Horizon controls a number projects that can be developed into a sequence of high grade, low tonnage underground mines in close proximity to existing infrastructure that can be monetised through toll milling. The underground projects include Cannon, Penny’s Find and Rose Hill.
CANNON
The 100% owned high-grade Cannon underground gold project was acquired as part of the Bulong South, Glandore and Cowarna project acquisition completed in October 2021 for $5 million in cash. The project includes an historic open pit mined in 2017 and is located 10km east of Boorara via existing roads. Cannon is also close to other existing milling facilities, with the Lakewood plant being only 17km by road to the east.
Open pit mining at Cannon commenced in August 2015 under a profit-sharing arrangement with Westgold/Metals X who had acquired the adjacent Georges Reward tenement. The Cannon pit, under the Westgold JV, was based upon a 2015 Resource of 452,000t @ 3.9g/t for 56,000 ounces at a 0.7g/t Au cut-off. Mining was completed in June 2017 with 576,400t mined at 2.98g/t for 55,143 ounces.
Following acquisition by Horizon in 2021, the Mineral Resource Estimate for Cannon underground was updated by the company and stands at 226kt grading 4.4g/t Au for 32,330oz at a 1.0g/t Au lower cut-off grade.
A Pre-feasibility study was completed in early 2022 with key highlights being:
- Maiden Ore Reserve of 135kt grading 4.1g/t Au for 17,680oz
- Underground decline development from a portal within the historic open pit
- Ore processing via toll mill at 90% recovery produces 15,900oz
- Upfront capital costs of A$4.3m
- C1 costs of A$1,644/oz and AISC of A$1,873/oz using contract mining and haulage
- Generates net cash flow of A$10.1m over 16-month life at A$2,600/oz
The company is progressing approvals and tenders to underground contractors to progress the project into production. The company aims to develop a series of low tonnage, high grade underground mines to generate cashflow, with Cannon the first of a series of underground mines, followed by Penny’s Find.
PENNY'S FIND
Penny’s Find is located approximately 50km north-east of Kalgoorlie in the Eastern Goldfields of Western Australia in close proximity from the Company’s 100% owned Kalpini gold project and comprises granted mining lease M27/516 and associated miscellaneous and general purpose leases covering approximately 91 hectares. Penny’s Find is an advanced underground development project and currently a 50/50 JV between Horizon and Labyrinth Resources Ltd (ASX:LRL), with Horizon moving to 100% ownership imminently with Labyrinth agreeing to sell their stake in the project to Horizon.
Open pit mining at Penny’s Find was completed in 2018 with 18,350 ounces recovered from the treatment of 140,000t grading 4.5g/t Au with an overall gold recovery of 92.4%. Empire Resources Ltd (“Empire”) then commenced work on updating the underground mining resource and assessing mine optimisation and design.
Orminex Limited (now Labyrinth) acquired 100% of the project in May 2019 from Empire and completed further underground mine evaluation and design work, gained statutory approvals for mine development and independent assessment of further drilling required to improve geological confidence and convert current Inferred resources into the Measured and Indicated Category for inclusion in the reserve generation studies.
The high-grade gold mineralisation at Penny’s Find is hosted by quartz veins at the contact between sediments and basalt. Metallurgical test work has shown fresh mineralisation to be free milling with a high gravity recoverable gold component and a total gold recovery which has historically exceeded 92%.
The current Mineral Resource at Penny’s Find is 0.26Mt at 5.22g/t for 42,000oz at a 1.5 g/t Au cut-off grade. Conceptual underground mining studies have been undertaken, with further extension drilling planned for the September Quarter 2022.
ROSE HILL
Horizon acquired the Rose Hill project in late 2019 as part of the asset swap with Northern Star Resources. Rose Hill is located 0.5km southeast of Coolgardie and 35km west of Kalgoorlie-Boulder, and lies on the western margin of the Archean Norseman-Menzies Greenstone Belt.
The current JORC 2012 resource at Rose Hill is: 0.8Mt grading 3.7g/t Au for 93,300oz which is comprised of an open pit Mineral Resource of 0.3Mt grading 2.0g/t Au for 18,400oz at a 0.5g/t Au cut-off grade and underground Mineral Resource of 0.5Mt grading 4.6g/t Au for 74,900oz at a 2.0g/t Au cut-off grade. Importantly, 70% of the resource is in the Measured and Indicated JORC Categories. Further information on Rose Hill can be found in Coolgardie Regional.