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Jul 2009 - Avoca Resources

Avoca Resources Limited (AVO) –Moving into the 2nd Phase, targeting production of 150,000ozpa to 190,000ozpa for at least 10 years

  • Avoca has been advancing at a fast pace since discovering Trident in 2005 establishing sufficient ore (by June 2006), dewatering the Poseidon South open-cut and old workings by July 2007, start production, building and commissioning a plant within a year (by July 2008). And then producing ~130,000oz by June 2009.
  • Avoca has established that its 1mtpa rated plant is capable of treating ~1.25mtpa (and probably ~1.5mtpa with minor modifications) mainly due to the gravity circuit achieving ~60% of the recovery (double that expected). Which has paved the way for AVO to move into the 2nd Phase, bringing the satellites on stream such as Fairplay, Chalice, Two Boys, & Vine etc, and hence taking production into a targeted range of 150,000ozpa to 190,000ozpa for at least 10 years.
  • Avoca has given guidance of 190,000oz production for the coming year to June 2010, based on treating 1mt @ ~5.8g/t from Trident with a recovery ~97% for ~180,000oz at a cash cost of ~A$440/oz, and processing ~270,000t of low grade ~1.2g/t ore at a ~95% recovery for ~10,000oz at a cash cost of ~A$684/oz. However, the average Trident grade appears capable of being between 6.3g/t & 7.0g/t, and Fairplay may start production at ~2.0g/t possibly by January 2010.
  • The near vertical high grade Athena veins appear to be the mainstay of the Trident mine (blowing out periodically into the Western Zone) and becoming enhanced into bonanza grades when they are intersected by some of the high grade eastern flats (such as Eos) on the 1005 Level which has raised the average mine grade from ~3g/t to ~4g/t, up to ~6g/t.
  • AVO has submitted a revised takeover offer for Dioro of 1 AVO – for – 2.3 DIO (which has now been unanimously accepted by Dioro’s directors) as part of the 3rd phase strategy to increase production to ~250,000ozpa (although it appears likely to require up to two years to identify the underlying capability of the DIO assets). Avoca has a long-term stated target of becoming a 500,000ozpa producer.
  • Written by: Keith Goode
  • Thursday, 30 July 2009

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