Bendigo mine study reveals possible $4.4b in gold

A close-up of a Santana Minerals rock core sample from Bendigo Station. PHOTO: MARJORIE COOK
A close-up of a Santana Minerals rock core sample from Bendigo Station. PHOTO: MARJORIE COOK
The company behind a mine labelled "the most significant single gold discovery in New Zealand in four decades" believes revenue of $NZ4.4 billion could be made in the lifespan of the mine.

Santana Minerals released a scoping study to the Australian Stock Exchange yesterday revealing key financial data and other metrics for its gold mine project at the Rise and Shine prospect near Bendigo and Tarras.

Based on the current spot gold price of $3900 per ounce, the mine’s revenue would be $4.4b.

It expected to make a net profit after tax of $2b. Total production costs would be about $1.6b.

The Australian-owned company estimated it needed six months to get through the permitting phase and a year to begin construction.

The mine would operate for eight years as an open-cast mine and for four years underground, recovering 1.12 million ounces of gold, the company said.

The Rise and Shine Strike is the most promising of four strikes within 5km of each other.

Drilling results have revealed thick, continuous, high-grade intercepts, traced 1.7km down-plunge.

The scoping study also listed the local infrastructure advantages.

There would be no fly in-fly out of staff or major camps required, it said. Nearby Cromwell had a 8000-strong labour pool and there was main road access from State Highway 8.

Queenstown International Airport was just a one-hour drive away, Lake Dunstan provided access to fresh water and the Clyde Dam supplied clean, green energy.

Indicative metallurgy showed free milling gold, recoverable by gravity followed by cyanide leach. These methods together were expected to achieve 91% to 94% recovery of the gold resource.

The report said there was "plenty more" to be discovered at the site.

The report showed three of six steps in Santana’s study stream into the commercialisation of the resource had been completed.

There was "a clear case" to move straight into pre-feasibility studies, the report said.

Two more steps would then follow — mine development and stakeholder engagement submissions and definitive feasibility studies, the scoping report said.

Santana’s study stream 2 related to more intensive exploration of the strike, including more drilling, mapping and geochemistry work.

It is not yet clear whether Santana would be able to apply for resource consent under the government’s Fast Track Approvals Bill, for which public submissions close tomorrow.