AuStar Gold (ASX:AUL) CEO, Tom de Vries provides an update on drilling from the Rose of Denmark Mine (RoD) where mining has commenced to extract material for processing and analysis.
Rachael Jones: Hello, I'm Rachael Jones for the Finance News Network. Joining me from AuStar Gold today is CEO Tom de Vries. Tom, welcome back.
Tom de Vries: Thank you, Rachael. It's good to be back.
Rachael Jones: First up to your announcement this week regarding the commencement of mining at the Rose of Denmark goldmine. What were the highlights?
Tom de Vries: Well, there's been a lot of activity at both Morning Star and Rose of Denmark, Rachael. And before I answer your question I'd just like to remind our investors that Rose of Denmark is now 100 per cent owned by AuStar Gold, we swapped Minjar Gold JV ownership at Rose of Denmark for AuStar equity. And this is important for a number of reasons. It demonstrates Minjar's confidence in AuStar Gold. It also facilitates our investors to fully share the rewards from Rose of Denmark instead of sharing it through a JV, and from an operational point of view, it allows the project to be agile, removing JV restrictions and any consequential time delays with JV.
In regard to the recent ASX announcement that you pointed out, your audience will be aware of previous releases about consistent visible gold intersections from our diamond drilling and the visible gold hits have been in many areas, not in single or isolated areas, and it's really used much more than a one hole wonder. These high grade intersections now represent an opportunity to fill the process plant and it also allows us to physically test, to fully understand what the final mine grade would be when we mine and process the Rose of Denmark material as a whole. So as soon as AuStar Gold became 100 per cent owner of the mining lease, we moved quickly to test some of the easiest drill holes by mining towards them and what you've seen in the ASX release is the free coarse gold that we're personally mining today.
It is what would be produced if we were to seriously mine Rose of Denmark and it is what the gravity process plant at Morning Star will process. So the announcement is very positive and very, very newsworthy.
Rachael Jones: So, Tom, clearly the plan is to mine sufficient ore to assess the potential at the Rose of Denmark. What does this mean for the mining plan given the characteristics of the ore body?
Tom de Vries: Excellent question, Rachael. It's exactly the reason why we have fast tracked the mining at Rose of Denmark, transferring the mining crew from the Morning Star to the Rose of Denmark. The dyke at Rose of Denmark is an entirely different animal from the Morning Star, the dyke and the rich letter veins in it stand near vertical. We think we can mechanise mine the dyke at the Rose of Denmark and this allows a higher rate of production and a lower cost, but first we need more data on the ore body by partially mining sections to get a bulk grade and then process that material to get an average recovery outcome, and this will set the economics of the mining method and the mine plan and pay a few bills along the way. To get a final mine plan we need to do further drilling to depth to get a full mine plan, but be assured that we're certainly moving quickly towards that.
Rachael Jones: And, Tom, would you remind our audience about AuStar's portfolio, including the extensive infrastructure assets?
Tom de Vries: Yes, Rachael. Despite the less than satisfactory results at Stacpoole, we still have made significant progress at the Morning Star and ensured full value of the site's assets. For instance we've commissioned the winder and the shaft to a standard that allows production including de-watering and ventilation. We've commissioned the process plant processing large parcels, lower grade material, recovered the available gold in it, and producing a lot of low tails grade. And we have and can place tailings underground successfully, which is crucial for ongoing processing. We have also further reviewed the Morning Star mining options and have identified multiple opportunities, which we are now diamond drilling. The objective is to get full value from the Morning Star shaft itself. And lastly and importantly, we have the confidence of the authorities of the community, of our workforce and ourselves that we can mine safely and continue to mine safely into the future, so our investors should have the confidence that we can utilise the full fare of the projects in infrastructure and not let it stand idle.
Rachael Jones: Last question, Tom. What can investors expect for the next update on the assay results from the most recent drilling?
Tom de Vries: Well, we are now currently diamond drilling at the Morning Star shaft. So we're presently drilling the maximal reef zone with a minimum of a seven old program, of which we've finished one hole and that is being logged in assay. At the moment. Other announcements on top of that, Rachael, which obviously will occur, will be our mining at Rose of Denmark, including a development average mine grade as well as the processing, which will probably start at the end of the month.
Rachael Jones: Tom de Vries, thanks for the update.
Tom de Vries: Thank you. Rachael. Talk again.