In mid-October 2018, ERA visited Dacian’s mining operation at Mt Morgans over four days, being underground at Westralia, open-cut at Jupiter, the new MMGO 2.5mtpa rated (hard-rock) gold plant next to Jupiter and some of the exploration areas such as : Golden Cliffs, Maxwells and Cedar Island, plus a review of Cameron Well and the numerous potentially prospective historical workings (visible in Google Earth). The main components of Dacian’s operations near Laverton in WA are shown in Figure 1a, with an aerial view of the Jupiter Operations’ open-cut at Heffernans and the Mt Morgans Plant in Figure 1b. [This was ERA’s fourth visit to the Mt Morgans goldfield under Dacian (having also visited when Dominion owned it), with our first Dacian report at 40.5c in July 2015 available on http://www.eagleres.com.au/images/pdfs/reports/2015/dcn30jul15.pdf, and page 3 of http://www.eagleres.com.au/images/pdfs/reports/2017/dcn01aug17.pdf showing the colour identification of Westralia’s BIFs].

Other Key Points: :

• Dacian remains on target to achieve Commercial Production by the end of December 2018 (5ktpd open-cut, 3ktpd underground), with Beresford North and Beresford South both stoping, and Allanson expected to be in ore development. Allanson then starts stoping early in 2019.
• Gold production is expected to be skewed to the June Qtr 2019, as stoping increasingly replaces development (development grades are often ~60% to 70% of stoping grades - due to dilution), and the open-cut is then expected to be in a higher grade area of the Cornwall Shear Zone.
• The plant was ticking over at 2.7Mtpa and ~95% recoveries in SQ 2018. With 2.5Mtpa designed on the 80th percentile, ERA’s view remains that ~3.1Mtpa may be achievable, possibly higher.
• The Westralian underground is regarded as a miner’s dream, ticking all the boxes : gold grades close to 5g/t (there are higher spots, initial ore reserves are ~4.6g/t), dry (as in no running water), simple (tram-track) geology, freestanding (without scaling) stopes to 55m high, and hard ground (development is literally “flying” at ~120m vertical per year vs the industry norm of 75m).
• Exploration has been achieving early success in filling in the gaps between the Beresford and Allanson underground, and Heffernans and Doublejay open-cuts, potentially inferring longer life, aside from the probable depth extensions to Westralia based on reported drillhole results.
• Cameron Well has been delineated as different to the Jupiter complex, being two main gold mineralised structures under a broad supergene blanket. The two structures are expected to be targeted now that they have been delineated. There is another “syenite” target area at Cedar Island.
• Dacian expect to review/explore some of its “other” target areas by JH 2020, such as the numerous old workings, including those near Maxwells, Golden Cliffs and possibly Rainbow Bore.