The JV will be valid for up to 180,000 gold ounces extracted from the Yunndaga mining zone or five years from the start of mining at the deposit
Kingwest Resources and FMR Investments join forces to recommence mining at the Menzies gold project. (Credit: Alex Banner from Pixabay)
Kingwest Resources (KWR) and FMR Investments have agreed to create a joint venture (JV) to restart underground mining at the Yunndaga deposit within the Menzies gold project in Australia.
FMR Investments, which is an Australian investment organisation with interests mainly in the mining and mining related sectors, will have a 60% ownership in the mining and processing JV.
The remaining 40% in the JV will be owned by the Australia-based mining and exploration company.
The Menzies gold project is a historic gold field in Western Australia, located 130km north of the Kalgoorlie gold deposits. The Yunndaga deposit has a mineral resource estimate (MRE) of 57,000oz at 4.6 g/t Au or 79,200oz at 3.7g/t Au.
Kingwest Resources CEO Ed Turner said: “To recommence commercial mining at Menzies after more than 20 years since open cut mining finished and 85 years since it was last mined from underground at Yunndaga is very significant.
“This is expected to be the first of a number of mining operations at Menzies and to deliver attractive short-and medium-term cash inflow to KWR.
“KWR will continue to focus on the very exciting potential we are seeing at Goongarrie as well as proving up new gold resources at Menzies over time. I am sure there remains many more ounces of gold to be discovered at both projects.”
The JV will be valid for up to 180,000 gold ounces extracted from the Yunndaga mining zone or five years from the start of mining at the deposit, whichever occurs before.
Following the termination of the JV, full control of the Yunndaga mining zone and its operations will revert to Kingwest Resources.
FMR Investments will complete drilling from surface at its own cost for the purpose of due diligence within six months of signing the JV agreement.
Furthermore, during the term of the JV, FMR Investments will finance all the exploration, development, mining, treatment, and rehabilitation works at the deposit.
Another key term agreed by the parties is that milling of any ore drawn from the Yunndaga deposit will take place at FMR Investments’ Greenfields mill in Coolgardie. The charges of this will be covered by the JV at a fixed rate per dry metric tonne.