Northern Star Resources (NSR) has confirmed plans to establish a 100,000ozpa standalone operation at its Ashburton sulphide gold project in Western Australia following favourable metallurgy tests.
Northern Star managing director Bill Beament said the accelerated drilling plan and economic studies on Ashburton were aimed at bringing the project into production as soon as possible.
"There are already numerous walk-up drilling targets at Ashburton as well as vast areas of highly prospective acreage which have seen little or no exploration," Beament added.
The results from initial bacterial oxidation test work at project revealed very high gold recoveries of 96.4% from concentrate.
NSR will now undertake a reserve and resource drill out, along with further metallurgical test work and development studies.
The drilling programme will be funded through Northern Star's $80m cash reserves, which also includes the company's $45m capital raising of late last month.
The company could also fund construction project from its internal reserves if it chooses to do so.
Northern Star expects that the standalone operation production would lift total group production to 200,000ozpa.
The company will have to pay a 1.75% royalty on future production at Ashburton in excess of 250,000oz.
The free-milling ore will be trucked from Ashburton to Paulsens which will expand the mill capacity and lift production there to 100,000ozpa.
Northern Star revealed it will undertake further test works to evaluate other processing options for gold extraction from concentrate in the coming months.