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Ferrex hits the ground running down under

Published: 07:30 04 Dec 2015 GMT

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The leases are owned by Norton Gold Fields, subsidiary of Zijin Mining Group

Initial field work has started on Ferrex's (LON:FRX) deposits in the heart of the Western Australia gold fields.

A detailed land survey is currently being undertaken to assess the existing drill holes and previous mining operations, which have historical resources of 5,741,155 tonnes at two grams per tonne (g/t) of gold for 363,599 ounces.

The survey will be used to finalise an initial, high priority, in-pit grade control drill programme before the end of December 2015, Ferrex told investors.

Ferrex will initially target shallow laterite and oxide deposits to generate near-term revenues. The deposits comprise previously mined pits with remnant economic material below the pit floor, previously yet-to-be mined near-surface deposits and other high-grade underground opportunities.

Ferrex aims to commence initial gold production of 20,000 to 30,000 ounces per annum in the second quarter of next year at the gold deposits, under a five year tribute agreement with the Zijn Mining Group.

"With limited work and capital required to commence gold production in Australia, we have hit the ground running in line with our target of delivering first production in Q2 2016,” said Dave Reeves, Ferrex's managing director. 

“A small-scale drill programme is set to start ahead of the New Year to formally confirm the grades identified as part of the historic resource of over 350,000 ounces of gold. This will provide plenty of news flow in Q1 2016, and we look forward to updating the market with this in the near term,” Reeves added.

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