Tag Archives: Geopacific Resources

Delay in Woodlark mine causing anxiety: MP

Cedric Patjole | Loop PNG | February 9, 2018

The delay in the Woodlark Island Gold Project is causing a lot of anxiety and undesired expectation from landowners.

Samarai-Murua MP, Isi Leonard, said this in Parliament when asking Mining Minister Johnson Tuke on the status of the Woodlark Island Gold Project.

Leonard said the project has been on development status for well over a decade following numerous delays and a changing of ownership twice.

“The people of Woodlark and Samarai-Murua regard the project as a major catalyst for development. But the delay in its development is causing much anxiety and undesired expectation,” he said.

The member asked Minister Tuke the status of the project, whether the low commodity process hindered project development financing and if the government could step in.

Leonard asked about a previous agreement for a joint venture partnership to develop gold projects on Woodlark and Misima islands.

He also said if the current explorer is moving ahead, can a previous project agreement signed be approved by the Government.

“Geo-pacific Resources is moving the project forward, can the MOA agreed to by stakeholders in December 2015 be approved by the NEC. This will give more confidence to the landowners and the developers of the project,” he said.

Meanwhile, Minister Tuke asked the MP to send his office his series of questions which he will respond in detail as he did not have the information with him.

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Foreign investors mock PNG govt’s dumb deal

‘The project came gift wrapped, courtesy of the PNG Government who will buy 5% when it is ready to be mined by paying the equivalent of 5% of sunk costs to-date. This could see the PNG Government shell out more than $6m for just 5% of the project’.

Geopacific muscling into giant territory with PNG gold majors

Matt Birney | Business News | 9 November, 2017

They say that it’s often the second owner of the big projects that make money from them and that may well be true of Geopacific Resources’ Woodlark Island project in PNG.

It was picked up for a song by Geopacific from Kula Gold and is positioned dead centre in the middle of a string of copper and gold infested islands that make up mineral rich Papua New Guinea.

In a region littered with mining projects that boast gold resources of up to 60m ounces, it is almost unthinkable that Geopacific’s mineral reserve would remain at just 766,000 ounces of gold – a number that would already have most junior explorers starting a conversation with an EPC contractor.

A quick glance at the existing PNG projects that form a neat radius around Geopacific’s Woodlark Island project leaves you with the distinct impression that this is indeed the land of the giants.

Neatly positioned around Woodlark is Newcrest’s 49m ounce Lihir project, St Barbara’s 6m ounce Simberi project, Rio Tinto’s former 23m ounce Panguna mine, the 29m ounce Hidden Valley project, the dual 17m ounce Ok Tedi and Frieda River deposits and the 24m ounce Porgera project.

The goliath amongst the giants however is clearly the 63m ounce Freeport Papua project that boasts one of the largest gold and copper resources in the world.

At 2m ounces of resource and 766,000 ounces of reserve going 2.2 grams per tonne, Geopacific’s deposit, as impressive as it is, drifts into obscurity amongst these giants.

The company is however continuing to furiously drill it out and with such huge projects in their midst, management’s expectation of a sizeable upgrade in reserve is perhaps not unreasonable.

Kula Gold listed on the back of the Woodlark project with a remarkable $1.80 float in November 2010 that resulted in a $203m market cap for the company.

They had $80m in the bank on listing day and spent the lot on the project and then some.

In fact by the time Kula ran out of financial puff last year they had plunged almost $150m into the project and associated corporate entities.

Amazingly, Geopacific picked up 87% of it earlier this year through a series of corporate and project level plays for the paltry sum of just $10m worth of script and $650k worth of expenditure on the ground.

And the project came gift wrapped too, courtesy of the PNG Government who will buy 5% of it when it is ready to be mined by paying the equivalent of 5% of sunk costs to-date. This could see the PNG Government shell out more than $6m for just 5% of the project.

In addition to now holding 86% of Kula who own 95% of Woodlark, Geopacific already own 5% of the actual Woodlark project after spending $650k on it as part of their farm in agreement. Geopacific started their quest for control of Woodlark initially by entering into a farm in agreement with Kula, but later decided to take over the entire company in a 1 for 1.1 all script offer and to-date have secured 86% of Kula’s stock in a move that cost them only about $10m in script.

They also have further farm in rights and creep abilities that will most likely see them own almost all of it save only for the PNG Government’s 5% share in due course.

Woodlark could very well be a miners paradise too, with a reserve that may well keep growing and a project that is already fully permitted from both an environmental and mining perspective.

The project came with a veritable storehouse of drilling data from over 275,000 metres of drilling and Geopacific have added over 20,000 additional metres since getting involved.

Even though the global resource grade at Woodlark is 2.2 grams per tonne, the three different prospects within the project boast some impressive high grade breakouts.

These include a 32m intersection grading 7 grams per tonne gold, 48m @ 10.39 g/t, 36m @ 12.52 g/t, 11.2m @ 36.3 g/t and 22m @ 7.54 g/t gold, all of which are from the Kulumadau prospect which is still open to the west and East.

