ASX ASX Announcement 17 November November 2016

Transcription

1 ASX: DRM ASX ASX Announcement 17 November November 2016 DEFLECTOR PRODUCTION MOVES TO TRANSITION ORE HIGH-GRADE GOLD EXPLORATION DRILLING COMMENCES Significant increase in gold and copper recoveries as production moves to transition ore First consignments of concentrate from transition ore shipped Underground development in West Lode exposes high-grade primary sulphide ore Commencement of production from primary sulphide ore remains on track for early 2017 Maiden exploration drilling campaign targets historic high-grade gold mineralisation at King Solomon/New Phoenix Doray Minerals Ltd (ASX: DRM, Doray or the Company ), is pleased to provide an update in regards to the Company s Deflector Gold Project ( Deflector ) in the southern Murchison region of Western Australia. Doray funded, built, and commissioned Deflector and commenced production of gold bullion and goldcopper-silver concentrate within 14 months of the acquisition of the project. Doray s Managing Director, Mr Allan Kelly, said that the Company was pleased with the progress of mining and production ramp-up and looked forward to the commencement of production from the primary sulphide ore in the new year. As predicted, gold and copper recoveries have increased markedly as we move into the transition ore and we are also seeing some very high-grade sulphide mineralisation being exposed with our first development drives, Mr Kelly said. We are also excited to have commenced our first exploration drilling campaign since acquiring Deflector, targeting historic high-grade gold mineralisation at King Solomon/New Phoenix, he added. Open Pit Mining nearing completion Mining of the open pit is progressing with approximately 90% complete at the end of October and production reducing to single (day) shift as the available work area decreases towards the base of the pit. The pit is now scheduled for completion in early Evaluation of a possible southern extension to the pit is ongoing, but mining of any extension would be deferred to a later date. Underground Development exposes high-grade primary sulphide ore Underground development is progressing on schedule with the decline and lateral access advanced 920m at the end of October. The decline has now advanced to the 1182mRL, approximately 98m vertically below surface (Figure 1). A total of 200m of ore drive development within the Western and Central Lodes has been completed to date, in preparation for the commencement of stoping in early During October, development of the first ore drives in the West Lode exposed high-grade primary sulphide ore on the 1200RL level (Figure 2.) This material will be stockpiled for treatment following completion of processing of oxide and transition ore.

2 Figure 1. Mining progress as at 14 November 2016, showing open pit progress and underground ore drive development in the West Lode (1200 level) and Central Lode (1185 level). Figure level ore drive in West Lode showing high-grade primary ore in laminated quartz lode (Diluted face grade 11.22g/t Au, 13.05% Cu and 91.17g/t Ag). 2

3 Processing and Production Production of gold (Figure 3) and concentrate (Figure 4) continues to ramp-up alongside optimisation of gold and copper grades and recoveries. The move from oxide to transition ore, along with ongoing metallurgical optimisation programmes in the flotation circuit has seen significant improvements in both copper and gold recoveries (Figure 5). The amount of native copper being recovered from the gravity circuit has decreased with a corresponding increase in the gold content of bullion being produced. Several options for realising the value of the gold in native copper middlings are being investigated including sale of the middlings product as-is and/or treatment to separate the copper and gold before subsequent retreatment into the concentrate and bullion respectively. Samples of sulphide ore from underground, representing the majority of ore to be mined at Deflector, are being tested in preparation for the start of processing in early Figure 3. Combined gold production (including from gravity, flotation and native copper middlings). Figure 4. Monthly concentrate production and shipments. 3

4 Figure 5. Gold and copper recoveries. Concentrate shipments Three consignments of concentrate were shipped during October, totalling 1,883 dry metric tonnes (Figure 4). The first of these was the final shipment of concentrate produced from oxide ore, followed by the first two shipments of concentrate produced from transition ore. Importantly, the sulphur content of the concentrate produced from transition material now routinely exceeds 17%, the threshold required to avoid penalties for low-sulphur content. Exploration drilling commences RC drilling has recently commenced on the King Solomon/New Phoenix target, approximately 6km from Deflector (Figure 6). King Solomon/New Phoenix is a series of three high-grade, narrow-vein, gold deposits previously mined as a small underground operation, which ceased in No systematic drilling has ever been undertaken on the prospect. This programme aims to both extend the delineation of mineralisation away from the extent of historic workings, as well as to test for faulted offsets along strike of both the King Solomon and New Phoenix lodes. It is expected that RC drilling will take approximately 3 weeks to complete. 4

5 Figure 6. Deflector project interpreted geology, showing the location of King Solomon/New Phoenix in relation to Deflector. -ENDS- 5

6 For further information, please contact: Cameron Peacock Investor Relations Doray Minerals Ltd +61 (0) About Doray Minerals Limited Margie Livingston Media Relations AMN Corporate +61 (0) Doray Minerals Limited is an Australian gold producer, developer and explorer with two new high-grade Western Australian gold assets: the Andy Well Gold Project, which commenced production in August 2013; and the Deflector Gold Project, which commenced production in May Doray has a strategic portfolio of gold exploration properties within Western Australia and South Australia and each presents multiple discovery opportunities. The Company's Board and management team has a proven track record in discovery, development, and production. 6