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After $24M of CapEx, Kaiser Reef (ASX:KAU) said on Wednesday it’s pivoting into a new mode of operating with an untapped gold zone called ‘Nova’ hit by drillers.
The company has been enacting what it calls ‘remnant mining’ on historic underground workings for the last 30 years, given the first 100 years of operations at the A1 Gold Mine used the best ore.
The mine has been operating, more or less, since 1861. And Kaiser’s geotechs are convinced they’ve just unlocked a path to a new story for the mine.
“Most of the ore was exploited … modern remnant mining over the past 30 years however has been limited to producing less than 237 ounces per vertical metre,” the company wrote.
“Kaiser has now reached a critical target, termed the “Nova Zone,” which has never been mined before.”
The company’s workers have reached new levels underground not yet mined with ore in-situ, untouched for millions and millions of years. Power systems have been upgraded with ventilation works ongoing modernised facilities being planned.
Diamond drilling is also on the company’s radar in the coming weeks and months.
“Significant capital expenditure, estimated at over $24 million, including supporting infrastructure, has been invested to reach these new levels.”
“The transition to mining the primary ore, with the best material not having been previously mined, and access to the potentially substantially higher ‘ounces per vertical meter’ enjoyed historically is a major achievement.”
Management pointed towards potential for increased production from A1 in the near future.
KAU last traded at 17.5%.
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