Transcription of Finance News Network Interview with MacPhersons Reward Gold Limited (ASX:MRP) Managing Director, Morrie Goodz.Clive Tompkins: Hello Clive Tompkins reporting for the Finance News Network. Joining me from gold explorer MacPhersons Reward
(ASX:MRP) is Managing Director, Morrie Goodz. Morrie welcome back. MacPhersons Reward has gold, silver, copper, zinc and lead projects. Where are they located and what is your stake in each?
Morrie Goodz: Well we have a number of projects that are centred around Kalgoorlie, so basically we are a project oriented company where Kalgoorlie is our focus. Our furthest project is 37 kilometres away, that’s our Coolgardie Gold Projects. We have a series of gold, silver and zinc projects and they’re based on the Nimbus Boorara shear zone which is located eight kilometres east of the Kalgoorlie super pit. So very close proximity, great thing about all our projects is we own 100 per cent of every project.
Clive Tompkins: Thanks Morrie. You acquired the Nimbus mill site last year and have recently acquired more tenements. What did you buy and from whom?
Morrie Goodz: Look we’ve been very fortunate to acquire some quality assets in through the Nimbus Boorara. Take up - they’ve come from a variety of public companies, a couple of private entities, some prospectors. Of course the biggest part of the project came from Reed Resources Limited
(ASX:RDR); we purchased the Nimbus mill and the Nimbus mine sites. We’ve purchased the main part of the Boorara gold deposit and the JORC resource from Polymetals Mining Limited
(ASX:PLY). And then we continued to negotiate with a number of other public companies in the area, just to acquire a continuous body of land along the Boorara sheer zone. So up until recently, we had 14 kilometres of strike length on the Boorara sheer which is a fantastic position. We were very fortunate in the last month to pick up another five kilometres of strike lengths through a series of tenements that had reached the end of their time. We were able to peg those tenements and start new applications from scratch without any acquisition cost, which was a fantastic opportunity for us. So in a nearly 20 kilometres on a goldfield that has mines up to 1,300 metres deep with 10 million ounce endowment, so we’re in the right area. And being eight kilometres from what is considered to be the biggest gold endowment in the world at Kalgoorlie, we figure we’re positioned really well for the future
for a great pipeline of projects.
Clive Tompkins: And Morrie, what has the latest drilling revealed?
Morrie Goodz: We have been incredibly fortunate with our drilling. I mean starting last year we had the Tycho discovery, essentially there were a few drill holes into it that had identified mineralisation. We’ve taken that to a 50,000 ounce JORC resource with the deposit outcropping on the surface, we’re looking at bringing that production within six months. So we’ve been really successful from day one. We went in and we redrilled the Macphersons Reward project at Coolgardie – fantastic results, we’ve now drilled over 100 diamond holes there. We have coarse visible gold reefs up to six metres wide, down over 300 metres below surface. It’s much bigger than we ever anticipated and it’s an ongoing project of review, we’re looking at a JORC resource update next quarter. But what’s really been in the news lately has been Nimbus. So we started the drilling there last October, we released our first results in January which were phenomenal. Our actual first intersection that we had results back on, were seven metres going 1,660 grams per tonne silver, 31 per cent zinc, seven per cent lead. We’ve now got back most of our results and what we’ve come to learn only recently, was that there’s this huge disseminated halo around the deposits that are actually carrying a significant amount of contained metal.
So in fact the release that we had on Monday was that one of our drill holes we just completed, 47 metres going 270 grams per tonne. It’s got zinc in it, it’s got a whole lot of other things in it and that intersection’s from 23 metres below surface. So it’s directly underneath and adjacent to the east pit, the east pit only goes down 40 metres. So we’re already starting to model what would be a cutback on the pit, to go out and collect this. We have 600 historical holes of which we’ve in the last three months, drilled 10 diamond holes to validate the database. Every hole has intersected massive sulphide mineralisation and this disseminated sulphide zone. So the results we released yesterday, we had a number of intersections between 40 and 60 metres going between 200 and 500 grams per tonne over the entire 50 metre width. So you know we never anticipated grades like that, let alone widths of such extent. What it’s delivered to us is a confidence level that not only can we support a major cutback there, but we would definitely be going underground after the pits are completed. And what it’s also given us is a new perspective on the repetition of these massive sulphide zones. So what we’ve actually learned is - and you always anticipate as a geologist that these things occur in clusters, they’re not one-offs. These are VHMS deposits, so they’re sheer zone hosted, very similar to the gold deposits and what you’ve got is stacked sulphide shoots in them. We’ve now identified nine separate shoots at the Nimbus deposit; we’ve got five other deposits that we’ve picked up in the Boorara tenements that already have drill holes in them and have identified the zinc and silver mineralisation. So the upside on this and again, the important thing in the pipeline of projects into the future, is actually looking really good in design of our plant. The geotechnical engineer’s got the go ahead for a new tailings storage facility – that’s the applications are underway on that, so we’re look at construction later this year. We’ve also appointed a metallurgist this week to start finalising the design and also we acquired the primary crushing circuit and leach circuits from the Tarmoola mill up at Leonora. So that’s in the process of being moved down to Nimbus and being set up for part of the recommissioning of our mill. And we’re looking at the parallel silver and gold circuits. So basically what we’re going to have is that the silver ore is going to be going through, first thing is our tailings reprocessing project. And then we’ve got the gold circuit which we are building, so that we can put in the gold ore deposits that we have at Coolgardie that we can actually direct, that feed to the Nimbus mill. As well as the gold deposits that we have at Boorara which are all within two kilometres of the mill. So you know that’s all moving forward - so you know, the drill results have been far greater than we anticipated and we’re really impressed. And we see this all coming together in our move from explorer to producer in 2012.
