Australian gold producer and exploration company Northern Star Resources has reported a 66% boost in resources to 1.67 million oz at its Ashburton Gold Project in Western Australia.

Updated resource includes 7.4 million tonnes of oxide ore at a grade of 2.7g per tonne for 647,000oz and an additional 13.9 million tonnes of sulphide ore at 2.3g per tonne grade at 1.02 million oz.

Increase in resources brings Northern Star’s total resources to 2 million oz, which reinforces the company’s strategy to establish a standalone operation at Ashburton.

Northern Star now plans to develop a maiden sulphide reserve for Ashburton, scheduled for completion post July 2013.

With economic and technical studies in the advanced statges, the company seeks to undertake a two-stage development strategy.

Stage one is based on an oxide project and stage two will comprise a sulphide processing plant.

The company plans to set up a long life, high-grade sulphide operation at Ashburton and begin production as a free-milling operation.

Northern Star managing director Bill Beament noted that resource now has considerable scope for further increase.

"But to have it in WA, just 200km from our existing Paulsens project, with all the certainty and other significant benefits that it brings, is very valuable for Northern Star shareholders.

"It is becoming increasingly clear that Ashburton will be another standalone operation with low costs and strong cashflow, giving Northern Star the project diversity and critical production mass being demanded by investors," Beament said.

The company acquired the past producing Ashburton project in February 2011, where 340,000oz of gold at a 3.3g/t grade was mined between 1998 and 2004.

NRI Energy Technology