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NEWS

Development bell tolls

for Bellevue

by Dominic Piper

he market may have turned some of its attention to new,
Tshiny things but Bellevue Gold Ltd remains on course to
become a Top 20 Australian gold mine in the next 18 months.
Bellevue – GMJ’s Explorer of the Year for 2018 and 2019 – has
seen its share price level off in 2021 as spot gold drifted and
investors became enamoured with the likes of De Grey Mining
Ltd and Chalice Mining Ltd. The company and its namesake
project are far from stalled however, with a discovery rate of
70,000oz/month being maintained and financiers falling over
each other to provide the debt and equity needed to build the
project.
Exploration continues at full pace at Bellevue despite the shift
Bellevue released an updated feasibility study (FS2) for the
towards development
project – 400km north-west of Kalgoorlie – in September,
just four months after producing the first iteration. Managing
director Steve Parsons said the update was necessary production because production means cashflow, which means
because of the rapid progress Bellevue continued to make. more funding for exploration and paying dividends, etc.”
“When you are adding 70,000oz a month, as we have been That attitude reinforces Bellevue’s switch from explorer to
doing from Day 1, a feasibility study can only ever be one developer, a move which was confirmed with the successful
moment in time,” Parsons told GMJ. “We never said it was completion of project financing in September. The package is
a 5 moz system, we only ever set expectations of 0.5 moz, 1 a conventional debt/equity split with Macquarie Bank providing
moz, 1.5 moz and so on but here we are at 3 moz gold and it a $200 million credit facility at 3.5% – dropping to 3% p.a. post-
is still open. project completion – with only 135,000oz hedged.
“We had committed to releasing the study in April and we had The equity component comprised a $106 million institutional
to stick to that even though we had another 10,000 samples in placement and a SPP to raise $25 million.
the lab and another 12,000m of core drilled. It is the same with
“Our view is that if you are planning to de-risk the project and
FS2, we have 14,000 samples in the lab. So, the study is out of
the company you might as well get it done in one go,” Parsons
date even before you publish it.
explained about the size of the finance package. “You never
“Every 100,000oz of reserves adds $140 million free cash flow know what the market will be like in the future but this insulates
so we can add more than $100 million a month at the current us against the market, taking us all the way through to first
rate of discovery.” gold pour.”
That rate of discovery clearly points to the robustness of the The additional funding will also allow Bellevue to steer around
project. The updated feasibility saw tonnes mined over the the junior developer’s usual problem of sacrificing exploration
life-of-mine increased by 45%, largely via the introduction of a for construction priorities.
larger 1 mtpa plant. Average life-of-mine gold production also
“It allows us to execute our dual-track strategy of getting the
increased by 21% to 183,000 ozpa with an average of 200,000
project built and continuing to push the exploration,” Parsons
ozpa in the first five years. Total capex was kept in check at
said.
$252 million (compared to $255 million in the original feasibility
The company is also conscious of a recent trend among
study).
developers to save money during the construction phase by
Further resource estimates are expected before production
lowering the drilling budget. Parsons said the next 18 months
begins but Parsons said the company was moving beyond
would see Bellevue get a good handle on the orebody.
feasibility study updates.
“We’re all about de-risking every aspect of the project,” he said.
“We won’t keep updating the feasibility study now, we will
“By first gold we will have drilled 500,000m of diamond and
just upgrade reserves and resources and publish some
this current programme will include $10 million of grade control
optimisation numbers,” he said.
drilling. We have just completed the first phase of that grade
“We could probably redo the study every six months but our control on a portion of Tribune. It is showing good continuity.”
view is that we want to get on with building it and get into
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