Geopacific discovered an 84m mineralised zone at Kulumadau with several well mineralised intercepts including 10m @ 7.84 g/t, 13m @ 3.11 g/t and 12.3m @ 2.23 grams per tonne gold.

Other impressively long intersections at the project include 21m @3.27g from 40m, 23m @ 4.82 g/t from 102m, 52 @4.5g/t, 19m @ 3g/t, 27m @ 2.5g/t, 34m @ 3g/t and 33m @ 4 grams per tonne gold.

Kula completed a feasibility study on the project some years ago which will most likely require updating now but will serve as a cost effective base for Geopacific’s own study of the resource.

Kula concluded that the project could turn out 674,000 ounces of gold over the first 6 years of mine life from a 1.8mt per annum plant.

They predicted that figure could increase to 813,000 ounces over the first nine years when in-pit inferred resources and lower grade stockpiles were utilised.

Cash operating costs were predicted to come in at around US$730 an ounce with capital costt looking like being somewhere in the order of U$160m.

Kula’s study also identified several out of pit areas that could potentially increase the ore reserve in time, particularly at the Kulumadau prospect where a further 4mt at 2.9 grams per tonne for around 400,000 inferred ounces were identi fied but not included in the pit design at the time.

Kula were looking to upgrade these resources with further drilling and the grand plan was to eventually amalgamate the Kulumadau east and west pits.

Geopacific recently raised $10.5m in an oversubscribed capital raise to continue the considerable work already carried out on Woodlark by Kula and they are now armed and dangerous as they hurtle headlong towards a decision to get into production.

The market is expecting an upgrade to the mineral reserve at Woodlark sometime soon as Geopaci c completes its own study on the project and continues its extensive drilling campaign.

Geopacific management appear have form too. The management team, led by Geologist Ron Heeks point to the 10 mines in six different countries they have developed between them as evidence that they can make Woodlark fly. Notably Heeks was the technical manager at Straights Asia and was partly responsible for turn around at the Muro gold mine and also at the Sebuku coal mine amongst other things.

The institutions are also sitting up and taking notice of Woodlark too with the likes of Tembo Capital, RCF, Pacific Road, Franklin Advisers and RMB Australia sitting comfortably on the Geopacific register now.

Woodlark is a fast developing story that looks to still have some upside with the potential to really surprise given the monolithic projects on its doorstep.

PNG is a region that does not consider a 2 million ounce resource or even a 2 million ounce reserve to be remarkable – at just 2.7c a share and with a market cap of around $50m, Geopacific and Woodlark look interesting amongst a sea of amazing projects.

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Geopacific to advance Woodlark gold project following Kula takeover

Australian Mining | September 1, 2017

Geopacific Resources has raised $10.5 million through a share placement to help it advance development of the Woodlark gold project in Papua New Guinea.

The capital raising follows Geopacific’s takeover of Kula Gold, the owner of the project on Woodlark Island.

Geopacific’s stake in Kula has increased to 75.05 per cent over the past month and it has appointed directors to the takeover target’s board.

Managing director Ron Heeks said Geopacific achieved an oversubscribed capital raising, offered without a discount to the closing price on the day prior to the placement.

“We are now in a position to deliver our strategy, to continue to unlock the value and also test the true scale of the Woodlark gold project through exploration,” Heeks said.

Geopacific is also planning to offer a share purchase plan to raise an additional $1 million at 3 cents per share.

Heeks said Geopacific was planning to advance the Woodlark project towards production in the most effective manner.

“The exploration potential of the region is historically and recently known to be significant and drilling results and metallurgical testwork have been consistently positive. We are looking forward to moving to the project forward,” Heeks said.

Woodlark’s development approvals include a 1.8 million tonne per annum conventional carbon-in-leach processing plant.

The company has launched a 16-week metallurgical testwork program at the site and will use the results in a definitive feasibility study for the project.

Geopacific raises A$10.5m for Woodlark

Esmarie Swanepoel | Mining Weekly | 1 September 2017

ASX-listed Geopacific Resources has raised A$10.5-million through a share placement to advance its Woodlark gold project, in Papua New Guinea, towards production.

The company on Friday announced that it would place 250-million shares, at 3c each, to a wide range of high-calibre investors, the majority of which were already shareholders.

The shares would be placed under the company’s existing capacity, and would not require shareholder approval.

“We are delighted with the level of support we have seen in this placement. We have achieved an oversubscribed capital raise, offered without a discount to the closing price on the day prior to the placement,” said Geopacific MD Ron Heeks.

“The strength of support from specialist resource sector investors and generalist Australian institutional investors demonstrates that Geopacific presents a value proposition,” he added.

The company is now planning a share purchase plan to raise an additional A$1-million, with shares to be priced at 3c each.

Geopacific is currently advancing work at its Woodlark project, where a previous definitive feasibility study estimated that a 1.8-million-tonne-a-year gravity and carbon-in-leach operation could produce around 100 000 oz/y of gold.

