The company is also focusing on refurbishing the existing TGME CIL plant (downhill from Theta Hill project) with the intention of resuming production.
Two private placements worth $6 million were completed last year to fully fund the feasibility study for Theta Hill which has its origins in the company’s larger TGME Gold Project.
As an ASX junior explorer, Theta Gold has one of the largest JORC 2012 resources with 5.75 million ounces of gold at the TGME Gold Project.
A map of Theta Gold Mines’s historic goldfield that hosts the TGME and Theta Hill gold projects in South Africa
Theta Gold Mines’ TGME project is near the heritage town of Pilgrim’s Rest and forestry town of Sabie in Mpumalanga Province, 370 kilometres northeast of Johannesburg.
A scoping study for Theta Hill released in mid-October 2018 delivered a positive result for the shallow, high-grade resource which features 4.5 million tonnes grading 4.14 g/t gold for 600,000 ounces.
Theta Hill scoping study
The scoping study models a 7.6-year, 67,000-ounce-a-year mine operation where 92% of ore is recovered.
Theta Hill mine would take about 10 months to build and 7.4 months to pay back initial capital costs.
Peak capital requirement would be US$16 million, valuing the project at US$152 million, using an after-tax net present value (NPV) calculated with a real 7.5% discount.
The internal rate of return is 132%, with life-of-mine all-in sustaining costs of US$569 an ounce.
The company recently received further high-grade gold results from resource infill drilling aimed at boosting the 5.8 million-ounce resource at the TGME project.
Drilling at the Theta Hill, Columbia Hill and Scammells deposits has returned high-grade assays.
Best results are 11 metres at 2.1 g/t from 8 metres, including 1-metre at 9.5 g/t; and 1-metre at 27.5 g/t from 8 metres; and 2 metres at 5.9 g/t from 24 metres.
The old TGME plant downhill from Theta Hill project
The long-term pipeline strategy
The company’s Theta Hill scoping study has affirmed the belief that historical mines on the 620 square kilometre goldfield could have open-cut oxide gold fundamentals.
Some have called the goldfield South Africa’s new gold province.
Theta Gold chairman Bill Guy noted in days gone past it was a prolific, producing field that returned high grades.
Guy said: “This field itself has produced more than 6 million ounces already, historically, and really all we’re doing is looking for the open-cut potential as part of that process.
“The team came up with the concept well why isn’t it at the surface, why can’t you open-cut this instead of going underground?”
The engineering team’s efforts were successful, finding the field project could also be open-cut.
Forty-three highlighted operations, including four Pan African Resources plc sites
Theta Gold also has dozens more projects it could apply a similar approach to, acknowledges the company’s chairman.
Guy said: “Theta really is a proof-of-concept for us, so now we can take that model, the exploration, and the evaluation approach to the other 43 historical mines on our ground.”
Theta Gold is calling the project its long-term pipeline strategy.
Planned layout of upgraded facilities
Theta Gold Mines managing director Rob Thomson acknowledged the company could take its open-cut approach to other projects to define new oxide open-cut resources, saying: “We’ve identified a lot of other open-cut potential.
“But it’s got to be systemic, methodical, get-going, nice operations close to TGME (carbon-in-leach) plant.”
Theta Gold Mines plans to truck ore 1.5 kilometres down the hill to the TGME plant to produce gold, then expand by opening up additional open-cut operations.
Multiple open‐cut drilling targets
The company acknowledges there are more reserves underground but it plans to look at this opportunity down the track.
For now, it’s focused on finishing the Theta Hill feasibility study within the current quarter.