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Genesis Minerals expands its horizons with new gold mining prospects in the US

Just over two months after completing its purchase of the Leonora gold mining assets of St Barbara (ASX:SBM), Genesis Minerals (ASX:GMD) has taken its rebirth story to the US.

Genesis has made the rounds in Australia with its campaign to justify the St Barbara deal, which followed a hard-fought bidding war with Silver Lake.

GMD paid around half a billion dollars in cash and shares (which were distributed to St Barbara shareholders), with the major asset purchased being the troubled (for St Barbara) Gwalia gold mining operation at Leonora, plus other smaller prospects.

In a presentation to US investors and a statement to the ASX, CEO Raleigh Finlayson pushed the line that GMD was now on its new track with new drilling results from Gwalia backing the company’s new approach to chase quality rather than quantity.

Or as Finlayson put it in the presentation and ASX statement: “margin over ounces.”

GMD said in the ASX release and the presentation that “multiple high-grade drill results” confirm Gwalia’s status as a world-class gold system with an endowment of 5,600oz per vertical meter and support Genesis’ plan to transition Gwalia to a “quality quantity,” high-grade, selective mining operation.

As of June 30, GMD reported Gwalia’s Resources and Reserves at 5.5 million ounces and 2.0 million ounces, respectively.

The company said the latest drilling had confirmed what it termed a “heart of gold” at Gwalia, as “drilling confirms the presence of a consistent high-grade core at the Gwalia underground mine.

GMD also said the results of the infill drilling underpin “the next 7 years of mine production.”

Results include 21.2 meters at 24.1 grams of gold to the tonne, 32 meters of 94.2 grams to the tonne, 10.8 meters of 22.7 grams to the tonne, 1.2 meters of 174.9 grams to the tonne, 3.3 meters of 53.8 grams to the tonne, 5.6 meters of 39.1 grams to the tonne, and 5.1 meters of 36 grams to the tonne.

GMD says these results will help it in its refocusing of mining on the higher-grade South-West Branch of the mineralization at Gwalia, “and deprioritizing the lower grade northern extensions / peripheral mineralization.”

Additionally, drilling continues aimed at “future-proofing” the short, medium, and long-term mine plan at Gwalia with a second diamond recently added.

CEO Finlayson said in Monday’s statement, “the sheer volume of unmined high-grade drill results offered valuable insight into the significant upside at Gwalia.”

“We are committed to transitioning Gwalia to higher grade, selective mining while we ramp up the complementary new Admiral open pit mine and new Ulysses underground mine,” he said. “This combination will deliver the long-term benefits of more production at lower cost.“

The new Admiral open pit mine is designed to use up spare capacity at the Leonora processing facilities. The Admiral open cut will be a 1.6-grams-of-gold-to-the-tonne operation and will supply 1.5 million tonnes to Leonora over the next two years, with the first ore to be delivered in the December quarter.

Looking further ahead, Genesis said that a strategic review of the Gwalia mine is due for release, “including (the) rebuild of the resources, reserves, and life of the mine plan.”

The first quarter of 2024 will see the release of a five-year outlook for the company as a whole (and will include June half-year guidance).

In a separate development, Bellevue Gold has reported more high-grade mineralization from infill drilling at its flagship Bellevue gold project for the second time in six weeks.

In early August, Bellevue reported the results of infill drilling ahead of the startup of mining at Bellevue, which is in the northern goldfields of WA.

It has returned high-grade results from the Bellevue South area and the Armand Main area.

On Tuesday, Bellevue added to the story with high grades reported from infill drilling on the area of mineralization known as Deacon.

New results confirm the high grades and continuity of the Deacon Main deposit, which will be one of the four initial main production areas at the mine.

The company said the underground intersections were close to true width and included: 14 meters at 49.4 grams of gold to the tonne (g/t); 10.9 meters at 20.5 g/t; 14.4 meters at 15.4 g/t; 6.5 meters at 27.2 g/t; and 5.7 meters at 26.0 g/t.

Deacon is one of four early-stage mining areas in the 2023-24 mining schedule with first ore due next month.

Bellevue said ore development was on schedule at the Bellevue South, Armand, and Marceline areas, with stoping also underway at Armand, as surface ore stocks continue to build ahead of plant commissioning.

Looking ahead, construction remains on track with all major components of the plant installed, and the first production set for the December quarter.

Bellevue CEO Darren Stralow said in the statement and presentation to the ASX that “These great results provide more strong comfort about the outlook for the start of mining at Bellevue.

“Deacon is one of four early-stage mining areas within the project, giving us maximum flexibility and diversification.

“The high grades and strong continuity add to the de-risking process as we prepare for first production in the coming quarter.”

Bellevue is one of a number of Australian gold miners doing presentations to investors in the US ahead of the start of the Denver Gold Forum on September 17.

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