A mining company will use millions from the sale of a Western Australian gold mine to fund an “aggressive exploration and drilling program” near Castlemaine.
Kalamazoo Resources will put the $7 million from the sale of the Snake Well Gold Project towards its Wattle Gully Gold Project near Castlemaine, as well as other mining activities in Western Australia.
The sale was recently completed.
Kalamazoo acquired the Wattle Gully Gold Project last June.
The exploration licence covers 70 square kilometres, including a large swathe of the Castlemaine Diggings National Heritage Park, and is valid for an initial five years.
It sits about five kilometres from Castlemaine.
The company has also made an application for an exploration licence for an area of 218 square kilometres to the east and south of Wattle Gully.
Kalamazoo says “the Castlemaine Goldfield has not been tested comprehensively at depth leaving open the prospect of repetitions of mineralisation at deeper levels”.
Related: GBM Gold wait for loan drags on
The company says there are some exploration techniques, such as gravity and seismic surveying, that have not yet been used at the site.
The Castlemaine goldfield was the third-largest goldfield in Victoria.
Consultation with councils and local stakeholders will be an “early and ongoing priority”, Kalamazoo says, and it will minimise or mitigate any detrimental environmental impacts.
At a minimum, the company pledges to work to Victoria’s Code of Practice for Mineral Exploration, which states exploration projects should have little or no lasting environmental impact.
As part of the Snake Well sale, Kalamazoo can engage Queensland-based Mitchell Services to provide up to $4 million in drilling services at Wattle Gully.
The Bendigo Advertiser has contacted Kalamazoo for comment.
Have you signed up to the Bendigo Advertiser's daily newsletter and breaking news emails? You can register below and make sure you are up to date with everything that's happening in central Victoria.