Chinova Resources has work underway on multiple fronts to kick off underground operations at the Merlin molybdenum-rhenium-copper project, south of Cloncurry.
General manager and SSE Mick Breen said a project funding application was in progress, with early signs of strong support from the board and a willingness to advance the project to the next phase.
Recognised as one of the richest molybdenum deposits discovered to date, Merlin seemed poised to go into production about a decade ago before a decline in prices for that critical mineral.
The project was placed on care and maintenance, but has a head start for future development – with 3.5km of underground access decline developed and maintained.
Chinova Resources has an infill drilling program underway to enhance geological confidence, define mineralised zones and support updated resource models at the site.
The diamond drilling program, which began on June 27, is expected to run about four months for a total of 6320m drilled across 14 holes.
In addition, Mr Breen said a high-level economic assessment had been completed, indicating a promising return on investment.
“A detailed technical study is currently in progress, running in parallel with sub-strategic reviews focused on environmental permitting and key operational infrastructure components, including power supply, water, site infrastructure, human resourcing, and potential plant modifications,” he said
He said also a detailed work program was underway to update the site’s Safety and Health Management System (SHMS) in preparation for the commencement of underground operations.
“This includes the implementation of a structured Management of Change (MoC) process,” he said.
“In parallel, the site has commenced the rollout of its Critical Risk Management (CRM) framework to ensure that all material unwanted events and associated critical controls are clearly defined, well understood, and effectively aligned with the foreseeable risks related to underground mining and surface activities.”
The renewed focus on Merlin comes as activity winds down on Chinova’s nearby Starra mining operations.
Processing ore from Starra 222 and Starra 254 came under Chinova’s Osborne Extended Mine Life project, making the most of the Osborne flotation plant, 150km south of Cloncurry, after production from the Osborne mine ended.
“Surface mining activities under the EML are forecast to conclude by August 2025, with full depletion of in-pit resources,” Mr Breen said.
“Haulage operations will extend through to October 2025, providing adequate mill feed to maintain processing through to December 2025.
“Overall site performance for FY25 is tracking strongly, with operating costs trending below budget, production volumes meeting corporate guidance for both copper (tonnes) and gold (ounces), and net revenue exceeding budgeted forecasts.
“This result reflects the strong performance and commitment of the site team.”