Home' Greymouth Star : November 1st 2014 Contents Greymouth Star
West Coast Features
of the Otago Daily Times
preliminary report on
reopening the historic
Blackwater goldmine at
Waiuta would require
a tunnel to advance
exploration — which has been costed
at $US78 million ($NZ97.7 million).
The project is “technically stalled’’ at
present and owner Oceana Gold does
not appear to be rushing to take it to
the next phase, which requires more
exploration at greater depths.
As Oceana’s northern Philippine
gold and copper mine, Didipio,
continues to ramp up and provide
highly profitable returns on gold sales,
the company is considering winding
down its New Zealand operations
during the next two years at Macraes,
in East Otago and Reefton because
gold production costs are many times
that of the Philippines.
Oceana this week lodged a 225-page
‘preliminary economic assessment of
the Blackwater gold project ’, with the
New Zealand and Australian stock
Oceana said it undertook the study
to assess technical and economic
potential of the Blackwater project,
and to support investment decisions
for an exploration decline (tunnel).
Oceana said environmental studies
were complete and resource consent
“Due to the scale of the investment
relative to the size of Oceana Gold’s
operating activities, the project can
be funded from Oceana Gold’s
operational cashflow, should it so
choose,’’ the company said.
A spokeswoman said this week
that while “the base case economics
are robust ’’, Oceana had not made a
decision to advance the project into
the next phase.
“Each opportunity we have is
required to compete for capital to
maximise shareholder value. There
is no timeline in place on a decision
to advance this project to the next
phase,’’ she said.
Oceana said in the ‘conclusions and
recommendations’ of the report: “ The
results from this study demonstrate
that the project is technically
and economically viable and it
is recommended that the project
advances to construction of the
exploration decline’’. Further diamond
drilling could move the project to a
full feasibility study.
Oceana estimated a two and half
year pre-production start up, then
a 10-year mine life. About 120,000
tonnes of ore per year would yield
58,000oz, recovering a total estimated
570,000oz, producing the rough
“dore’’ gold bars, which are sent to
mints for refining.
Because of the depth and geometry
of the Birthday Reef, which hosts
the gold resource, and surface land
ownership constraints, Oceana said
the project was “technically stalled’’
because it cannot be progressed from
the surface, in order to determine the
commercial viability of the estimated
“ Further evaluation work and
appropriate studies are required to
establish sufficient confidence that
this (gold) target will be met,’’ Oceana
said in the assessment.
The Blackwater Mine, 37km
south of Reefton, lies beneath the
abandoned township of Waiuta, in the
foothills of the Victoria Range, about
440m above sea level.
Historically, 740,000 ounces
of gold had been recovered from
Blackwater from 1908 to the time of
shaft collapse and closure in 1951.
From 1.6 million tonnes of ore, a
remarkable 14.6g of gold per tonne of
Each vertical metre of the Birthday
Reef in the Blackwater Mine was
credited with having yielded 1000
ounces of gold.
The permitted area covers about
4308ha and Oceana had entered into
an option agreement to acquire the
land required for surface infrastructure
works, which expires in April 2016.
Oceana had received resource
consent for the construction of an
exploration decline, mining and
associated infrastructure works, but
requires specific building permits. A
variation to the resource consent was
also required, to permit on site ore
processing and co-disposal of filtered
An ‘independent technical report’ on
the project by Brisbane-based AMC
Consultants Pty Ltd looked at the
results of deep drilling, during 1996
and 2010-13, and the intersections of
gold within four holes by Oceana, and
Oceana had said the results had
indicated the Birthday Reef continued
for at least 680m vertically below the
last worked level of the Blackwater
AMC considered that the inferred
gold estimate, as reported by Oceana,
was a “reasonable estimate and is
satisfactory’’, provided adequate
account was taken of the inherent
variability in the mineralisation.
The mineral resource estimate
for Blackwater’s Birthday Reef, at
December last year, was 700,000oz
of gold, from 900,000 tonnes of ore,
equating to 23g of gold per tonne.
