The Fosterville Gold Mine is situated 20 km east of Bendigo, Victoria, Australia. The deposit is situated in the Bendigo Zone of the Lachlan Orogen in southeastern Australia, hosted in sandstones, siltstones, and shales. Gold was first discovered in the area in 1894 and intermittent periods of mining was undertaken until pouring its one millionth ounce in 2016. Increasing grade resulted in year-on-year growth until reaching 356 koz in 2018 at a whopping grade of 24.93 g/t.
The Fosterville Gold Mine operates solely as an underground operation. Current LOM contains 2,720 kt at 31.00 g/t to produce 2,720 koz over a period of six years. Underground mining is carried out using 20 m high stopes with widths between 2.7 m and 20 m. Cemented Rock Fill and Paste Fill is used where applicable. Recovery ranges from 71% to 86% and dilution ranges from 21% to 29%. Mill Recovery is 97%, produced at a LOM average cost of US$204/ounce.
| Classification | Tonnes (‘000 t) | Grade (g/t) | Ounces (‘000 oz) |
|---|---|---|---|
| Reserve | 2,720 | 31.0 | 2,720 |
| Resource (M+I) | 14,800 | 4.4 | 2,110 |
| Inferred | 10,300 | 5.5 | 1,830 |
Fosterville Reserves deplete quickly based on the LOM plan in place. While 2.1 Moz are classified as M+I Resource, they exhibit substantially lower grade. A cost of US$204/oz at 31.0 g/t increases the unit cost to US$1,431/oz at 4.4 g/t, resulting in difficulty in conversion into Reserve. It may also be challenging to maintain ounce production by increasing throughput amidst reduced grade. Mill capacity is 2,275 tpd, meaning if ore is fed at 4.4 g/t, annual production amounts to just under 120 koz. Unless Fosterville locates high grade material in the near future, ounce production will likely reduce.
The information presented above does not constitute investment advice. This is a summary from the NI43-101 Technical Report effective Dec 31, 2018 (INSERT), with commentary from the author. Statements above do not represent the views of Agnico Eagle. If any discrepancies arise, the information contained within the NI43-101 are official and final. For latest depletion data, please refer to the AIF update.