investors to forecast that the glory days could return and they are the New Bendigo project owned by Bendigo Mining and Harmony Gold, the Stawell mine owned by MPI, the Augusta deposit at Costerfield owned by AGD and Ballarat Goldfields. Interesting times as gold hits a new high.


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