monarch positive early studies at mount magnet

Monarch Gold: positive early studies at Mount Magnet

Company: Monarch Gold Mining Co Ltd (MARCF)

(RWE Australian Business News) Monarch Gold Mining Company Ltd (ASX:MON) has "hit the ground running" at the Mount Magnet Project with early optimisation studies delivering positive results for open-cut and underground operations.

Monarch agreed to purchase Mount Magnet from Harmony Gold in November 2007 and formally took possession of the project in April 2008.

The Mt Magnet project total resource stands at 28.2 Mt at 3.2g/t Au for a contained 2.9m ounces of gold, with 19.4 Mt at 3.3g/t Au for 2m ounces in the Measured and Indicated category.

Managing director Mr Ian Huitson said preliminary high-level scoping optimisation studies completed on 19 modelled open-pit resources at Mt Magnet had shown early potential to provide positive results.

Further work is required to confirm and realise the potential.

Resource modelling conducted at $A1000 per ounce and using current costs had returned positive cashflows of $111.8m.

"Ore tonnes generated totalled approximately 4.3m tonnes at an average grade of 2.4g/t gold, at average cash cost of $A640 per ounce and generated some 310,000 ozs of gold," Mr Huitson said.

"Work is now in progress to determine the scope to expand the individual deposits with further drilling, to upgrade the resource classifications and further refine the scoping studies," he said.

Monarch has also commissioned a high-level scoping study into the potential of re-opening the Hill 50 underground mine.

This study has indicated that at $A957 per oz and subject to confirmatory drilling, a viable underground mine exists.

On this basis the mine would generate an operating surplus of $16m a year over an initial three years, producing 50,000 ozs per year at a head grade of 8.8g/t Au.

rweabn.com.au

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Company: Monarch Gold Mining Co Ltd (MARCF)