Vancouver – The latest drill program by Queenstake Resources (QRL-T) has increase the grade and tonnage of the La Prieta zone in the Samaniego Hill area of its 50% owned Magistral property in Mexico’s Sinaloa state.
An updated resource calculation completed by Denver based Pincock Allen and Holt has boosted the resources by 21% and the reserves by 26%. Using a 0.4 gram gold per tonne cut-off, the proven and probable reserves now stand at 6.98 million tonnes grading 2.07 gram gold. This is a marked improvement from the 6.16 million tonnes averaging 1.86 grams gold tabled in the 2000 feasibility study.
“We are delighted by the increase in reserves,” says company President, Chris Davie. “(The) increase in grade and decrease in strip ratio at Samaniego will dramatically improve the overall economics of the project.”
Total resources for the project come in at 11.8 million tonnes grading 1.48 grams gold. Of this, 9.1 million tonnes grading 1.69 grams gold lie in the measured category and 2.7 million tonnes averaging 1.4 grams gold are placed in the indicated section.
Construction is underway, with the completion date slated for late July. The company intends to enter production by October at the latest. The facility is being built to treat 1 million tonnes of ore per year, resulting in annual production of 40,000 oz. at a life-of-mine cash cost of US$180 per oz. The mine life is projected at 6.5 years. Based on current reserves and a gold price of US$300 per oz., the project should generate US$24 million in net revenue after preproduction capital expenditures. The stripping ratio comes in at 5.6-to-1, with recoveries averaging 73%. The ore will be mined from four discrete pits known as San Rafael, Samaniego Hill, Sagrado Corazon and Lupita.
“Significant exploration potential remains in possible extensions of the La Prieta zone, as well as in additional identified, but as yet not drilled, exploration targets on this 10,000 hectare property,” adds Davie.
Be the first to comment on "Queenstake ups Magistral"