On 5 February 2019, AuStar Gold Limited (ASX: AUL), a gold exploration company from the metals and mining sector, announced that it is soon going to start production from its famous Rose of Denmark and Morning Stargold mines in Victoria eastern goldfields. It is an important milestone in the history of the AUL and is the outcome of the effective exploration program and the initiatives taken during 2018 regarding the development, mining and processing at the Victoria eastern goldfields.Â
As per the ASX release on 11 December 2018, the company had targets to continue the mining till March 2019 quarter. However, the company has gained sufficient confidence based on its minerals inventory estimation and mine planning which pushed them to commence the production. The decision to start production is consistent with the strategy outlined by the Board of identifying economic ore bodies, and the company is going to use its production-ready infrastructure to generate value.
The company is soon going to commence the mining program at both its mines. The processing of the ore will be at the Morning Star gravity processing plant. The abundant material for plant feed will come from McNallyâs Reef and the nearby Rose of Denmark mine (RoD) and after the development of the mines, the company will access Stoneâs Reef.
Mining at the Rose of Denmark gold mine will access material recently identified using percussion drilling and diamond drilling undertaken in the adit. The recent drilling at the McNallyâs Reef produced high-grade results.
Drilling of 1.10 meters led to the discovery of 171.84 g/t of gold which includes 0.20 meters of drilling which resulted in 937.5 g/t of gold.
Drilling of 1.05 meters led to the discovery of 169.31 g/t of gold which includes 0.40 meters of drilling which resulted in 169.31 g/t of gold and 0.65 meters of drilling which resulted in 209.93 g/t.
A drilling of 9.75 meters led to the discovery of 66.82g/t of gold which include 0.20 meters of drilling which resulted in 876.12g/t of gold, 0.55 meters of drilling which resulted in 734.31g/t of gold, 0.75 meters ofÂ drillingÂ which resulted in 33.74g/t of gold and 0.70 meters of drillingÂ which resulted in 29.42g/t of gold.
Drilling of 0.78 meters led to the discovery of 150.68g/t of gold.
Drilling of 0.65 metres led to the discovery of 17.02 g/t of gold which includes 0.30 of meters drilling which resulted in 29.36 g/t of gold.
Drilling of 0.50 meters led to the discovery of 9.10 g/t of gold.
Drilling of 1.50 meters led to the discovery of 8.70 g/t of gold
Drilling of 1.80m led to the discovery of 46.09 g/t of gold which includes 0.60 meters of drilling which resulted in 34.41 g/t of gold and 0.60 meters of drilling which resulted in 102.39 g/t of gold
Drilling of 0.75 meters led to the discovery of 10.92 g/t of gold.
There will be an ongoing exploration activity at the RoD and Morning Star Gold mines. The mining inventory will replace the material processed through the plant.
The stock has generated a negative return of 20% over the last six months. The current market price of the stock is A$0.005 (with the close of market on 5 February 2019) with the market capitalization of A$13.56 million and approximately 3.39 billion outstanding shares.
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