Cannon Gold Mine - 8th Processing Campaign

24 April 2017

Cannon Gold Mine – 8th Processing Campaign

  • 3,641oz. gold produced from WA mine in March 2017

  • Good recovery maintained at 90.1%

  • Subject to receipt of regulatory approvals, underground mine adit to be mined in May and ninth processing campaign in June

March 2017 Processing Campaign

Gold producer, Southern Gold Ltd (‘Southern Gold’) is pleased to report the results of the eighth processing campaign of ore treated during March 2017 (Table 1) from the Company’s Cannon Gold Mine southeast of Kalgoorlie in WA which is being managed by Westgold Resources Ltd (‘Westgold’, ASX Code “WGX”).

Table 1: March Cannon Processing Campaign (M25/333 Only)

UnitsEighth Campaign Project to date
Tonnes Milled (dry tonnes 40,180 555,290
Mill Head Grade Au g/t 3.08 2.96
Recovery % 90.10 91.10
Gold Produced oz.Au 3,641 48,217

When the results of this campaign are added to the seven previous campaigns, total gold produced at Cannon now stands at 48,217oz. gold. Current projections based on the new mine schedule incorporating the small underground adit estimate total gold recovery at approximately 52,000-53,000oz. gold at Cannon up to 30 June 2017.

Mining Update and Final Processing Campaign

Mining of the open pit is now complete. Mining of the small underground adit to extract the very high grade ore at the base of the pit will commence upon receipt of all regulatory approvals. This phase of mining of the Cannon orebody is currently scheduled for May 2017.

The ninth processing campaign of approximately 35,000t of Cannon gold ore is anticipated to commence in June 2017.

Next Steps at Cannon – Underground Potential

An update on the residual Cannon JORC Resource below the open pit is in process and preliminary mine designs will be based on this to potentially support a modest scale underground operation.

Southern Gold is exploring various options to drill deeper zones of the Cannon system to define additional resources and help confirm a potentially larger, longer life development option.

The results from this technical work, including underground development options under consideration, will be released in the coming months.