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Red 5 to produce up to 95,000 gold ounces in FY'18 after maiden Darlot resource

Western Australia-focused Red 5 Ltd. expects total production of 85,000 to 95,000 ounces in 2018 from the Darlot gold mine and the King of the Hills gold project.

The company provided the forecast after estimating a maiden JORC 2012-compliant mineral resource of 895,000 ounces at Darlot.

The mineral resource is contained in 6.0 million tonnes of ore at 4.6 g/t of gold in the measured, indicated and inferred categories. The previous estimate stood at 1.2 million tonnes at 5.97 g/t of gold for 224,000 ounces.

The resource includes a maiden ore reserve of 1.0 million tonnes at 4.0 g/t of gold for 131,000 ounces, according to the Dec. 21 release.

Production at the Darlot mine for the fourth quarter is on track to be at the upper end of the previously reported guidance range of 13,000 to 16,000 ounces.

Meanwhile, mining at the King of the Hills project is expected to start in January 2018.

Red 5's rights issue to fund the purchase of the Darlot mine received a lukewarm reception from shareholders, only managing to raise A$4.4 million of an envisaged A$12.7 million.