Larvotto Resources (ASX: LRV) announced on Tuesday an offtake agreement with Glencore (LON: GLEN) for the sale of gold concentrate from its 100%-owned Hillgrove antimony-gold project in New South Wales.
The agreement covers gold concentrate production during the first seven years of mining operations, with expected annual offtake being approximately 15,000 dry metric tonnes, the company said.
The agreement is structured on a mine-gate basis, with Glencore responsible for all logistics from the mine to the final customer destination.
Together with the antimony concentrate the agreement completes the company’s key concentrate marketing strategy for Hillgrove’s primary concentrate products, it said.
“As we move closer to first production at Hillgrove, securing a globally recognised offtake partner for our gold concentrate is another important milestone in the transition from development to operations,” managing director Ron Heeks said.
“As expected with the strength in the gold price, there was a high level of interest for the offtake during the tender process from all major commodity houses,” Heeks said.
“Metallurgical testwork continues for the potential production of a tungsten concentrate by-product from Hillgrove, with offtake discussions expected to progress as development activities advance.”
Last year, the company reported 90% tungsten recovery with a 16X increase in feed grade delivered in metallurgical testwork, which it said also indicates a simple and cost-effective processing circuit would produce a saleable tungsten concentrate.
First production at Hillgrove remains on time and budget, the company said, with commissioning expected in August this year.
Larvotto’s stock traded flat on Tuesday. The company has a A$690.3 million ($485M) market capitalization.
