Red Mountain Mining is close to completing the scoping study for its Batangas Gold Project in southern Luzon, which is now focused on the higher grade, near-surface South West Breccia resource at the Lobo prospect.

Red Mountain Mining managing director Jon Dugdale says, “The study is likely to demonstrate a low capital cost, practical, proven technology based gold project which would take advantage of existing high grade, close to surface, gold resources with demonstrated high recoveries from carbon-in-leach processing.”

The lower tonnage higher-grade focused processing plant is now planned to be located at Lobo, close to the SWB resource and the old Lobo mine.

The study, which examines the viability of a gold mining and processing operation at Batangas was originally focused on the Kay Tanda West resource at the Archangel prospect.

Jon Dugdale says, “Anything else that we discover at Lobo as a result of our current exploration program will potentially add to the current resource inventory and enhance the economic viability of the planned operation.”

The new focus at Lobo is expected to greatly reduce capital expenditure and minimize the environmental footprint whilst greatly enhancing overall economic returns.

Under the updated plan the processing plant will be close to the initial planned feed from the high grade SWB resource at Lobo.

The company will also target the highest grade ore at the Kay Tanda West resource at Archangel by transporting it about 12km by road to the Lobo processing plant following processing of the SWB resources.

The initial mining and processing project, the subject of the scoping study, will be entirely based on surface mining of existing higher-grade resources. Sedgman Ltd is finalizing processing capital and operating costs that are expected to be relatively low, particularly when initially processing the high grade SWB resources at Lobo.

Based on a highly positive expected economic outcome, Red Mountain will then contemplate committing to a bankable feasibility study and final permitting to fast track the project to production.

Surface exploration at the Lobo Prospect continues to return high grade gold results with the latest trenching extending the previous Trench 19 to 8.35 metres @ 18.3 grams/tonne gold from 4.9 metres @ 24.9 grams/tonne and new results from Trench 21 of 6 metres @ 31.2 grams/tonne including 1 metre @ 122.6 grams/tonne.

Preliminary results from drilling have confirmed the SWB lode extension with one hole returning an intersection of 1.5 metres @ 8.07 grams/tonne from 5.25 metres downhole including 0.5 metres @12 grams/tonne.

Resources have been defined for the SWB shoot, totalling indicated and inferred 194,000 tonnes @ 7.2 grams/tonne for 45,000 ounces. The company is focussed on increasing high grade resources through discovery of new, high grade gold zones at Lobo.

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