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PANORAMIC
BROADENS ITS HORIZONS
PETER HAROLD
MANAGING DIRECTOR
PANORAMIC RESOURCES LTD
WORKING AT SAVANNAH NICKEL MINE
eading Australian nickel miner, Panoramic
Resources, has embarked upon a major
diversification designed to position it
in the top echelon of the nation’s gold
operations in less than three years.
In February 2011, Panoramic finalised the acquisition
from Apex Resources of the Gidgee gold project, located
near Wiluna, Western Australia, in a $15.5 million cash
transaction. Panoramic plans to have the project back
into production within two to three years, and is targeting
output of up to 100,000 ounces of gold a year, which would
rank the project in, or very close to, Australia’s top twenty
gold operations.
Panoramic’s Managing Director, Peter Harold, said
the acquisition was the first major step towards the
company’s long-term vision of becoming a major,
diversified mining house.
“Entering the gold business spreads the risk pretty
well, and as things stand at present we could not have
chosen a better time,” he said.
Mr Harold said the Panoramic team was well endowed
with the talent and experience to get the best out
of Gidgee, a field that has produced over 1 million
ounces historically.
“We have a sound track record for getting new ventures
off the ground, such as our Savannah nickel mine, which
we took from the resource definition phase through
feasibility studies to construction and production.
“Perhaps more relevant to Gidgee is our experience at
Lanfranchi, which we acquired in 2004. There, we have
been able to substantially increase production and long-
term prospects by combining state-of-the-art exploration
with innovative mining techniques that have made
Lanfranchi one of the biggest paste fill mining operations
in Australia.
“In effect, what we’ve achieved at Lanfranchi has been
to turn someone else’s unloved duckling into a project that
is producing golden eggs for our shareholders,” he said.
Output from Savannah and Lanfranchi in the 2010/11
financial year was 17,027 tonnes of contained nickel,
which represents approximately 10% of Australia’s total
nickel output. Careful cost management and a prudent
hedging program have enabled the company to build a
seven-year profit record and punch well above its weight
in terms of returns to shareholders since 2005.
The end of FY2011 saw Panoramic in the enviable
position of having $125 million in cash and receivables,
and no bank debt.
It was the ability to offer cash that enabled Panoramic to
secure the Gidgee project for what some observers believe
could turn out to be a real bargain, and this also puts the
company in a strong position to fast track bringing the
project back into production.
The project area covers over 1,200 square kilometres
of the Gum Creek greenstone belt in the Murchison
region of Western Australia, and comes with extensive
infrastructure including a 150 person camp, an airstrip
and a 600,000 tonnes per annum (tpa) processing plant,
currently on care and maintenance.
Peter Harold describes Gidgee as “an Aladdin’s Cave of
opportunity”, pointing out that it contains over 20 existing
open pits and two underground mines, in an area that
boasts an impressive pedigree. Gidgee has yielded over
one million ounces of gold since 1923, with a significant
part of that production coming from operations between
1987 and 2005.
“Production at Gidgee was halted in 2005, when
the gold price was south of US$500 per ounce. There
had been very little drilling below 150 metres, and no
serious exploration in 10 years, despite historical bonanza
grades including 20 metres at 40.5 grams per tonne (g/t)
from 36 metres and another 20 metres at 18.3 g/t from
71 metres below the same open pit, and 15 metres at
8.6 g/t from 101 metres below another pit.
“We have already identified 210 drill targets, the
majority of which are located outside the current resources.
“We’ve commenced an aggressive exploration program,
including extensions to existing resources. A 23,000 metre
air core drilling program was recently completed and the
next cab off the rank is a 15,000 metre reverse circulation
and diamond drilling program scheduled to begin in the
last quarter of 2011,” Mr Harold said.
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MINESITE 2011
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