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Development of Gruyere mine kick started by Gold Road and Gold Fields - International Mining

Friday, 16 June 2017

Gold Road Resources Ltd has confirmed the EPC contract has now been signed with the Amec Foster Wheeler Civmec Joint Venture (ACJV) for the Gruyere gold project, allowing work on the design, procurement and installation of the process plant and associated infrastructure to commence.

Gold Road Managing Director and CEO Ian Murray welcomed the execution of the EPC contract with ACJV. “This is another key milestone in the delivery of Gruyere into production and we look forward to work on the plant and associated infrastructure commencing in earnest on site.

“Importantly, this contract will focus on maximising the local content in the construction of Gruyere and generating significant employment opportunities in the Goldfields region and Western Australia more broadly.”

The execution of the contract follows on from the naming of ACJV as the preferred contractor for the EPC work on in April 2017.

 

The project is a 50:50 Joint Venture with Gold Fields Ltd (Gruyere JV), managed by Gruyere Management Pty Ltd (GRM) – a wholly owned subsidiary of Gold Fields.

The EPC contract executed by the Gruyere JV is a “lump sum, fixed price” contract valued at A$298 million. The schedule agreed with ACJV is protected through a standard liquidated damages provision.

ACJV has committed to maximising procurement through local Australian sources for the supply of steel and equipment for the project. The steel and platework fabrication for the process plant will be carried out at Civmec’s 200,000 m2 fabrication facility in Henderson, Western Australia ‐ the largest heavy engineering facility of its kind in Australia.

Fabrication of the process plant and other project infrastructure at the Henderson facility will provide direct work for an estimated 30 to 50 people. ACJV expects to have a total workforce of approximately 300 people on site at peak construction and will begin mobilising to Gruyere in August 2017.

ACJV has developed a comprehensive community engagement plan and are committed to working closely with local communities.

The Gruyere gold project was discovered by Gold Road in October 2013 on the South Dorothy Hills Trend, 25 km northeast of the company’s original Yamarna Belt discovery, Central Bore. Within 10 months of Gruyere’s discovery, Gold Road had defined a significant high-grade gold deposit and announced a maiden JORC 2012 Mineral Resource of 96.93 Mt grading 1.23 g/t Au.

The Gruyere Mineral Resource has since grown to 148 Mt grading 1.3 g/t Au, making it one of the largest undeveloped known gold deposits in Australia.

After completing positive PFS and feasibility studies on Gruyere, Gold Road announced in November 2016 it would sell 50% of the project to leading international gold producer Gold Fields for A$350 million in cash plus a 1.5% Net Smelter Return royalty on production over 2 Moz.

The feasibility study delivered by Gold Road in October 2016 envisaged a large-scale open pit mine feeding a 7.5 Mt/y processing plant and producing an average of 270,000 oz/y of gold over an initial 13 year mine life.


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