Name of the Project
Havieron gold project.

Location
Western Australia, 45 km east of Newcrest Mining’s existing Telfer operation.

Project Owner/s
Newcrest Mining, in a joint venture (JV) with Greatland Gold.

Completion of the prefeasibility study (PFS) triggers Newcrest’s entitlement to an additional 10% interest in the JV for a cumulative 70% interest. Newcrest has an option to acquire an additional 5% JV interest for fair market value, exercisable during the 12 months from December 12, 2021.

Project Description
Havieron is a high-grade, low capital intensity project with significant expansion potential.

Initial ore reserves are estimated at 14-million tonnes grading 3.7 g/t gold and 0.54% copper for 1.6-million ounces of gold and 73 000 t of copper. The PFS does not consider the 37-million tonnes of inferred mineral resources.

The project has received the necessary regulatory approvals for the construction of a boxcut, exploration decline and associated surface infrastructure, with these works officially starting in January 2021. The PFS has assessed the next stage of the project, which comprises the underground and surface development to establish the initial mining area at Havieron and ore processing modifications at Telfer.

The PFS envisages a capital-efficient, low-intensity development using existing Telfer processing infrastructure.

Telfer currently operates two processing trains with a total capacity of about 22-million tonnes a year. The Havieron ore is expected to be processed through a modified Telfer processing plant, which will operate a single train at six-million tonnes a year on a campaign basis.

The plant modifications are expected to include magnetic separation within the flotation circuit to reduce the amount of pyrrhotite in the final copper concentrate, and a carbon-in-pulp circuit on the flotation tail and cyanide detoxification circuit. A single-train operation also provides optionality if higher mining rates are achieved from Havieron or through the extension of Telfer’s current mine life. Tailings from ore processed will be deposited at the existing Telfer tailings storage facility.

Life-of-mine (LoM) average gold production is estimated at 160 000 oz/y of gold and 6 900 t/y of copper over an initial nine-year mine life. The project is expected to produce 1.43-million ounces of gold and 62 000 t of copper over the LoM.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a 4.5% (real) discount rate, of A$304-million and an internal rate of return of 16%, with a payback of four years from first production.

Capital Expenditure
The PFS estimated capital expenditure (capex) at A$529-million, which includes the expected cost of the Telfer plant modifications.

Planned Start/End Date
Not stated.

Latest Developments
Newcrest Mining reported on July 22 that it had less than 30 business days to decide on acquiring an additional 5% interest in the Havieron project for $60-million.

In its report for the quarter ended June 2022, Newcrest told shareholders that work was ongoing to progress the feasibility study at Havieron, and that the company was reviewing the impact of inflationary pressures on future capex and operating costs, with value engineering and other cost mitigation strategies already under way.

During the quarter, Newcrest continued with the development of the exploration decline at Havieron, however, the company encountered poor ground conditions.

Development advance rates accelerated, compared with the prior period, but continued to be significantly impacted on by unfavourable geotechnical and hydrogeological conditions requiring extensive local and surface dewatering, pre-excavation ground treatment and substantial ground support installation, Newcrest said.

Ground conditions have recently improved in line with the geotechnical modelling forecast, and a steady improvement in development rates is expected during the September 2022 quarter.

Changes in the design of the decline have been implemented bringing the first downward spiral to the current chainage, with better ground conditions being realised.

The schedule for first ore is under review and will be updated with the release of the feasibility study, which remains on track for completion during the December 2022 quarter.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Newcrest Mining, tel +61 3 9522 5333 or email investor.relations@newcrest.com.au.