www.bassmetals.com.au
Bass Metals (ASX: BSM) is a growth focused and profitable Australian base and precious metal producer with a portfolio of high quality zinc, lead, copper and gold assets in the rich Mount Read Volcanic mineral belt in northwest Tasmania. Listing in 2005, Bass delivered its maiden profit in 2008 from its profitable base metals production hub at Que River in Tasmania, which has generated $25 million in cash flow over the last two years.
The Company also has an active and successful exploration programme and is currently following up on recent discoveries at Switchback and Fossey East which are high-grade and located in close proximity to existing mines and milling infrastructure. Bass has an experienced Board and operating team who have a strong track record of delivering profitable production underpinned by exploration success and are highly motivated to improve on that record.
The Company’s growth strategy centres on the development of a ‘pipeline’ of production, near-production and exploration assets in this prolific mineral belt, with strong leverage to a substantial new discovery through its extensive regional ground holding.
Bass Metals receives positive results from gold scoping study
Bass Metals (ASX: BSM) has reported positive results on processing options for the economic recovery of gold, silver and possibly base metals from the Hellyer Tails resource.
The results would indicate that an economic gold recovery circuit could be added at Hellyer in Tasmania.
Metallurgical consultants, BatteryLimits Pty Ltd and Como Engineers Pty Ltd undertook the study and the results have highlight the potential for significant gold production subject to further testwork and a positive feasibility study.
The study identified three gold recovery process routes as potentially viable for the Hellyer Tailings which contain 0.8Moz gold and 32Moz silver. The three Options comprise; Direct Cyanide Leach with Cyanide Recycling (Option 1), Albion Process (Option 2) and Partial Pressure Oxidative Leach (Option 3).
The capital cost estimates for each option were estimated as follows:
- Option 1: A$49.4m
- Option 2: A$143.2m
- Option 3: A$116.8m
Estimated operating margins were very healthy for each option:
- Option 1: 43%
- Option 2: 33%
- option 3: 47%
A conceptual annualised gold recovery of 21 to 72koz and silver recovery of 1.3 to 2.7Moz was postulated across the 3 process options and conceptual total site operating cost estimates range from A$743 to $877 per ounce gold (Eq (gold & silver only).
The resource contains 0.8 million ounces of gold and 32 million ounces of silver, which combined comprise a gold equivalent resources of 1.3 million ounces.
BatteryLimits has provided a metallurgical review, process descriptions, process schematics, and process design criteria for each of the three short-listed process routes. Como Engineers has estimated capital and operating costs for each option.
The study findings are largely based on detailed assessments of a vast repository of applicable historical testwork and feasibility studies on the Hellyer tailings originating mainly from the 1980’s and 90’s; not on hypothetical data.
The major changes to contribute to the current positive assessment compared to when the viability of recovering gold from the tailings was last assessed in detail (late 1990’s), include:
- A major uplift in the gold price to approximately US$1,100 - $1,200 per ounce, compared to the sub US$400/oz prices prevalent through the previous decade.
- Improvements in technology such as recent advances in cyanide recycling (Option 1), and engineering and operation of autoclaves (Option 3). Option 2, the Albion Process was
experimental in the ‘90’s but is now being installed commercially into several operations around the world.
- The potential resource base available to utilise the technology now includes more than just the Hellyer tailings, given the resource increments Bass has achieved over the past 5 years.
The results are preliminary in nature but do demonstrate potential for a viable new operational component at Hellyer to recover precious metals.
The indicative operating cost range from A$700 to A$900 per ounce (gold eq), while not “low cost” does assume a totally stand-alone operation with no synergies from other operational activities Bass Metals may be conducting on site such as the processing of its massive sulphide resources to produce base metal concentrates due to commence in December 2010.
On the basis of these positive results Bass intends to undertake a staged feasibility study process as a high priority. The first stage will focus on final process route selection followed by a series of detailed testwork programmes, process route design and cost estimates.
The focus will be the Hellyer Tailings, but as the testwork programme develops amenability testing of other potential feed stocks may also be included.
In conclusion, Bass said it is highly encouraged by the outcomes of the scoping study recently completed by Como Engineers and BatteryLimits.
Whilst still at a very early phase the study indicates the potential of utilising proven technologies to recover appreciable quantities of gold and silver and possibly also certain base metals which could significantly enhance the production and revenue profile of its business in Tasmania.
The company has to complete further large scale sampling and testwork programmes before committing to a definitive feasibility study to determine if such an operation could be viable and how it might be implemented.
Bass said setting the staged gold recovery study objectives and budgets is now a priority.
