Patagonia Gold plc (LON:PGD) is on track to start production at the open pit mine and heap leach processing facility at Cap-Oeste in Argentina in September.
The miner has received its environmental permit with all equipment and plant supplies now acquired.
Patagonia’s plan is to switch production to Cap Oeste from its current Lomada mine once construction is complete.
All Cap-Oeste ore produced from the open pit operations will be treated through a heap leach operation similar to Lomada, with the dore produced being shipped directly from the mine.
The forecast production for the project during the 24 month expected life of mine is estimated to approximately 82,000oz gold equivalent ounces, though Patagonia sees potential to increase the mine life with supply from satellite deposits such as Monte Leon and La Manchuria.
Drilling will start next month at Monte Leon, while Patagonia will also rework the project’s numbers based on the current gold price of US$1,350 compared to US$1,200 originally.
Metallurgical test work is also ongoing on the deeper arsenopyrite hosted mineralisation, with 92.3% recovery of gold into a 62 g/t cleaner concentrate with silver assays still pending.
More tests will be carried out to see if these high grade refractory ounces can be mined economically.
Lomada, meanwhile, produced 17,862 oz of gold in the first seven months to July, some 14% better than expected.
Gold production from the continued irrigation of the pad is now only forecast to continue for at least a further six months, as production has decreased faster than initially anticipated. But Patagonia is now looking again at the resources located in the southern end of the Lomada pit previously considered uneconomic in the light of the rising gold price.