Australia’s Westgold gets reserve boost from South Junction

Australia’s Westgold Resources (TSX: WGX; ASX: WGX) has replenished gold reserves at its Bluebird-South Junction mine complex with its first-ever reserve estimate for South Junction, in Western Australia.

Junction South which serves as the primary ore source for the Bluebird processing hub and is expected to enter production this month.

Westgold just completed the acquisition of Canada’s Karora Resources, valued at US$830 million, earlier this month.

The miner identified South Junction as a priority growth opportunity following the results of initial drill testing in early 2023. In January, it started a drill program aimed at extending and infilling South Junction.

Reserves total 225,000 oz. (2.6 million tonnes grading 2.7 grams gold per tonne), representing a sizeable portion of the 277,000 oz. (3 million tonnes at 2.8 grams gold) held at Bluebird-South.

Compared with Westgold’s 2023 year-end reserve count, Bluebird-South Junction reserves have now increased by 233%, or 158,000 oz.

The updated resource also exceeded the company’s interim estimate in March 2024 by a further 130,000 oz., post depletion of 14,000 ounces. This includes a 61% increase in the indicated resource category, for total measured and indicated resources of 4.7 million tonnes grading 3.1 grams gold for 465,000 ounces.

The Bluebird-South Junction complex is located in the regional town of Meekatharra, which encompasses Westgold’s central group of assets including several historic gold mining centres. These include the Bluebird underground mine, which returned to mining in the 2022 fiscal year. The run rate for this fiscal year at the Bluebird processing hub is forecast at 1.2 million tonnes.

The company’s quick expansion of the Bluebird-South Junction mining complex and the new reserve estimate speak to the value created by drilling, Westgold managing director and CEO Wayne Bramwell said in a release.

“A larger, more productive Bluebird-South Junction underground mine is a game changer for our Murchison business. It will reduce the requirement and cost of road haulage of ore from Cue (circa 140 km) as the Bluebird-South Junction complex is within 2 km of the nearby Bluebird mill,” he added.

Bramwell also noted that his company will continue to invest in drilling across its portfolio in fiscal 2025. Two surface rigs and two underground drill rigs continue to extend and infill the Bluebird-South Junction mineral resource.

Expanded portfolio

Westgold recently expanded its portfolio with the takeover of Canada’s Karora Resources and its Beta Hunt and Higginsville gold mines, both located in the same region as the Bluebird mine.

The combined company now operates six underground mines and five processing plants across the Murchison and Southern Goldfields regions. Together, its tenure covers more than 3,200 sq. km., and its facilities have a combined processing capacity of around 6.6 million tonnes per year.