PNX Metals Ltd’s (ASX:PNX) (FRA:4P1) 100%-owned Fountain Head Gold Project feasibility in the Northern Territory is progressing towards a development decision in the second quarter of 2021.
The company has also finalised a sale and purchase agreement (SPA) with Ausgold Trading Pty Ltd to acquire the Glencoe Gold Deposit for a total consideration of $1.875 million, a ‘bolt on’ asset that has the potential to expand the Fountain Head development.
A resource update for Glencoe will be completed this month and incorporated into the Fountain Head mine plan along with Mt Bonnie gold and silver oxide mineralisation.
Finalise updated resource estimate
PNX Metals managing director James Fox said: “With the sale and purchase agreement for the Glencoe gold deposit nearing completion, the company will move to finalise an updated mineral resource estimate.
“These gold resources will be incorporated into the Fountain Head mining development schedule that also includes Mt Bonnie gold and silver oxides.
“The company has also submitted its mine management plan for dewatering of the Fountain Head pit and the project EIS is expected to be completed in early May this year.
“Both of these documents are critical path items for the Government and environmental approvals process.
“Como Engineers has also been engaged to provide guidance and input into the process plant design.”
Glencore acquisition
A $500,000 payment for the Glencore Gold Deposit was made in December 2020, with a further $675,000 due upon execution of the SPA, and the balance to be paid by December 31, 2021.
Ausgold is in the process of completing a ‘back-to-back’ arrangement with Ark Mines (administrators appointed) for Glencoe and other assets and PNX will execute the SPA on completion of this arrangement.
The Glencoe Mineral Leases are less than 3 kilometres north of Fountain Head Gold Project, which hosts a JORC 2012-compliant mineral resource estimate of 2.94 million tonnes at 1.7 g/t gold for 156,000 ounces.
Both projects are about 170 kilometres south of Darwin in the Pine Creek region of the Northern Territory.
Initial RC drilling
Statutory approvals are already in place for an initial 4,000 metres of reverse circulation (RC) drilling, which will start as soon as site access for the drill rigs can be re-established.
The NT has experienced an active monsoon across the Top End with persistent rainfall occurring on and around site and as such, ground conditions are being closely monitored.
Fountain Head development
The Glencoe deposit, along with the Mt Bonnie oxides (containing gold and silver) and Fountain Head gold deposit, form the basis of PNX’s proposed mining and processing development at Fountain Head.
A comprehensive body of work is underway to obtain government and environmental approvals and to inform a feasibility level study.
The company has engaged Como Engineers, a well-regarded engineering group with extensive experience in the design and construction of mineral processing plants and associated infrastructure, to draw up a gold plant design and input into plant capital and operating costs.
Its environmental consultants, ERIAS Group, has been working on the Fountain Head Environmental Impact Assessment, in particular, new technical studies pertaining to changes in the proposed development footprint and methodology from heap leaching to carbon-in-leach, and tailings management.
PNX is proposing to encapsulate dry-stacked tails within the existing waste dump footprint potentially saving significant time, cost, and reducing the environmental risk.
PNX’s current Fountain Head care and maintenance mine management plan has been updated to include dewatering the historic pit and has been submitted to the NT Department of Industry Tourism and Trade for approval.