Auric Mining is set to become WA’s next gold producer after executing a 150,000 tonne gold ore toll milling agreement with the Greenfields Mill at Coolgardie for its Jeffreys Find gold deposit near Norseman.
In a major milestone for the company mining will commence in early April and as part of the deal mining contractor BML Ventures (BML) will incur and pay all costs in relation to mining the gold resources.
The 150,000 tonnes of ore will be delivered to the mill with expectations that all processing will be completed and gold delivered to the Perth Mint by the end of September 2023.
Auric and BML will then retain an equal share of the net cash surplus after payment of all mining and processing costs.
Auric says the toll milling agreement between FMR Investments (FMR) and BML was executed on March 30 paving the way for gold production and cash generation.
Auric Mining and BML have executed a formal “Decision to Mine Notice” and BML is now mobilising equipment for the commencement of mining in early April with mine planning also underway.
FMR’s Greenfields Mill is located 3km east of Coolgardie and has a long history as a gold ore toll milling facility with appropriate procedures in place for processing ore from multiple clients.
Auric Mining managing director Mark English said: “This is an important stage in Auric’s growth to be generating cash within the next six months with negligible downside to Auric is a terrific result. The cash generated will be used to advance our exploration projects and Munda gold deposit – Our timing is perfect with the surging Australian gold price.”
The mining at Jeffreys Find is currently planned in carried out in two stages, namely a starter pit and a final pit. Auric’s agreement with BML includes provision for an interim split of surplus cash following completion of the starter pit and the toll milling agreement with FMR covers the ore from the starter pit.
Auric’s Jeffreys Find gold deposit has a resource of 1.21 million tonnes grading 1.22 grams per tonne gold for a total of 47,200 ounces of gold.. Jeffreys Find gold mineralisation extends from the surface to at least 110 m vertical depth and is thickest at surface.
Management says the approximately 150,000 tonnes of ore from the starter pit will be delivered to the Greenfields mill across three parcels. The starter pit will be mined from April through to July. The first delivery of ore to the mill is scheduled for early June. Auric expect that all processing will be completed and gold delivered to the Perth Mint by end of September.
Auric has received approval of a “Small Mine – Mining Proposal” from the West Australian Department of Mines, Industry Regulation and Safety. The approval allows for the start of mining at Jeffreys Find and completion of the starter pit. The “Full Mine – Mining Proposal” is currently being assessed by the department.
The company has completed grade control drilling at Jeffreys Find with the results being used in the ongoing detailed mine planning.
A haul road has been built and the company expects that ongoing work will be required to compact and sheet the road during mining.
Auric has a substantial 640 square km tenement holding between Kambalda and Norseman in WA with a gold focus and an eye on rare earths and nickel opportunities. Part of the company’s tenement covers a substantial part of the north end of geological feature the Widgiemooltha Dome which sits close proximity to three significant gold projects that have been discovered or developed in the past ten years containing a combined 5.45 million ounces of gold resource at the Higginsville, Beta Hunt and Mandilla gold mines.
The company’s total JORC resource base is 5.69 million tonnes at 1.35g/t gold for 245,900 ounces with contributions from its Munda and Jeffreys Find deposits. The flagship Munda deposit contains 198,700 ounces of gold in mainly drill indicated resources and includes high-grade intercepts such as 13m grading 14.62g/t.
While it currently has all its guns pointed at the gold, Auric’s large land position appears to have potential for a grab at other metals should a move take its fancy in a region also known for world class nickel and lithium deposits.
The Widgiemooltha area has been in the news recently following a shallow high-grade nickel discovery by Dynamic Metals.
Auric tenements are also near existing nickel mining operations including Cassini, Wannaway, Mariners and Miitel around the Widgiemooltha Dome providing the company with plenty of nickel exploration potential for the future.
Lithium in the Widgiemooltha area is reported from a number of projects including the Dome deposit with 11.2 million tonnes running 1.2 per cent lithium oxide. Mt Marion, some 50km north of the Auric ground, hosts a 71.3 million tonne resource grading 1.4 per cent lithium oxide in the same greenstone belt.
However that’s all for a future discussion, right now it is all about the precious yellow metal and the income it stands to provide Auric Mining. It looks to be a remarkable achievement that in just over two years since it listed Auric finds itself in a position to potentially protect its share structure by using the money generated from Jeffrey’s Find to fund further exploration at its flagship Munda deposit. It’s a position many fellow explorers will be envious of.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Terry Bates
