A1 Gold Mine
As part of an 18 month worldwide business development review to acquire a near-term cash producer, Heron has secured an option on the A1 Gold Mine in eastern Victoria. The A1 Gold Mine historically produced some 450,000 ounces of gold prior to shutting in 1992 due to low gold price, high costs associated with antiquated mining practices and infrastructure, and bushfire damage to the plant. The A1 Gold Mine is an excellent near term production opportunity. Heron plans to construct an exploration decline as soon as permitting and approvals are in place. From this decline, Heron will be able to rapidly test and assess the resources available for development. Depending on the results of this test-work, Heron will be able to exercise the option and commence development form the exploration decline which will be large enough to allow production development should Heron elect to proceed. The primary target of evaluation is the previously developed stock-work mineralisation grading between 5 and 15 g/t Au. Previous lower mining grade cut-offs were 22 g/t Au and it is expected significant areas of remnant reefs and stock-works will be available for extraction. In addition there are good indications of strike extensions of the host dykes to the north and south and at depth.
It is envisaged processing will be by modular gravity plant minimising capital and operating costs. Development and geological evaluation of results from the decline will commence before year's end. Pending good bulk sample results, production could commence in two and a half years.
Heron maximises the success if the A1 Gold Mine by:
- The A1 mine is hosted in altered mafic dyke more akin to Eastern Goldfields of WA deposits;
- The resource geometry and distribution dictate rate of mining;
- Focus on grade, minimising dilution is key to profitable mining; and
- The processing mill will be tailored to the deposit, both metallurgicaly and rate of production.
Yerilla Nickel Cobalt Project
On 29 May 2009 Heron entered Framework Agreement with Ningbo Shanshan Co Ltd (SHA:600884; Shanshan) with respect to Heron’s Yerilla Nickel Cobalt Project. The Agreement provides for Shanshan to undertake a feasibility study into treating ore from Heron’s Yerilla Project utilising technology being provided by Shanshan, to produce a nickel and cobalt concentrate for further processing in China.
Shanshan, is one of world’s largest producers of materials for Lithium ion battery manufacture and as such is a significant end user of nickel and cobalt. Shanshan, is currently constructing a pilot plant at its facilities in the city of Changsha China to test the compatibility of Yerilla ore with its processing technology. A forty tonne bulk sample of Yerilla ore has been shipped to Changsha for this test work.
Heron will work with Shanshan during the pilot process to collect critical data for Australian project approvals.
Subsequent to a positive feasibility study outcome, Shanshan may earn a 70% interest in the Yerilla project by sole funding construction and commissioning of the project to an agreed capacity. For the full announcement click here.
![[photo]](images/photos/a1goldsample.jpg)
Gold sample from A1 Gold Mine
Briony Robertson, Investor Relations
Any enquiries at all, give Briony a call on (08) 9215 4444 or email.
