Kaiser Reef Ltd (ASX:KAU) traded higher after notching up a maiden mineral resource estimate (MRE) of 1.2 million tonnes at 4.4 g/t gold for 186,656 ounces at the Maldon Gold Project within the Victorian Goldfields.
Encouragingly, the initial resource estimate has exceeded the company’s expectations and will be the subject of mining studies with an engineering and geological team to be dedicated to investigating further drilling requirements and planning toward profitable mining at Maldon.
The company has also identified a conceptual exploration target of 1.75 to 2.7 million tonnes between 3 g/t and 4 g/t gold for 165,000 to 345,000 ounces.
Investors responded positively, sending shares as much as 15.15% higher to $0.19 and KAU has climbed from $0.145 at the market close on June 28.
Maldon is a major historic goldfield that has produced in excess of 1.74 million ounces at 28 g/t gold and with further exploration potential.
Granted Mining Licence
Importantly, Maldon's resources are within a granted Mining Licence that has extensive existing infrastructure including a modern decline of 5 x 5 metres.
Kaiser is permitted to mine at Maldon, however, an emergency egress will need to be established and some infrastructure will require review and testing, before predictable and profitable production. This work will now begin.
The Maldon decline portal is only 2 kilometres west of Kaiser’s wholly-owned gold processing plant, which is operating profitably but well under capacity.
Kaiser has the vision to develop the Maldon operations to become a two mine high-grade production company.
Recent drilling
The majority of recent drilling has targeted the historic high-grade mineralisation around the Alliance South Shoot lode within the Eaglehawk Reef, one of Maldon’s largest high-grade reefs that historically produced nearly 500,000 ounces of gold.
Kaiser's initial drilling program targeted regions identified as being close to the existing underground development and with historically encouraging results within the Union Hill decline.
This drilling has identified mineralised areas and will step out to explore for and define economic ore zones judiciously.
Project potential
Kaiser considers Maldon to be an underexplored and prospective prolific high-grade historic goldfield.
One of Maldon’s key advantages is the extensive existing infrastructure and proximity to Kaiser’s operating gold processing plant, and that it is held under a granted Mining Licence.
It has an established and serviced decline which allows easy underground access for drilling high-grade shoots. This is currently facilitating the underground drilling and ultimately, could allow the recommencement of modern mining if exploration is successful.
Maldon hosts one of Australia’s highest-grade historic gold mines, the Nuggety Reef, which produced 301,000 ounces of gold at 187 g/t.