Pantoro Ltd (ASX:PNR) sees the first production at its jointly-owned Norseman Gold Project in the WA’s Eastern Goldfields in the third quarter of 2022.
The project is serviced by first-class infrastructure at the site, local shire and national infrastructure levels with everything required to begin mining already in place.
Infrastructure is generally in good condition and a new 1 million tonnes per annum processing plant is being constructed.
Pantoro has focused initial project planning on six initial mining areas containing multiple deposits which are amenable to both open pit and underground mining.
A Phase 1 definite feasibility study (DFS) detailed an initial seven-year mine plan with a centralised processing facility and combination of open pit and underground mining producing around 108,000 ounces per annum.
Approvals for the project were received in October 2021.
Processing plant
GR Engineering Services commenced pre-construction work at Norseman during the last half of September 2021 with a small crew on site.
Numerous structural steel components have been delivered to site while crushers have been delivered to Perth and mill fabrication has been completed and is being prepared for shipping.
Work is progressing according to schedule with a contracted 47 week completion time.
Pantoro is working with GR Engineering to identify potential time reduction opportunities given the advanced position with respect to equipment delivery.
Exploration and resource drilling
Pantoro has continued drilling at Norseman utilising four to five rigs throughout the quarter.
The majority of the work has been concentrated on the Scotia Mining Centre, resulting in mineral resource and ore reserve upgrades during the quarter.
It is expected that drilling with four drill rigs will continue for the majority of the December 2021 quarter ahead of a planned additional mineral resource and ore reserve update in the March 2022 quarter.
Once the current drilling program at Scotia is complete, the drill rigs will be relocated to the Mainfield with a focus on resource definition to enable ore reserve conversions in the near term.
Additional drilling is also planned at Lord Percy next quarter ahead of a mineral resource update and maiden ore reserve calculation.
Mainfield
Results received to date suggest that high-grade mineral resources and ore reserves from Mainfield will be included in future optimisations of the Phase One mine plan.
Mainfield will become a significant focus of drilling once the current drill program at the Scotia Mining Centre is completed later in the December 2021 quarter.
The focus of drilling in the Mainfield will be to define additions reserves suitable for inclusion in the Norseman mine plan.
Halls Creek Project
At the Halls Creek operations in WA's north, the company is exploring for mineralisation extensions at Nicolsons and Wagtail, together with a number of regional exploration targets.
Its strategy is to continue profitable production from Nicolsons and Wagtail and expanding mineral resources and ore reserves through an aggressive exploration strategy.
Pantoro owns the only commercial-scale processing plant in the Kimberley Region of Western Australia, providing a strategic advantage for the acquisition and identification of additional deposits in the area.
Quarterly results
Halls Creek Operations continue to reliably support the company’s development efforts at the Norseman Gold Project.
During the quarter, cash flow of $4.6 million was achieved from the production of 9,473 ounces of gold.
Production was in the upper half of the guidance range of 8,100-9,900 ounces.
All-in-sustaining costs were lower than guidance at $1,435 per ounce and higher than the upper end of guidance for net cashflow (guidance range $1.4–4.4 million).
COVID-19 impact
The COVID-19 pandemic continues to have a minor effect on operations, with the labour market continuing to tighten significantly.
The operations were well covered by other employees filling gaps where possible.
Lamboo PGE
The exploration highlight during the quarter was the identification of a large zone of platinum group mineralisation at the Edison prospect, about five kilometres south of Nicolsons processing plant.
A number of broad medium-grade assays were identified through re-assaying of existing drilling which was previously only sampled for gold.
Pantoro subsequently undertook a 2,500-metre RC drill program testing extensions to the mineralisation. All results from the new drill program remain outstanding.
Mary River
At Mary River, Pantoro completed a 1,300-metre WA Government co-funded EIS diamond drill program in the northeastern areas of the project.
Drill core identified the mineralised shear zone with mineralisation visually similar to the Reform prospect drilled by Pantoro in the southwestern area of the project.
Slattery
Pantoro has undertaken infill and extensional drilling at Slattery during the quarter, which includes around 1,900 metres of RC drilling. Results from the current program remain outstanding.
Grants Creek
Drilling at Grants Creek commenced subsequent to the end of the period and is likely to continue until the start of the wet season during the December 2021 quarter.
Several prospects will be targeted as part of the drilling planned including follow-up at Perseverance East and Panton Queen.
Maximus Resources stake
The market value of the 19.9% stake held in Maximus Resources Ltd (ASX:MXR) as at October 19, 2021, was $5.19 million.
Pantoro managing director Paul Cmrlec has joined the board of Maximus as a non-executive director, and operations director Scott Huffadine has taken the position of alternate non-executive director.
Global Credit Investments debt facility
Pantoro entered into a $30 million corporate debt facility with GCI in September which offers a flexible solution to fund the completion of construction at Norseman.
Funds are able to be utilised at Pantoro’s discretion across any of its projects, and the facility is secured by the assets of the Halls Creek operating facility and the assets of the parent company.
The facility was drawn in full subsequent to the end of the quarter, positioning Pantoro in a fully funded position for the construction of the Norseman project.