Kentor Gold Strikes High Grade Gold at The Murchison Gold Project

Kentor have released an announcement on some really strong drill intercepts which form part of the Burnakura Gold Project. The highlights of the announcement include:

·         5m @ 102.2 g/t gold from 43m (incl. 1m @ 474.5 g/t gold)

·         17m @ 9.6 g/t gold from 43m (incl. 1m @ 103 g/t gold)

·         Potential to increase production and lower costs for the initial 2012 operation.

Those results on their own are strong for any mine in Australia, but are even more significant when you on consider than the estimated mine ore grade is currently 1.65 g/t. (i.e. significantly lower than these hits).

Also given the Burnakura is a high cost project anything that lowers costs or increases ounces mined is very important.

I posted this on Hot Copper which accurately describes to potential of increasing the average grade per tonne mined. The 3 g/t Au grade mentioned below is the average grade for Stage 1 which will source ore from four open pits including Lewis.

“the 24,000 oz (stage 1) is based on an average grade of 3 g/t Au. Now I am not sure how much we may be able to increase the average grade (if yesterday’s results continue) But some rough maths shows that if the grade increases to 4 g/t Au (even if it was just for year 1 or 2) that would equate to production of approx 32k oz in those years.

This is an extra 8,000 oz which at $1,600 AUD POG generates an additional $12,800,000 for essentially the same processing costs.”

As it is the grade that it is increasing, not the amount of material we process, any extra gold recovered is essentially bonus money that was not initially calculated as part of the stage one feasibility.

The announcement also says that the top 30 meters of the two drill holes have not been assayed so it will be interesting to see how they turn out.