ASX-listed Great Boulder Resources (GBR) has signed a memorandum of understanding (MoU) with TSX-V-listed Monument Mining for collaboration to potentially process ore from GBR’s Side Well gold project, in Western Australia, through Monument Mining’s Burnakura mill, subject to availability.

GBR says the agreement provides a pre-emptive right for GBR ore for toll milling.

The company says results from a GBR scoping study on the Ironbark deposit and Monument Mining’s scoping study into restarting the Burnakura mill will be shared to enable optimisation of both projects.

Monument’s gold mill at Burnakura is about 48 km south of Meekatharra, in Western Australia.

It previously operated at a capacity of 260 000 t/y until its closure by Kentor Gold in June 2013. The mill has remained in care and maintenance since that time.

Monument is now considering restarting the mill at its previous throughput rate, with an option to increase capacity up to 750 000 t/y.

“This is a very exciting step for our Side Well gold project as it provides a clear path for ore processing as soon as we complete scoping and feasibility studies and have the regulatory approvals in place.

“I’d like to thank the president and CEO of Monument Mining, Cathy Zhai, for suggesting earlier this year that GBR consider Burnakura as a processing option. Since that first meeting it has been a very simple process to negotiate the MoU to provide a win-win outcome for both companies.

“We look forward to working closely with Monument as we advance our respective gold projects in the Murchison,” says GBR MD Andrew Paterson.

GBR says the MoU with Monument is a nonbinding agreement setting a framework for the two companies to evaluate the sustainability of the Burnakura plant to treat GBR’s Side Well ore, assess the technical, commercial and logistical requirements for joint operations or toll treatment where applicable and negotiate commercial terms for ore treatment at Burnakura.

With both parties undertaking scoping studies on their respective operations, the MoU allows GBR and Monument to collaboratively share scoping study outputs enabling optimisation of mining and ore processing.

The MoU also allows collaboration on each company’s area of technical expertise, including GBR’s knowledge of local geology and gold mineralisation, exploration potential and local stakeholder relationships combined with Monument’s expertise in processing, mining and metallurgy.

In the event Monument wishes to use Burnakura’s milling capacity to toll treat third-party ore sources, GBR says the agreement provides pre-emptive processing rights for GBR, subject to availability.

During the course of the agreement, each company will remain responsible for its own study costs.

As announced in December, Monument has resumed technical and financial studies into restarting operations at its Murchison gold project, which includes gold resources at Burnakura and Gabanintha as well as the Burnakura processing plant.

The Burnakura study will consider restarting the mill at its current 260 000 t/y capacity or, alternatively, upgrading capacity up to 750 000 t/y.

Monument Mining has an estimated mineral resource – National Instrument 43-101 resource – comprised of an indicated mineral resource of 4.04-million tonnes at 2.3 g/t gold for 293 000 oz, and an inferred mineral resource of 1.55-million tonnes at 1.8 g/t gold for 88 000 oz at Burnakura; and a historical mineral resource of 2.2-million tonnes at 2.2 g/t gold for 153 000 oz at Gabanintha.

GBR says Monument also has a 20% free-carried interest in the Tuckanarra gold project.

NEXT STEPS

Air-core drilling is continuing at the Eaglehawk Prospect at Side Well, with a programme designed to define the dacite host unit further north and east of previous drilling.

The dacite running through Mulga Bill and Eaglehawk is a key host to high-grade quartz-sulphide veins.

Recently announced significant intercepts of 29 m at 4.79 g/t gold from 76 m, including a high-grade zone of 4 m at 20.50 g/t gold from 92 m and 8 m at 5.67 g/t gold from 103 m, including 3 m at 12.67 g/t gold are a great validation of GBR’s exploration targeting.

Ongoing results from this and other recent drilling programmes will be announced as they become available.