Gold producing Lachlan Star (ASX: LSA) has intersected some high grade gold at the Toro deposit, which is located within the wholly owned CMD Mine in Chile.
The drilling program at Toro was designed to increase the 272,000 gold ounce resource, while also targeting an upgrade in confidence levels - (currently 84,000 ounces Indicated and 188,000 ounces Inferred).
The peak intercept from the latest set of results is the high grade 7 metres at 12.09 grams per tonne (g/t) gold from 95 metres.
Importantly - the high grade hit was supported by broader intersections such as; 22 metres at 2.29g/t gold from 188 metres, and 31 metres at 0.90g/t gold from 118 metres.
The Toro deposit is located at the western side of CMD, and is currently being mined in three active pits.
Mick McMullen, chairman, told Proactive Investors today that mining for August was a record since the company took control of the mine, with strip ratios continuing to be around 3 to 1, with grades increasing.
June quarter gold sales of US$15.3 million
Gold production by Lachlan Star at the CMD mine is starting to ramp up, and in the June 2011 quarter the company delivered a 20% boost in gold production to 10,134 ounces with an average sale price of US$1510 per ounce - providing gross revenues of US$15.3 million.
The month of June produced 4250 ounces - the most for a month since the acquisition of the project. The C1 cash cost was US$841 per ounce.
A major plus to the June quarter production was 55% of the ore was sourced from outside of the JORC Resource.
The company has an unhedged production of around 45,000 gold ounces annually.
CMD is an open pit heap leach gold mine that commenced production in 1995 and has historically produced around 830,000 gold ounces.
Well-funded
Lachlan Star is also very well-funded, with a recent placement raising gross proceeds of $15.1 million.
Originally published at: http://www.proactiveinvestors.com.au/companies/news/19215/lachlan-star-intersects-7-metres-at-1209gt-gold-at-cmd-mine-in-chile-19215.html
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