*Tier 1: greater than 10 year mine life; greater than 300,000 ounces per annum; greater than 3.5 million ounce Ore Reserve and costs at the lower end of the cost curve.
The Gruyere Gold Mine was discovered by Gold Road in October 2013 on the South Dorothy Hills Trend, 25 kilometres north-east 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 million tonnes grading 1.23 grams of gold per tonne for 3.8 million ounces of contained gold.
The Gruyere Mineral Resource has since grown to 140 million tonnes grading 1.3 grams per tonne for 5.8 million ounces of contained gold, making it one of the largest virgin gold discoveries in Australia.
After completing positive Feasibility Studies on Gruyere, Gold Road announced in November 2016 it would sell 50% of the Project to leading international gold producer Gold Fields Ltd for A$350 million in cash plus a 1.5% Net Smelter Return royalty on production over 2 million ounces.
The transaction fully funds Gold Road for its 50% share of development capital and de-risks the Project to a significant degree through the introduction of a partner highly experienced in the development and operation of open-pit gold mines that has agreed to cover any cost overrun up to 10% of the total initial development budget (A$50.7 million).
Under the Joint Venture Agreement, Gold Fields will manage the development of Gruyere and will also manage the operation of the mine. Gold Road retains responsibility for exploration on the Joint Venture tenements.
Construction of the Project commenced at the beginning of 2017 and since then the project team has achieved a number of significant milestones with first gold delivered in the June 2019 quarter.
Gruyere is expected to produce between 75,000 and 100,000 ounces of gold in calendar year 2019. Once steady state production is achieved the average annual production is forecast at 300,000 ounces.
Project milestones achieved since commencement of construction included: