The Cloncurry Gold Project earn-in is set to be the subject of a flurry of activity for AuKing Mining Ltd (ASX:AKN) after the company received a briefing from operator Orion Resources Ltd about its 2025 plans.
Earn-in opportunity
Orion has proposed a deal that presents AuKing with the opportunity to earn-in a 15% interest in the Cloncurry Project after incurring $1.5 million in project expenditure before December 31, 2025.
This would allow AuKing to secure an interest in a near-term gold-producing asset in northwest Queensland.
“Clearly, the exploration work to be conducted by AuKing’s exploration team as part of the earn-in arrangements (at Mt Freda, Golden Mile and probably the nearby Mt Scheelite prospect) is going to provide essential information for Orion Resources to realise its aims to re-establish mining and processing operations in and around the Lorena facility,” AuKing managing director Paul Williams said.
Focus on updating resources
Orion has engaged consultants to complete a conceptual mining study and mineral resource review of the Mt Freda and Golden Mile project areas, which are the areas subject to the AuKing earn-in agreement.
The initial focus includes updating JORC resources at Mt Freda and conducting drilling at Mt Freda and Golden Mile to improve resource confidence.
This work will support proposed mining and economic studies that could facilitate a restart of operations.
A key component of the strategy is the Lorena Processing Facility Recommissioning Study.
Lorena gold-copper processing plant
Orion has entered into an asset sale agreement (ASA) to acquire the existing Lorena processing plant and associated facilities, only 15 kilometres east of Cloncurry in northern Queensland, together with various exploration and mining tenements in that area.
There are plans to prepare a fully costed project plan to recommission the Lorena gold-copper processing plant, which has a capacity of 250,000 to 300,000 tonnes per annum, along with its associated tailings storage facility.
The study will address capital expenditure for refurbishment, operating costs, tailings storage expansion and regulatory approvals.
Further drilling is also proposed at the nearby Mt Scheelite project. Historical results reported by Tombola Gold Limited in 2022 include highlights such as 15 metres at 6.96 g/t gold from 28 metres, including 5 metres at 11.20 g/t gold.
Mt Scheelite is just 600 metres west of the Golden Mile pits, which bolsters the potential for resource continuity and further exploration upside.
The conceptual mining study and mineral resource review, expected by early 2025, will guide exploration drilling and development decisions.
The companies’ re-start strategy is designed to expedite the project through typical study phases, leveraging existing infrastructure and prior operational data.