Transcription of Finance News Network Interview with Commissioners Gold Limited (ASX:CGU) Exploration Manager and COO, Jason NeedhamDonna Sawyer: Hello I’m Donna Sawyer from the Finance News Network and joining me from Commissioners Gold
(ASX:CGU) is Exploration Manager and COO, Jason Needham. Jason welcome back to FNN.
Jason Needham: Hello Donna thanks for having me.
Donna Sawyer: For those not familiar with the Company, Commissioners Gold first listed on the ASX in September 2011 and is focused on generating projects in Peru. Can you tell me about those objectives that you have in Peru?
Jason Needham: Well our objectives in Peru will ultimately change over time. But at the moment, we’re really focused on acquiring and developing small gold production assets in southern Peru. In the future, I expect that we’ll be using those cash resources to develop larger projects and grassroots exploration. And ultimately for us in Peru, it’s all about having gold production underpinning our other activities both in Peru and at home, to minimise our exposure to market funding and shareholder dilution.
Donna Sawyer: The JV with Australia Gold Corporation has recently acquired the Saulito and Eladium projects in southern Peru. What’s the
strategy behind that?
Jason Needham: Well the joint venture with Australia Gold is really about assessing projects with four main attributes. That’s high grade gold mineralisation plus or minus silver and copper, near term production potential, scalability and low entry costs. Both the Saulito and Eladium deposits fairly meet those requirements that we’re looking for.
Both of those projects are small acreage. However, the deposits are already identified and we can really get into production almost immediately, in both areas. Ore sourced from both of those projects will be shipped to our Mollehuaca gold processing plant, which is located in the area and will underpin our production portfolio into the near future.
Donna Sawyer: Let’s talk about the Saulito project. What are the key points of the acquisition agreement there?
Jason Needham: Essentially Saulito’s a 30 year mining contract, where we receive 90 per cent of the extracted ore and the remaining 10 per cent goes to the local vendor. We’ve also got an option to purchase the project within five years.
Donna Sawyer: What sort of work is leading to the trial mining phase, and what is the Saulito project prospective for?
Jason Needham: Well at Saulito it’s all about planning at the moment. We’re working on mine engineering, production and cost forecasting and metallurgical recoveries at present. We’ve completed a first class geological assessment and really, our next stage is to understand the deposit better from a geological and mining perspective. Saulito’s prospective for high grade gold mineralisation, plus minor silver credits and up to 14 per cent copper in parts.
Donna Sawyer: Let’s talk about Eladium. What are the key highlights of that acquisition?
Jason Needham: Well the Eladium deal itself is very similar to Saulito. We’ve got a five year mining contract to acquire 90 per cent of the ore extracted, the remaining 10 per cent goes to the local vendor and we’ve got an option to purchase the project within five years. The Eladium deposit differs a little bit to Saulito in that, whilst it has very high grades of gold – up to 450 grams per tonne as assayed, the ore body’s actually inclined. So it’s a little bit more difficult to mine than the vertical ore bodies at Saulito.
Donna Sawyer: Eladium has infrastructure and approved mining permits. What sort of work has been done so far and what will the JV be aiming to achieve, in anticipation of executing a mining agreement for the project?
Jason Needham: Well really at Eladium, we’re doing similar work that we’re doing at Saulito. It’s all about mine planning at the moment - mine engineering, production forecasting, cost forecasting and metallurgical recoveries. We initially hope to complete an exploration drive that’s already been developed into the ore body. And essentially to drive into the ore body, poke around and get a good understanding of the grade distribution and the volumes.
Donna Sawyer: Looking across both projects, have you ascertained production targets and operating costs per ounce?
Jason Needham: With our production targets for both of the projects, they’re largely conceptual at the moment. And the work that we’re doing presently is really focused on taking those concepts through to a feasibility, to get them into production. Suffice to say that our production profiles need to match our capacity at the treatment plant. And we’re really looking to stage those production profiles necessary for the plant to process.
Donna Sawyer: Can you give us an update of progress on the commissioning of the refurbished Mollehuaca gold plant. What are the production expectations once it’s up and running?
Jason Needham: The refurbishment’s pretty much complete at the Mollehuaca plant. At the moment we’re actually function-testing most of the components in preparation for getting into trial production. The only outstanding item at the moment is our tailings fill, which has been a little bit delayed and it’s not ideal. But it’s actually given us the opportunity to work out some of the kinks in the plant itself. We’ve got a new plant manager who’s living at the plant at the moment, and he’s very busy sorting out the plant prior to production.
Donna Sawyer: Jason Needham, thanks for updating us on Commissioners Gold.
Jason Needham: Thanks for having me Donna.
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