Bendigo expands new reef

Drilling by Bendigo Mining has extended a major new gold-bearing reef near existing mine development at the company’s New Bendigo gold project in southeastern Australia’s Victoria state.

Dubbed the Alexandria reef, the new find represents the largest gold-bearing reef identified at the project so far. Bendigo’s managing director Doug Buerger says the reef could be accessed within 12 to 24 months depending on development priorities.

In March, Bendigo reported strong mineralization in widely spaced holes, with "good continuity" over 460 metres. More recently, two step-out holes extended the reef some 240 metres to the south and 150 metres to the north.

In all, Bendigo says the results confirm that the reef is at least 900 metres long, 50 metres high and varies in width between 3 metres and 10 metres. Infill drilling to better pin down the grade of the reef is planned for later this year.

The Alexandria Reef is situated in the S4 ribbon on the Sheepshead line at a depth of 1,000 metres, some 150 m below the Swan decline.

Buerger also says that the discovery is significant in that it supports the company’s geological model that predicts the discovery of large productive reefs at 200-metre intervals at depth.

Late last year, Bendigo reclassified a substantial portion of the project’s 13-million-oz. potential into an inferred resource totalling 23.5 million tonnes grading 14.5 grams gold per tonne, calculated in accordance with Australian standards. Another 720,000 tonnes grading 10 grams gold are classified as indicated resources. The estimate also includes a probable reserve of 656,000 tonnes grading 9 grams gold, which is sufficient for only three years of operation.

The company says the cost of defining more reserves would be prohibitive, owing to the nuggety nature and depth of the ore.

Meanwhile, construction of an A$53-million 600,000-tonne-per-year processing plant at the south end of the project is underway. Commissioning is slated for the second quarter of 2006, with the first gold pour expected by the end of June 2006. Initially, production is forecast at 120,000 oz. per year, ramping up to 180,000 oz. annually as reserves are expanded.

Looking ahead, plans call for the development of a second decline and 1-million-tonne-per-year plant in the north to boost production to more than 500,000 oz. per year by 2011.