Dacian Gold Ltd. issued a Letter of Intent (LoI) to award the underground mining contract at its Mt Morgans Gold Project (MMGP) in Western Australia (WA) to WA-based underground mining contractor, RUC Cementation Mining (RUC).

The LoI relates to the underground development and production stoping from the Beresford and Allanson underground mines, which together comprise the Westralia Mine Area. LoI will eventually be replaced by a formal underground mining services contract, which will have an initial term of three years with two discretionary one-year extensions. Under the contract, RUC will establish a new portal for Beresford; rehab an existing portal and decline for Allanson; execute all decline and level development; conduct all ore driving and all stope production.

Dacian said the LoI reflects the company’s ambitions. “We are rapidly ticking the boxes on the path to becoming Australia’s next significant mid-tier gold producer,” said Rohan Williams, executive chairman, Dacian Gold. “With a Letter of Intent issued last month to GR Engineering to build the new 2.5 million [metric ton per year] treatment plant and now to experienced WA-based underground mining services group RUC Mining for the underground mining contract, we now have two of the key contracts in place which are required to bring Mt Morgans into gold production in less than 12 months.”

Construction of a new treatment facility and mobilization of RUC to Mt Morgans is expected to begin later this month, with underground mining set to commence in May.