Thursday, 21 July 2011

Kalgoorlie Mining Company: Bullant Gold Mine to be void of water in two weeks

Kalgoorlie Mining Company (ASX: KMC) has been granted de-watering approval for the Bullant Gold Mine from the Department of Environment and Conservation.

The impact is Kalgoorlie Mining already has full de-watering activities underway in the lowest mine levels, with the company expecting to have these levels of the mine completely void of water within the next two weeks.

Water will be pumped into the Zulikia open pit located 800 metres to the north of Bullant from a number of pumping stations situated throughout the mine levels.

Importantly for the progress of the mine - on completion of the de-watering the mine is not expected to generate water, as the current body of water was caused by a rain event in the short time the mine was not in operation.

The Bullant Gold Mine - expanded landholding

Earlier in the week Kalgoorlie Mining increased the ability to reach the one million gold ounce resource at Bullant with the granting of additional tenements.

The wholly owned tenement area jumped 128% to over 27 square kilometres, following the granting of exploration tenements by the Department of Mines and Petroleum, which includes nine prospecting licenses.

Kalgoorlie Mining will now undertake detailed geological investigation of the entire tenement package to define exploration targets, with initial investigation highlighting only limited historical exploration work over the new area.

The additional tenement ground holding is another positive for Kalgoorlie Mining which follows hot on the heels of some good drilling results for the company.

The Bullant Gold Mine - high grade gold hits

The positive recent news flow for the company started earlier in the month, with the maiden surface diamond drilling intersecting high grade gold located just 300 metres from previous development, boosting the potential of extending the known resource to the south.

The highlights included 3.4 metres at 8.16 grams per tonne (g/t) gold from 284 metres, and 10.2 metres at 6.32g/t gold from 282 metres.

Drilling tested areas south of the historic Bullant Mine Development to both infill and confirm confidence in areas of historic drilling, while exploring for possible depth and strike extensions of the “Main Lode”.

The area is highly prospective due to the proximity to the old mine in an area that contained no drill information, while being located outside the known interpretation of the Bullant Lodes.

Kalgoorlie Mining is also eyeing gold production within months after recently executing a non-binding term sheet with an Australian subsidiary of Barrick Gold Corporation (NYSE: ABX).

The agreement is for the proposed sale of ore from the Bullant Gold mine to Barrick’s Kanowna Belle processing facility, where ore was treated previously when Barrick operated the mine.

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