The new owners of a Central Queensland gold mine plan to “aggressively explore” tenements it has purchased around the site to develop the operation.
- Cracow Gold Mine produces more than 80,000 ounces yearly
- Copper producer Aeris Resources has purchased the site from Evolution Mining
Aeris plans to explore 900 square kilometres of “highly prospective” tenements around it
Copper explorer Aeris Resources has entered into a share purchase agreement with Evolution Mining, effectively buying the Cracow Gold Mine and approximately 900 square kilometres of surrounding exploration and mining lease areas.
The mine is located about 250km south-west of Rockhampton.
In the 2018–19 financial year, the underground mine produced more than 80,000 ounces of gold, with a full-year net mine cashflow of $36.1 million.
Aeris executive chairman Andre Labuschagne said the company hoped to “get the keys” to the mine in early July, and had committed $13 million to exploring nearby tenements.
“Only a small portion of the 900 square kilometres is being mined,” he said.
‘Aeris intends to aggressively explore’
In a statement to shareholders, Aeris Resources said it would be exploring both brownfield and greenfield sites, meaning both new and partially-developed sites would be explored to extend the life of the mine.
“Acquisition includes a highly prospective tenement package covering 903 km2, which Aeris intends to aggressively explore,” the ASX announcement said.
“Cracow has a strong track record of reserve and resource replacement and Aeris plans to aggressively invest in brownfield and greenfield exploration with the aim of growing the resource base to extend mine life.”
To be granted an exploration permit by the Department of Natural Resources, Mines and Energy, companies must comply with the Land Access Code in negotiation with private landholders in the area.
For further large-scale mining to commence in the company’s exploration areas not covered by existing mining leases, it would have to submit further environmental authority documentation.
Aeris Resources agreed to pay Evolution $60 million in cash upon closing of the transaction plus a deferred payment of $15 million on June 30, 2022, plus a 10 per cent net value royalty.
Cracow Mine workforce bigger than the town itself
Mr Labuschagne said the mine’s 220 full-time employees would be welcome to stay on.
He said most are fly-in, fly-out workers from south-east Queensland, with some driving in and out from nearby regional towns.
The workforce at the mine is bigger than its closest town, with most workers staying in a separate mining camp.
With a population of just 89 people, Cracow’s Mayor Neville Ferrier said gold mining had kept the town alive.
Mr Ferrier said it experienced a gold boom in the 1800s and saw its first mine developed in the 1930s, but said the town suffered after 1976 when the Golden Plateau mine ceased production.
The Cracow mine was developed in 2003 by a group of companies, with Evolution Mining taking over 100 per cent ownership in 2011.
Mr Ferrier said the mine had previously struggled to attract a local workforce.
Last year, Evolution Mining fixed Theodore’s airstrip at a cost of around $3 million.
“Between Cracow and Theodore, Evolution has been very good to those little towns,” Mr Ferrier said.
“They seem to keep finding enough [gold] to keep going.
“We hope it keeps going forever.”