WPG Resources Ltd's (ASX:WPG) subsidiary, Challenger Gold Operations Pty Ltd (CGO), has now received a $20 million loan facility from the Byrnecut Group.
The funds will be progressively deployed over the next few months mainly at the Challenger mine in South Australia.
Byrnecut is the mining contractor at Challenger, and is familiar with the operation as it was the contractor prior to WPG's acquisition.
WPG's plan is to de-emphasise short term high cost remnant mining in the older parts of the mine, and put more focus on developing into the Deeps which have the potential to be mined for many years to come.
Next steps
Byrnecut and its mining consulting arm Mining Plus have worked together during December to optimise the longer term production strategy at Challenger.
This optimisation study, which won’t be finalised until February 2018, will focus on developing into the virgin Challenger Deeps area.
Stoping will commence in February 2018.
Guidance
Due to maintenance issues in the mill and some under-performing stopes in the mine, along with the refocussed strategy of accessing the Deeps as quickly as possible, WPG outlined production for the December 2017 quarter will be lower than the previously released guideline.
WPG now expects the combined production from Challenger and Tarcoola for the December quarter to be circa 11,000 gold ounces.
Guidance for the combined Challenger and Tarcoola mining operations for the 2018 financial year is now 60,000 gold ounces.