- Middle Island Resources Limited (ASX:MDI) has recently reported its quarterly results for the period ended March 2021.
- The Company continued to progress with the development of its Sandstone gold project and Barkly super project during the quarter.
- MDI closed the quarter with aggregated cash and investments of AUD 4.07 million.
Middle Island Resources Limited (ASX:MDI) has recently released its quarterly findings for the three-month period ended 31 March 2021 on the ASX. During the quarter, the Company continued to focus on the re-commissioning of its wholly-owned Sandstone gold processing plant besides progressing discussions on consolidation of proximal third-party deposits.
The gold explorer closed the quarter with aggregated cash and investments of AUD 4.07 million, comprising AUD 0.71 million in cash and AUD 3.36 million in Tajiri Resources Corporation (TSXV:TAJ) and Alto Metals Limited’s (ASX:AME) ordinary shares.
During the quarter, Middle Island progressed with the 2020-21 drilling campaign at the Sandstone project, advanced the Sandstone feasibility study (FS) and announced a demerger of Barkly copper-gold assets to focus on optimising shareholder value for its flagship asset. Continuing to operate in line with its strategy, the Company announced the results from the FS and a mill upgrade study post the reporting period.
Sandstone Gold Project
Middle Island completed some 5,260m of the Phase 3 RC drilling campaign at the Sandstone project during the quarter, successfully sterilising areas for new and expanded waste dumps, and a tailings facility expansion, together with additional resource extension & exploration drilling.
As part of the Phase 3 RC drilling campaign, the Company completed infill and extension resource definition drilling at Eureka, McIntyre, Ridge, Shillington, and Goat Farm deposits.
Interestingly, the previously completed Phase 1 and 2, 2020 drilling campaigns, have also proved to be extremely successful. These campaigns allowed the Company to define five new satellite gold deposits and double the open-pit Mineral Resources to 768,100oz gold at Sandstone.
Additionally, Middle Island received final mining costs, a number of other costs, and technical inputs during the quarter, which were evaluated and included in the FS. The Company continued with the advancement of the FS into re-commissioning the Sandstone project on a stand-alone 500 ktpa basis.
Barkly Super Project
In January 2021, the Company secured additional permits at the Barkly Super Project and witnessed the release of the highly prospective Minex CRC stratigraphic drill holes. The new applications took the aggregate Barkly project tenure to 12 permits, comprising 4,411 sq. Km.
Subsequently, in March 2021, Middle Island also announced the spin-out of Barkly Operations Pty Ltd (BOPL), following strong corporate interest and the recent Crosswinds copper discovery at the Barkly copper-gold project. The Company intends to potentially unlock significant value for its eligible shareholders through the demerger.
As per the Company’s Managing Director, Mr Rick Yeates - “The significant project potential and the demerger of BOPL will provide another opportunity to investors to boost the value as MDI begins greenfields exploration of an intriguing new copper-gold province”.
Events Subsequent to the Quarter
Following the end of the March quarter, Middle Island unveiled the results from the mill upgrade study and the stand-alone Feasibility Study for its Sandstone project.
The feasibility study revealed a marginal but cash flow-positive economic outcome at AUD 2,500/oz. The study showed that the Sandstone project currently has an undiscounted post-tax cash flow of about AUD 4 million, based on a gold price of AUD 2,500/oz.
On the other hand, the mill upgrade study indicated that a processing plant upgrade to 750ktpa is a very encouraging option, which could substantially reduce operating costs. The study found that the upgrade if completed simultaneously with refurbishment would cost the Company approximately just about AUD 18.3 million.
MDI shares are trading at AUD 0.130 as of 2:29 PM AEST.