Galane Gold's board of directors has given approval for a capital expenditure programme required for the first phase of the restarting of production at its Galaxy Gold mine in South Africa up to a target of 60,000oz per annum.
The firm expects completion of the first phase to take six months and it will be funded from internal cash flows primarily from its core operation in Botswana.
Galane Gold CEO Nick Brodie said: "The second major goal for Galane this year is to recommence production at Galaxy.
“Having achieved our first goal to commence mining in the main ore body at Tau management of the Company can now concentrate on the implementation of the first phase of this project at Galaxy.
“This first phase forms a core part of our long-term strategy to target production of over 60,000oz per year at Galaxy.”
The board has given approval for the $2m first phase, which will begin this month and is intended to renew existing infrastructure and upgrade the processing facility to take production to 18,000oz per annum.
Under the first phase, the existing 15,000t a month processing plant will be refurbished. This will include installation of a new crusher, remedial work to the float section, a gravity separation section and re-establishment of the elution plant.
This phase will also see construction of a new 25,000t a month carbon in leach tailings retreatment plant within the current footprint of the existing processing facility.
Underground mining will recommence at Woodbine, Agnes and Ivy on seventeen level using conventional shrink stope mining.
Tailings recovery will commence by sluicing at the Woodbine and Hostel dumps during the first phase.
The company expects to generate gold at Galaxy at the end of the fourth quarter of 2016.