PREPARATION of a maiden resource estimate for the operating HGZ Gold Project will enable Crater Gold Mining to refine mining methods for maximum gold extraction. The resource paves the way for increased production with minimal additional capital expenditure or development time.

The maiden inferred, JORC-compliant resource for HGZ, which is part of the Crater Mountain Gold Project, is 44,500 tonnes @ 11.9 g/t for 17,100 ounces of gold at a cut-off grade of 5 g/t and with potential for substantial increases.

As part of the resource definition, mapping showed three distinct major high grade gold veins, which are closely linked and estimated to carry 11,800 ounces of gold.

The company will refine the mining method from a higher cut-off grade of 7.5 g/t, implementing a revised, more focused mining plan, which will allow for more efficient, targeted gold production.

The plan will be implemented with the development of the 1930 Level via a new adit, which is being established.

Crater Gold’s technical director Richard Johnson said, “The maiden resource confirms the potential for profitable gold mining from HGZ. The report also provides more detail of the high grade veins, enabling us to target more selective mining of the veins going forward.

“Whilst the initial JORC resource may seem modest, the gold is accessible and all infrastructure is in place, allowing the company to move quickly to mining of the veins as well as other cross cutting structures.”

The estimate only considers the HGZ as identified to date. Development of the 1930 Level will pass through approximately 100 metres of previously unexplored ground adjacent to the high-grade zone, an area considered prospective for additional gold-bearing structures.

The potential to increase the resource is considered substantial given that drilling has mostly been confined to a maximum depth of 75 metres from surface and given that there is also evidence that gold is encountered at least to 128 metres.

Crater Gold plans to commence infill drilling this year from the 1930 level, which is under development.

The resource estimate was completed by Ian Taylor, of Mining Associates. The prospect was visited by Ian Taylor from September 26-30, 2016. During the visit, he viewed drill core, processing and storage facilities, and toured the underground workings, inspecting geology in the backs and walls of underground drives.