Classic's positive gold processing data may point to early revenues

By Trevor Hoey. Published at Jul 14, 2020, in Mining

Western Australian gold exploration and development company Classic Minerals Limited (ASX:CLZ) has reported promising results from a preliminary metallurgical test work program on samples collected from drilling at Kat Gap, part of the group’s Forrestania Gold Project (FGP).

The test work has been conducted on fresh mineral samples from the Kat Gap program, the area which was the subject of outstanding high-grade drilling results released just last week.

These included 4 metres grading 76.7 g/t gold from 79 metres.

The tests completed covered both conventional gravity and leach testing on the samples provided.

The results have been particularly encouraging as the material tested indicated that the majority of the gold could be recovered by traditional gravity separation techniques and with the mineralisation located from near-surface, this has the potential to provide a low processing cost option for the material.

Near-surface high-grade mineralisation has been a feature of drill testing completed at Kat Gap, and the company is in the process of completing further drilling which could well identify similar styles and grades of mineralisation.

These results take on even more importance given that management is working towards expanding the resource and conducting open pit optimisation studies that could see the commencement of early-stage production.

Classic has a solid base to build on at FGP with a global mineral resource of 8.2 million tonnes at 1.5 g/t gold for 404,000 ounces of gold, with a recent scoping study suggesting both the technical and financial viability of the project.

It could be argued that the inferred value of this resource, combined with the prospect of exploration upside and the potential to move to relatively near-term production isn’t captured in Classic’s market capitalisation of $28 million.

Conventional process delivers 95% recovery - early revenues

The conventional gravity separation process has delivered up to 75% gold recovery from the oxide samples with the conventional cyanide leach process providing 95% - 96% recovery from both fresh and oxide samples.

These results are extremely positive, and the next stage of testing is focusing on variability across the mineralisation and firming up the process options to consistently deliver the indicated recoveries.

The preliminary results indicate that Classic has the potential for early revenue generation through either toll treatment or self-processing of the material from Kat Gap.

The toll treating provides rapid cash flow while the onsite processing provides greater profitability as Classic can control all mining and processing costs.

Highlighting the combined benefits of resource expansion and promising processing information, chief executive Dean Goodwin said, ‘’After conducting detailed research we are fortunate to have found that the metallurgical results confirm that the ore, when processed using traditional gravity and leach processes provide an outstanding gold recovery.

‘’The recent results offer great hope that there is the possibility of gold deposits to augment and further enhance the gold resources already determined at Kat Gap.

‘’We will be working on extending the resource with more infill drilling and then expanding the resource with extensional drilling along strike as well as in the granite.’’

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X