AMC said twin declines will be
developed, both 4m by 4m with a 1:7
gradient, with one as the main access
and intake airway and the other as the
return airway, which would eliminate
the need for ventilation shafts to
AMC estimated two and a half
years of pre-production activity
was required to establish the access
decline, and initial underground
exploration drilling platform.
Capital expenditure during the first
two years, where there was no ore
mined, was estimated to be
“ Blackwater pre-production mining
capital amounts to $US30m and
capital costs for the life of the mine
amount to $US98m,’’ AMC said.
More representative samples to
validate the metallurgical test work
already done would only become
available from underground drilling,
“Only when this information is
collected and analysed will the project
not be technically stalled,’’ AMC said.
8 - Saturday, November 1, 2014
Seems like only
October 21, 1989
Old McBrearty ward
due for demolition at
Grey Hospital now
Footsteps echo hollow now in
the old McBrearty Ward of the
Not so many years ago, the corridors
were filled with nurses, babies and
For the nurses who once trained in
the old ward the news has produced a
The good times and comradeship
are remembered — but so, too, are
the cracked walls and the cluttered
Patsy Sara started her training in
1961 and went on to become charge
nurse in the old ward. She is now a
practising obstetric nurse in the new
McBrearty ward and the McLaurin
She says the old ward ser ved its
purpose, and she wouldn’t go back —
but the memories are good.
October 24, 1989
A new sport, recreation
complex is opened
About 200 Boys’ and Girls’ Brigade
members from Hokitika, Greymouth
and Canterbury companies took
part in the opening of the Fourth
Westland Boys’ Brigade company ’s
new sport and recreation complex in
The building at the Westland
racecourse, comprises a gymnasium
for the brigade and a tearooms and
lounge for the Westland Racing Club.
The project was carried out by the
brigade in conjunction with the
Although the complex is now
officially opened, there is still to be
undertaken “the hard part” of raising
extra funds to finish it off, president
of the project committee, Mr Graham
The complex will be worth around
$250,000 when fully completed and
will be hired out for sports and social
functions when not needed by the
brigade or racing club.
October 24, 1989
Big Lotto prize to
A Westport sickness beneficiary is
$375,000 better off today.
Floyd Smith, who is in his 40s,
won a first division prize in Saturday
night’s L otto draw.
He bought his winning ticket at
Westport’s only Lotto outlet, Dennis
Bookshop and Stationery.
Heather Dennis said she was
thrilled for Mr Smith who has been
on sickness benefit for about five
years. It is the first time the store has
sold a major prizewinning ticket.
October 26, 1989
Crown’s Coast forestry
resource now for sale
West Coast exotic forests under the
control of Timberlands went on sale
yesterday, along with the rest of the
Crown’s forestry resource.
Also up for sale are the region’s
indigenous forests, but under
conventional sale terms rather than
those proposed for the exotic estate.
The exotic estate is to be sold as a
standing crop, subject to a Crown
Forestry licence. Also included are all
The Coast forests will be offered as
a single entity, rather than blocks, as
will be the case for the rest of New
With the sale, which is due for
settlement about August of next
year, Timberlands will go out of
existence, but district manager Mr
Dave Hilliard said he considered
there would be ample employment
opportunities under new ownership.
Twenty five years ago, the old McBrearty Ward was being prepared for demolition, the
Boys’ Brigade opened a new sport and recreation complex in Hokitika, and the Crown’s
West Coast forests were up for sale. Read more from the yellowing pages of the
Greymouth Evening Star of October 1989.
Lorna Strange and Patsy Sara in the ‘new ’ McBrearty Ward, October 1989.
Cobden Rugby Football Club celebrated its 100th in October
1989. Jack Minchin cut the cake, helped by Harry Mettrick and
Oceana Gold’s test drilling rig at the Blackwater mine at Waiuta two years ago.
The $97m Waiuta dream
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