Duketon gold mine: a future forged through growth

Regis Resources (ASX: RRL) reports a third consecutive year where underground growth outpaced depletion at its Duketon and Tropicana mines in WA, with major plans to ramp up and optimise its current undergrounds.

Notably, Regis intends to build sustainable capacity with four or more underground mines, by identifying and testing underground and open pit targets, to reach a target of 500kozpa combined production across its Duketon and Tropicana.

Regis has an operating set of infrastructure with three mills at the Duketon greenstone belt, totalling about six years of mine life.

Significant underground growth potential has been identified across Duketon, driving development of underground operations through Garden Well Main and the extension at Rosemont Stage 3.

In a May 2024 announcement of the development of the two underground mines, Regis Resources chief executive Jim Beyer said the company was confident in its ability to continue to expand its underground mining footprint.

“We are well on the way to operating four to five underground mines at Duketon to deliver sustainable gold production of 200-250koz of gold each year,” he said.

“While the growth in underground is a vital part of our value growth strategy we also continue exploring for additional high value, large scale open pits across our dominant holding across the Duketon Greenstone Belt.”

Regis has a track record of discovering and expanding underground reserves. Between declaring a Maiden Underground Reserve for Rosemont in 2019 and the end of calendar year 2022, Regis completed targeted exploration and resource definition drilling programs that successfully expanded its Duketon underground reserves by nearly 170% whilst also producing 151koz of gold from those underground mines.

Speaking at the recent Diggers & Dealers Mining Forum in Kalgoorlie, WA, Mr Beyer says the company has a history of increasing reserves while meeting production guidance.

“The reality is, for underground mines in WA, particularly the ones that come off the back of open pits, they tend to run with this cycle of being two years of reserves,” he said.

“Back in 2019 we declared the maiden reserve at Duketon of 123,000oz.

“Jump forward four or five years and our reserves have now increased to 335,000oz, so we have nearly tripled the reserves.

“During that time as well, we have produced over a quarter of a million ounces out of our undergrounds.

“This is sustainable, it’s real value generating.”

Current exploration activities indicate down plunge extensions of mineralisation at both Rosemont and Garden Well, which if successful will continue to add mine life and enhance value.

With Garden Well Main and Rosemont Stage 3, Regis will operate at least three independent underground mining areas within Duketon.

Regis’ pipeline of underground targets provides the Company with confidence of identifying up to two additional underground mining areas, delivering on its strategic objective of operating four to five underground mines.

“The development decision for these value accretive underground mines is another important milestone as Regis progresses on delivering into its underground growth strategy,” said Mr Beyer in the company’s May announcement.

“We continue to demonstrate the growth potential of our underground mines.

“At both Garden Well Main and Rosemont, we have again expanded our underground Reserves.

“Since we announced our Maiden Resource at Rosemont in 2019, each year, we have continued to enhance the value of the underground by increasing our Reserves.

“This is a trend across our underground mines that we aim to continue well into the future.”

Rosemont

Regis has been mining from the Rosemont underground, consisting of Rosemont Main, Central and South underground mining areas, since 2019.

Currently, Regis is extending the Rosemont South production area with infrastructure to support reserve growth and life extensions.

Primarily, ventilation is being added to the area to give access to the southern range.

The development of the ventilation portal will commence in the first quarter of FY25. It will expand the underground mineral resource from 435m to 735m below the surface to the south of the current Rosemont underground and establish key infrastructure for further growth beyond the existing mining inventory.

Mining is currently planned over four years using conventional long hole open stoping mining methods.

According to Regis, current exploration activities and knowledge of local geology indicate mineralisation extensions down plunge and to the south.

Regis plans to drill test the down plunge and southern extension opportunities once underground mining has been established.

The Rosemont Stage 3 underground development is based on a mining inventory that comprises 30% indicated mineral resources, 39% inferred mineral resources and 31% exploration target, or as yet unclassified material, for 1.7mt at 2.8 g/t gold for 157koz contained gold at 2.3g/t gold cut-off grade.

Rosemont Stage 3 will extend mining of the Rosemont mineralisation below and to the south of the existing Rosemont underground operations with potential optionality at higher levels.

Garden Well Main

Garden Well Main is located approximately 750 metres to the north of the current Garden Well South underground mine.

Regis Resources has established a 60-70kozpa production target for Garden Well Main, upon achieving steady state production from FY27.

“We have drills running off the end of the exploration decline furiously drilling that out to prove that up so we can bring that into production in about 18 months’ time,” said Mr Beyer in his recent presentation at Diggers & Dealers.

The Garden Well Main underground mine will open a new mining domain located directly below the base of the current Garden Well open pit with resource definition drilling delineating mineralisation from between 250-500m below ground level.

Pre-development access is from the existing Garden Well South mine, which has established power, ventilation, water and mine access.

Early development is focused on establishing the dedicated portal decline and fresh air raise and return raise positions for access and ventilation.

Current exploration activities and knowledge of local geology indicate mineralised extensions down plunge of the current underground mineral resource. Down plunge opportunities will be drill tested once underground mining has been established.

Garden Well Main will be mined by longitudinal retreat stoping with backfilling the voids and is based on bottom-up panel mining to improve productivity as independent working areas will be established.

Each panel has four levels with a 25m interval between each level.

The development and stoping schedule across the life of mine has been sequenced to allow for a relatively rapid extraction rate of the mining inventory with an annualised mining rate of up to 900kt.

Drilling at Garden well has confirmed multiple strongly mineralised zones, according to Regis.

The current Garden Well Main mining inventory comprises 36% indicated mineral resources, 24% inferred mineral resources and 41% exploration target, or as yet unclassified material, for 3.2mt at 2.8g/t gold for 295koz contained gold at a 2.2g/t cut-off grade.

Delivering on sustainability

In addition to extending mine life, Regis also made significant progress in reaching its ESG targets.

“We have been delivering on some meaningful improvements in the ESG space,” Mr Beyer said in his presentation at Diggers & Dealers.

“Our LTIFR for the last 12 months was zero, which anybody who has been in operation understands that that’s quite a significant milestone — one you can never rest on, you just look at it as you run past because you’re only as good as your next day.

“On the diversity front, we have improved our position and continue to build on our diversity in female representation.

“We also have been undertaking a considerable amount of work in improving the environment and lifting our workplace and safety culture.

“Our land rehabilitation has been lifting, we have rehabilitated just over 200ha last year.

“Some I think take the view that that’s something that can be left for later, but the reality is its appropriate and responsible to do that as you go.”

“On the renewable energy front and achieving our Safeguard Mechanism targets, we are running with a 9MW solar farm at Duketon, [whose] performance has been lifting over the last period.

“Finally, we have been building capacity with the local traditional owners at Duketon, with the Mantjintjarra Ngalia, with our Working Together Agreement.”

McPhillamys update

At the time of publication, the Federal Environment and Water Minister Tanya Plibersek has made a declaration of protection over part of the approved McPhillamys gold project site.

“I have decided to make a partial declaration under section 10 of the ATSIHP Act to protect a significant Aboriginal heritage site near Blayney, in central west NSW, from being destroyed to build a tailings dam for a gold mine,” Minister Plibersek said.

“If this site were to be desecrated, it would be a threat to the continuance of Wiradjuri/Wiradyuri culture.”

Minister Plibersek says her decision is not to stop the mine and that protecting cultural heritage and development are not mutually exclusive.

On the contrary, Regis says this decision impacts a critical area of the project, making the project non-viable.

Regis is now revisiting the $190m carrying value of the project and its ability to continue to report ore reserves.

At the time of publication, Regis is assessing the decision and is considering all options.