Auric Mining has started milling the second ore parcel from its 100 per cent-owned Jeffreys Find mine near Norseman and expects the first cash to land in the till next month – at a serendipitous time of strong gold prices.
The company says the 145,000 tonnes of ore will take about seven weeks to process with 52,000 tonnes already delivered to the Greenfields Mill in Coolgardie. The balance of 93,000 tonnes will be hauled from the mine during the campaign and processing started yesterday.
Auric says the stage-one project has been underway for several months, with a maiden parcel of 36,180 tonnes already milled at Greenfields at 93.04 per cent recovery, yielding 1721 ounces of gold from a head grade of 1.58 grams per tonne.
Auric Mining managing director Mark English said: “This is the money round for Auric Mining. It’s the culmination of a three-year strategy from time of acquisition to bring Jeffreys Find into production and generate free cash to Auric. As this 145,000-tonne parcel is processed, we can expect sizeable cash payments to Auric in October and November. With a gold price around AUD$3,000 an ounce we have hit a sweet spot in this project. Our timing could not be better, which is great news for Auric.”
The Jeffreys Find deposit boasts 1.21 million tonnes grading 1.22g/t gold for a total of 47,200 ounces. With a mine life of just under two years, Auric appears to have a profitable mining operation based on a gold price of $2600 per ounce. The project is a joint venture (JV) between Auric and Kalgoorlie-based mining engineering and geological services provider BML Ventures, with the latter paying all costs in relation to mining the gold resource at Jeffreys Find.
Auric says the project is on target to mine and process a total of about 180,000 tonnes of ore from the first-stage pit, with plans to expand to a second-stage pit next year. Once the first phase of mining is complete, the JV partners will subtract all costs, including a cash retention for the second-stage pit, before retaining an equal share of the net cash surplus.
That means Auric should receive a timely cash boost in the next two months.
Management plans to put its surplus cash to work by continuing with the development of its Munda gold deposit at Widgiemooltha and with broader exploration around Norseman, where it holds about 640 square kilometres of tenements in four project areas.
Munda is a significant deposit and Auric says it hosts a resource of about 198,700 ounces of gold at a grade of 1.38g/t. It is about 34km south-west of the mining town of Kambalda, in ground about 3km south-west of Mincor Resources’ Widgiemooltha gold project, which has a mineral resource of 4.3 million tonnes at 2g/t gold for 273,600 ounces.
A recently-released scoping study on Munda outlined a cashflow surplus of $76.9 million under a base-case scenario using an assumed gold price of $2600 per ounce.
Auric has moved quickly since listing on the ASX in February, 2021, achieving gold production in less than three years. With the Munda deposit boasting significantly more gold than Jeffreys Find, the company’s demonstrated ability to process ore and a solid gold price, Auric looks set to keep hitting its financial straps.
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By Andrew Duffy
