Roka. Current reserves and resources present only a limited indication of how much gold is at Co-O and the prospective life of mine. This is a long life mine which is expected to be in production for the next 20 years or more.
This is because it a narrow vein mine not the usual gold mine which is open cast. For the past 7 years, since 2009, the probable reserves have hardly changed despite the 60-100k oz mined each year. This is because drilling each year proves up more reserves and resources but the drilling is most economically done not from surface but from lower levels within the mine.
Mine development extends now down to Level 8 which is 400 me below surface and is proceeding to level 9, 10 and in the future lower still. Drilling in the coming year will be from drill chambers opened up on the lowest level being mined - Level 8. This new drilling will likely add significant new reserves and resources down to Level 16 (800 me below surface) as well as extend the gold mapping along strike to the east as the gold veins dip and are open in this direction.
It is not economic for Medusa to drill up the whole resource at this time and prove up millions of oz of gold. Narrow vein gold mines in Australia have operated for 40-50 years with no more than a year or two of reserves at any one time. This is NORMAL for this type of mine.
MML Price at posting:
38.0¢ Sentiment: Buy Disclosure: Held
