Brightstar delivers golden DFS

Brightstar (ASX: BTR) has delivered a definitive feasibility study (DFS) for its Menzies and Laverton gold projects in WA, outlining up to $461m in pre-tax cash flow.

The initial production target spans 6.4mt at 1.81g/t of gold for 338,528oz over a five-year mine life, underpinned by the declaration of 4mt at 1.63g/t of gold for 210,500oz of open pit ore reserves.

Main activities considered in the DFS include open pit mining operations at the Lady Shenton deposit in Menzies and the Lord Byron and Corkwell Tree deposits at Laverton. Also included is the upgrade of the company’s Laverton Gold Plant to a nameplate throughput of 1mtpa capacity.

Outlined in the DFS is a defined, low-risk route to production that generates substantial cash flow with relatively low capital investment.

Brightstar’s managing director Alex Rovira says in parallel with its existing underground mining operations, the study outlines a low-capital and staged approach to building Brightstar into a meaningful mid-tier gold miner focused on the Tier-1 area of WA.

“The intent of the study is clear — move our Menzies and Laverton assets into production whilst undertaking significant contemporaneous exploration and development activities that supports continued production growth and mine life extensions,” he said.

“Beyond the study and expansion of Brightstar’s operational footprint, our exploration geology teams continue to build out our project pipeline.”

The company anticipates annual average production of around 70,000oz with continued resource exploration offering potential mine life extension.

Brightstar has also announced it is in merger discussions with Aurumin (ASX: AUN) to consolidate tenements in the Sandstone project area and has entered a non-binding agreement.

The merger would see Brightstar acquire Aurumin for scrip consideration and presents a consolidated mineral resource estimate (MRE) of 2.4moz at 1.5g/t of gold on granted mining leases across the project area.

The combination of assets presents an opportunity to de-risk and accelerate the development of the emerging gold project and provide greater certainty for the development of new infrastructure and unlock exploration synergies.