Catalpa says Edna May gold mine ahead of schedule and within budget
One of Australia's newest gold mining operations is on track to make its first gold pour a month ahead of schedule in May.
Posted: Tuesday , 23 Feb 2010
Australian junior, Catalpa Resources (ASX: CAH) appears to be making excellent progress in bringing its fully-funded Edna May gold mine to production. According to the company's Managing Director, Bruce McFadzean, construction at the Western Australian gold project is around a full month ahead of schedule and within budget.
McFadzean says that ‘practical completion' of the construction phase is now scheduled for the second week of April and, as a result, the company is now scheduling its first gold pour in May, a month earlier than previously planned
In a statement today, McFadzean praised the contractors building the plant. "It is extremely pleasing that GR Engineering Services has been able to safely accelerate process plant construction giving us the opportunity to pour gold early. Power is scheduled to be switched on at the process plant this week allowing the systematic commissioning phases of the plant to commence in the weeks following." says McFadzean.
The A$92 million Edna May Gold Project is fully funded, and, as part of the finance facility, Catalpa has sold forward 352,316 ounces of gold at the excellent price of A$1,557.50 per ounce (equivalent to US$1,411/oz at the current exchange rate.)
At an average gold price of A$1,400/oz Catalpa estimates that it will realise an average cash operating margin of A$72 million per annum from the Edna May Gold Operations alone.
Catalpa has also managed to expedite other facets of mine development which will help it achieve early production. Mining is on schedule with approximately 100,000 tonnes of ore on the ROM pad. The tails facility is ahead of schedule providing for a 30% improvement on the planned tails capacity as outlined in the bankable feasibility study.
"Early production at Edna May will allow Catalpa to take advantage of our significant hedge price of A$1,557 per ounce and generate the cash flow to sensibly fund our own growth towards 250,000 ounces through exploration and acquisition," McFadzean said.