WA miner Phoenix Gold looks set to make a tidy profit from its Blue Funnel gold mine as the project continues to progress on schedule.
Ore processing has begun under a toll milling agreement with FMR Investments at its Greenfields Mill in Coolgardie.
If the project continues to meet expectations, the total cash flow from the mine will be more than $3 million, based on the conservative gold price of $1350 per ounce.
Stage one of the project is expected to recover 85,800t at 3.52 grams per tonne of gold.
With the project requiring relatively small start-up and cash costs of $981/oz of gold recovered, Phoenix should make a healthy profit, which managing director Jon Price said would help in the short and long term.
“It is pleasing to report that mine development and operations for Blue Funnel are on track for a six to eight week processing program, which is a credit to the mining team and our local mining contractors,” he said.
“By commencing processing now we are leveraging off a strengthening Australian dollar gold price which provides us with the opportunity to increase our margins and deliver more cash into the business.”
Kalgoorlie based Phoenix Gold owns more than 600 square kilometres in the region including the Zuleika shear, Kunanalling shear and Ora Banda-Grants Patch goldfield – which all have multimillion-ounce potential.
All the projects are within a 50km radius of Kalgoorlie and existing infrastructure and transport, which would keep costs low. Phoenix has a 95 per cent stake in the Blue Funnel project and is part of the Broads Dam project area which covers a 14km strike of the prolific Zuleika shear.