The Gruyere Gold Project was discovered by Gold Road in October 2013 on the South Dorothy Hills Trend, 25 kilometres north-east of the Company’s original Yamarna Belt discovery, Central Bore.
Within 10 months of Gruyere’s discovery, Gold Road had defined a significant high-grade gold deposit and announced a maiden JORC 2012 Mineral Resource of 96.93 million tonnes grading 1.23 grams of gold per tonne for 3.8 million ounces of contained gold.
The Gruyere Mineral Resource has since grown to 148 million tonnes grading 1.3 grams per tonne for 6.2 million ounces of contained gold, making it one of the largest undeveloped gold deposits in Australia.
After completing positive Pre-Feasibility and Feasibility Studies on Gruyere, Gold Road announced in November 2016 it would sell 50% of the Project to leading international gold producer Gold Fields Ltd for A$350 million in cash plus a 1.5% Net Smelter Return royalty on production over 2 million ounces.
The transaction fully funds Gold Road for its 50% share of development capital and de-risks the Project to a significant degree through the introduction of a partner highly experienced in the development and operation of open-pit gold mines that has agreed to cover any cost overrun up to 10% of the total development budget.
Under the Joint Venture Agreement, the Owner’s team assembled by Gold Road will transfer employment to Gold Fields and continue to manage the development of Gruyere. Gold Fields will also manage the operation of the mine. Gold Road retains responsibility for exploration on the Joint Venture tenements.
The Feasibility Study delivered by Gold Road in October 2016 see ASX announcement here envisaged a large-scale open pit mine feeding a 7.5 million tonne per annum processing plant and producing an average of 270,000 ounces of gold a year over an initial 13 year mine life.
The processing plant is expected to be powered by gas supplied to the site by a spur line connecting into the Goldfields Gas Pipeline.
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