Geopacific had initially entered into an earn-in agreement with fellow-listed Kula Gold to acquire an 80% share in the project area, but in April this year launched a full takeover offer for Kula. 

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Woodlark mine optimisation positive

Cedric Patjole | LOOP PNG | 2 June 2017

A cohesive approach to optimisation of the Woodlark Gold Mine in Milne Bay Province is producing positive results [says the mining company!]

Mine operators Geopacific Resources Limited announced in a statement that many technical aspects of the mine have been investigated in detail and consequently, work is centered on assessing optimisation opportunities.

They include modular construction techniques; refining the processing plant flow sheet and technology.

Geopacific says considerable effort is being applied to optimising mining with areas of interest, including optimal mine design, refining grade-scheduling to shorten the capital paycheck period and equipment selection.

The company adds that capital savings directly affect the financing period of the mine, while operational cost directly affect the size of the gold reserve and optimising both provides for a robust project.

“Woodlark is a solid project – a multi-million-ounce gold deposit with approvals in place to build a 1.8 Mtpa (million ton per annum) plant and opportune timing in the mining cycle,” reads the statement.

“Woodlark is beneficially differentiated by being on an island. Cost-effective modular build options and operational logistics come into play because we are located on the coast with access in protected bay with deep water.

“Our focus is to optimise Woodlark and take it into production. We are taking a comprehensive approach to our review and optimisation work program, with positive results and encouraging levels of progress – evident in this update.”

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Highlands claim piece of Woodlark pie

Esmarie Swanepoel | Mining Weekly | 10 March, 2017

ASX-listed Highlands Pacific has laid claim to a portion of the Woodlark gold project, in Papua New Guinea, telling shareholders that it has identified a royalty entitlement after reviewing agreements relating to previously held exploration ground.

Highlands Pacific told shareholders on Friday that the royalty amount was for A$10/oz of gold for the first 200 000 oz produced at the area.

Highland’s precedent companies held an interest in one of the exploration tenements making up the Woodlark projectin 1995, prior to the sale of the exploration tenement and the creation of the royalty entitlement.

Highlands has now reminded owner Kula Gold of the entitlement to the royalty.

Kula’s joint venture partner Geopacific Resources, which is earning an 80% share in the Woodlark project, recently identified a A$25-million capital saving at the proposed Woodlark plant.

Geopacific is also now looking at opportunities to achieve further savings in infrastructure costs. 

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Woodlark Island gold exploration update

woodlark-kula-gold-geopacific

Geopacific moves to next stage in PNG

GEOPACIFIC Resources said due diligence had given it the confidence to proceed to the $A8 million second stage of an earn-in agreement with Kula Gold over the Woodlark Island gold project in Papua New Guinea.

Kristie Batten | Mining News | 6 October, 2016

After announcing the $18.65 million agreement in July, Geopacific had up to six months to spend as much as $650,000 on due diligence to earn an initial 5%.

The company completed the initial phase and will now move to a more intensive stage, whereby it is required to spend up to $8 million over two years to achieve a 1.2 million ounce reserve.

That would give the project a 10-year mine life at 120,000oz per annum.

Completing stage two would give Geopacific 51%, though if it spends the money and does not achieve the 1.2Moz reserve, it will hold 40%.

Geopacific can move to 60-75% by spending up to $10 million and achieving “bankable” status at the project.

Woodlark has a current resource of 45.1 million tonnes at 1.5 grams per tonne gold for 2.12Moz gold.

The 2012 feasibility study envisaged a nine-year life at capital costs of more than $200 million for a payback period of four years, but more work will be required to improve economics.

Geopacific is planning to conduct limited infill drilling with the aim of converting a portion of the 800,000oz inferred resource into the measured and indicated categories.

That work will assist in converting resources to reserves and improving the project economics.

Geopacific managing director Ron Heeks said the massive upside potential of the project became more evident during a recent site visit.

“Everything about the trip was positive and we’ve had nothing but support from government and community members that we’ve dealt with in PNG and on Woodlark,” he said.

“We look forward to commencing development drilling and delivering Woodlark along the development path into production.”

Geopacific is well-funded after recently raising $15 million.

Shares in the company were untraded at 3.6c, while Kula was unchanged at 2.9c.

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Geopacific raises $15m for PNG project

woodlark

Marian Webb | Mining Weekly | August 18, 2016

ASX-listed project developer Geopacific Resources has raised $15-million, which it will use to advance its Woodlark gold project, in Papua New Guinea, towards gold production.

Announcing the completion of the “well oversubscribed” placement on Thursday, the company reported that a number of new, high-calibre investors had joined its share register.

“We believe that we have the right strategy to transition from exploration to mining and return value to our shareholders. The support we have received in this capital raising confirms that the market agrees,” MD Ron Heeks said in a statement.

Geopacific believes that Woodlark, in which it is earning an 80% interest, holds potential to be a minimum five-million-ounce goldfield. Currently, the resource is 45.1-million tonnes at 1.50 g/t for 2.12-million ounces. 

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