Clive Tompkins: And what are your plans for this year?
Morrie Goodz: So looking at 2012, the first cab off the rank for production is Tycho deposit and we’re going through the final stages of the planning. The pit optimisation’s essentially completed and we are looking at mid-year, starting to break soil on that project. We’re also looking at the silver tailings reprocessing from the east pit, that’s been a great find. We have to remove the tailings from the east pit anyway so we can do the cutback. When we actually sample the tailings, we found they’re going between 70 and 140 grams per tonne silver. That is higher grade than many primary deposits that are out there being mined at the moment, so fantastic grades. So we’ll have the gold coming on-stream, the silver coming on-stream, both planned for 2012. And then looking forward, we have that pipeline of projects to expand production with the view of 2014, having a sulphide flotation plant in place. So really we have these massive sulphide zinc deposits which are in the fresh rocks. After we’ve completed the pit cutbacks, we’ll be going underground to mine the primary sulphides and you know, just based on the forecast recently, we’ve seen that zinc is proposed to be the metal of 2014. And that timeline fits in perfectly with us getting the sulphide plant up and running and getting a zinc concentrate out by 2014. So we’re pretty excited on the plan forward.
Clive Tompkins: You’re also recommissioning the silver processing facility. When will this be complete and what does it mean for the Nimbus mill
site?
Morrie Goodz: The facilities are currently under reassessment for the final plant design. So what we’ve been doing through the diamond drilling
program is sending off composite samples for metallurgical test work, and that’ll finalise the flow sheet for the plant, for both the gold circuit and the silver circuit. That works underway and we anticipate the metallurgical test work to be finished in about three months’ time. We also have the geotechnical engineers that are designing the new tailings facility - that forms part of the critical past. So we need new tailings storage facility up and running before we actually can start the mill. The tailings storage facility, the planning and the permitting is about a three to four month process and then the construction will start on that. With respect to the plant, we’ve acquired a primary crush circuit and an additional ball mill for the plant expansion and a leach circuit. Those assets are ready to be moved to Nimbus and be put into place at the appropriate time when the flow sheet’s completed. Our anticipated timeline for getting all this work done is late 2012. So the objective is to have the plant up and running and be in production late in the year, and certainly everything seems on target. We’ve got - you know, it’s a big job ahead of us but we’ve put all the people into place, we’ve acquired a lot of the equipment. So the capital’s been spent, we’ve got everything lined up and it’s just a matter of going out there and getting the job done. And you know we’re pretty excited, 2012 is going to be a big year.
Clive Tompkins: To financials now Morrie. How much cash do you have and are you funded for 2012?
Morrie Goodz: Our cash position at the end of last quarter was $14 million in the bank; we’ve got absolutely no debt. We’ve got the bulk of our drilling programs have been completed to date and we are now in the feasibility studies. So we’re very comfortable with our position right now to have adequate cash in the bank to keep us going on the plan that we have for 2012.
Clive Tompkins: Lastly Morrie, where would you like to see Macphersons Reward by year-end?
Morrie Goodz: Clive by year-end, I’d like to see that we have two mines in production; I’d like to see that we both have a revenue flow coming from both silver production as well as our gold production. We’ve just brought on a new operations manager and that’s his brief, to get it up and running and he’s got a very successful track record at delivering, and we feel fairly confident. And certainly this time next year, I’d like to be standing in front of the Explorers Conference saying we’re now a producer.
Clive Tompkins: Morrie Goodz, all the best with the year ahead.
Morrie Goodz: Thanks very much Clive, pleasure.
Ends
