May/June 2013 - The ASIA Miner

Mining Success Stories
New life for
HISTORIC BALLARAT GOLD OPERATION
By John Miller, editor The ASIA Miner
LionGold’s Ballarat Gold Mine is surrounded by residential and commercial properties in Ballarat’s southern suburbs.
SINGAPORE-listed LionGold Corporation has
helped a junior Australian company turn
around the fortunes of the historic Ballarat Gold
Mine, continuing a heritage of mining in the
Australian city which stretches back more than
150 years. Since completing a takeover of
Castlemaine Goldfields in 2012 and backing
up the mining expertise of that company with
its financial strength and business acumen, LionGold
has become a gold producer and aims
to make its mark on the world gold stage.
The mine is only a small producer compared
to the world’s major mines but difficult
geology and location under a settlement of
100,000 people make it a modern day success
story and one that has put the Victorian
Goldfields’ city back into the spotlight. The
operations and processing facilities are ringed
by Ballarat’s southern suburbs, the decline
extends 3.5km to the north under the city,
and the area being mined is about 4 blocks
from the city centre and about 600 metres
under the ground.
LionGold’s group chief operating officer
Matthew Gill, who is also managing director
of Castlemaine Goldfields, says the company
is intimately associated with the city which
means noise, dust, vehicle access and vibration
are key environmental considerations.
“Another important factor is water management
with ground water discharge from the
underground mine treated and discharged
under our strict environmental discharge licence.
In line with other environmental licence
obligations, the cyanide solution used
in the processing of gold ore is treated (destroyed
chemically) and the resultant solution
contained on site within a purpose-built fully
lined and self-contained tailings dam alongside
the Yarrowee River.”
He says, “Community interaction is fundamental
and there is a consultative committee
that meets quarterly and is chaired independently.
It is important in all mining operations
but even more so here because of our
location. We recognize that it is important to
be proactive and some of our activities have
included a community survey, the publication
of a regular community newsletter, mine open
days, visits to local schools and we sponsor
a primary school teacher in the local area.”
The 1850s gold rush provided the kickstart
for mining in the region and there are
deep mining roots which mean most people
are interested in it and acknowledge its
importance. There is also the Sovereign Hill
gold mining tourist village next door to the
mine, the adjacent gold museum and Eureka
Stockade precinct marking the 1854
rebellion by gold miners, which add to the
mining heritage.
“We directly employ 150 people who all live
in the area while the gearing of indirect employment
is about three-to-one, meaning
some 450 people benefit from our business,”
he says. “Our payroll is about $1 million a
month and then there are the goods and
services purchased locally. The employment
and mining heritage give us a degree of understanding
and support by the community
that many other communities don’t have, but
we can’t take it for granted and have to keep
working at it. There are people in Ballarat who
don’t know we are here so our commitment
to consultation is vital. Our operations and
historic workings are screened by trees and
vegetation, including pine plantations, and together
with extensive, ongoing engagement,
we believe the community has given us a licence
to operate.”
Gold processing results in 75% of the gold
being recovered using gravity processes
(gold is exceptionally heavy) with another
10% achieved through dissolving gold using
a cyanide solution. With the waste and
detoxified water then going into the tailings
dam, water recovery is important. No water
from the tailings dam is discharged to the environment.
Castlemaine does extensive underground
mine water discharge monitoring.
Noise and dust are constantly monitored with
the nearest house only 200 metres away.
There is also a curfew on bringing goods and
materials onto the site with no deliveries at
night or on weekends.
Castlemaine Goldfields the company listed
on the Australian Stock Exchange in 2005
with three tenement packages in the Central
Victorian Goldfields – Castlemaine which was
the third largest gold producer in Victoria behind
Ballarat and Bendigo, and features
prominently in gold rush stories; Sebastian,
immediately north of Bendigo and site of the
Frederick The Great mine; and Tarnagulla,
well known for nuggets including the 71kg
Welcome Stranger found in 1869 and which
is the world’s largest alluvial gold nugget. The
Castlemaine tenement includes Wattle Gully
mine which was mined from the 1930s to the
1990s, producing over 400,000 ounces.
About 200 metres east of that mine the company
discovered a parallel zone called the
Chewton Deposit and in 2008 a JORC inferred
resource of more than 600,000 ounces
was announced. The company is now drilling
to infill this resource.
4 | ASIA Miner | May/June 2013