(MENAFN- ProactiveInvestors - Australia) Vector Resources (ASX: VEC) is finalising studies on a high grade toll treatment operation at its Gwendolyn Gold Project in Western Australia aimed at maximising margins and surplus cash flow.
A mining proposal has been submitted, with approval pending.
The studies will assess the technical and financial viability of toll treating ore from the high grade lodes at Gwendolyn.
As part of this, Vector has held advanced discussions with a nearby processor, the details of which will be disclosed when the findings of the studies are available.
The financial advantages of the toll treatment option are expected to receive a boost by the ability to target Gwendolyn's high grade lodes, which will further reduce operating costs, maximising margins and cash generation.
The studies will also include a detailed review of the Gwendolyn Resource to ensure the model is optimised for a high grade toll treatment project.
A new Resource model has been developed with five geological, alteration and structural controlled domains.
It is the most comprehensive and detailed resource model constructed to date.
Capital raising
To help fund the studies and other work at Gwendolyn, Vector plans to undertake a one-for-two rights issue at A$0.03 per share to raise $3.9 million.
Gwendolyn
The Gwendolyn Project consists of two tenements with historical gold mining. The tenements cover more than 487 hectares and lie within known gold producing areas.
Vector has been aggressively exploring this project over the last year which has resulted in an increase in the Resource.
Late last year the company uncovered gold grading up to 339 grams per tonne (g/t) from more reverse circulation drilling at Gwendolyn East.
Assays show Gwendolyn is continuing to give with near surface best intercepts including:
- 11 metres at 49.48g/t gold from 10 metres, inclusive of 1 metre at 114.5g/t and 1 metre at 339g/t;
- 3 metres at 8.82g/t gold from surface;
- 1 metre at 7.21g/t gold from 21 metres; and
- 12 metres at 4.14g/t gold from 15 metres.
Assays from this round of drilling identified another high grade chute to the south of the historic pit.
This intercept was just outside the current indicated mineralisation envelope.
Vector is continuing to target the near surface potential in all areas.
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