OceanaGold’s mine expansion creates high hopes in South Carolina

Australia’s OceanaGold (ASX, TSX: OGC) filed this month before the South Carolina Department of Health and Environmental Control an application to expand its Haile gold mine, which is currently an open-pit operation with additional underground resources located near the town of Kershaw in Lancaster County.

The filing before the state is the first step to get the proposed project approved, as it would, later on, have to go through federal environmental regulators. In its quarterly report, the company said it expects receipt of these permits by the end of 2019 or early 2020.

OceanaGold wants to grow the 1842-hectare site by more than 360 hectares and dig an underground mine that would extend up to 400 metres below the surface

But the prospect of an enlarged operation is already creating high expectations in Kershaw. According to local newspaper The State, hopes are high given the possibility that the project creates 250 new jobs in the former textile community with a history of unemployment. The publication says that the reopening of the mine in 2016 after OceanaGold acquired it from Romarco Minerals the prior year, has already had an $87 million annual economic impact.

In detail, OceanaGold wants to grow the 1842-hectare site by more than 360 hectares and dig an underground mine that would extend up to 400 metres below the surface, while combining five existing excavation pits. Company officials have said that front-end engineering design activities for the of the larger open pits and Horseshoe underground pit are currently underway.

The site’s tailings pond would be also enlarged to hold 72 million tonnes of wastewater, up from 40 million tonnes.

The Aussie miner believes that at least $2 billion worth of gold exists far below the surface.

In its current design, Haile produces over 130,000 ounces of gold per year, with 2019’s guidance expected to be between 145,000 and 160,000 ounces of the yellow metal.

In the first quarter of 2019, the mine produced 25,717 ounces of gold after 3.8 million tonnes including 0.6 million tonnes of ore were mined.