- Kingwest Resources (KWR) is set to recommence gold production at its Menzies project after more than 20 years
- Mining at the WA project will resume following an agreement signed with Kalgoorlie private company, BML Ventures, to mine the Selkirk deposit within Menzies
- BML will cover the costs and be responsible for all mining and haulage and the companies plan to equally split profits
- Kingwest CEO Ed Turner expects this will be the “first of a number of mining operations at Menzies and is expected to deliver attractive short and medium-term cash inflow to KWR”
- Company shares are up 16 per cent to trade at 8.7 cents at 11:48 am AEST
Kingwest Resources (KWR) has entered an agreement with Kalgoorlie-based company, BML Ventures, to recommence gold production at the Menzies gold project in WA.
The mining agreement will specifically focus on open pit and underground mining at the Selkirk deposit which is a small gold project within the Menzies project and has a mineral resource estimate (MRE) of 11,500 ounces at 2.15 grams per tonne (g/t) gold.
The Menzies Gold Project historically produced 643,200 ounces of gold at 22.5 g/t from underground between 1895 and 1943 and a further 145,000 ounces of gold at 2.6 g/t open cut between 1995 and 1999.
Under the deal, BML will cover all capital costs and be responsible for all mining and haulage, as well as give Kingwest its operating and financial budgets for approval.
However, if the agreement is terminated before mining commences, Kingwest Resources will reimburse any costs BML Ventures incurs.
KWR CEO Ed Turner said he was pleased to have secured a mining agreement with BML as it’s the first step in unlocking the commercial potential of the greater Menzies gold project.
“To recommence commercial mining at Menzies after more than 20 years since open cut mining finished is significant,” Mr Turner said.
“This is expected to be the first of a number of mining operations at Menzies and is expected to deliver attractive short and medium-term cash inflow to KWR.”
The companies plan to equally split the profits from mining.
KWR shares were up 16 per cent to trade at 8.7 cents at 11:48 am AEST.