Horizon Minerals has poured its first gold bars from ore hauled from its Boorara project, near the famous mining town of Kalgoorlie in Western Australia, under its ore sale agreement revealed last year with Norton Gold Fields’ Paddington mill.
Proceeds from the sale are expected to be pumped into the company’s bank account within the week.
The company entered into the ore sale agreement with Norton for 1.24 million tonnes of material from Boorara to be processed across 18 months. It also revealed details of a tie-in with Kalgoorlie firm Hamptons Transport.
The contracted deal with Hamptons will see mining of four open pits at Boorara, containing 1.24mt of ore grading 1.24 grams per tonne (g/t) gold for 49,500 ounces.
When the news of the link-up with Hamptons was revealed, the project was expected to generate $30 million in expected free cashflow at $3600 per ounce gold, however, with today’s local gold price exceeding $4320 per ounce, it is expected to be much higher.
Management struck an impressive deal on the mining services and load-and-haul contracts with no payments to Hamptons required until the first gold pour has been sold, and the sale proceeds are in the bank.
Boorara sits adjacent to Northern Star’s mammoth Super Pit mine in Kalgoorlie that has produced more than 60 million ounces of gold.
Horizon’s first shipment of 54,380t of ore from Boorara was hauled to the nearby Paddington gold mill last December and into the new year. The company says the initial load of ore underwent metallurgical work and assaying prior to its departure and the grade was in line with its expectations.
Management is anticipating the cash-generating load will return 1400 ounces when processed and, based on a $4130 price per ounce, Horizon is expecting an estimated $5.78 million payday net of agreed processing costs and royalties.
The price of gold in local currency terms has continued to strengthen since the estimate was made and is now fetching more than $4320 per ounce flowing from the ongoing depreciation of the local currency against the greenback. The increasing Australian dollar price of gold will only add further to the company’s coffers.
Ongoing haulage of Horizon’s mined number one stockpile has resulted in all the material having been trucked to the Paddington mill’s ROM pad.
Mining is continuing at pits two and four as it builds its next stockpile for haulage.
Horizon Minerals managing director and chief executive officer Grant Haywood said: “We are delighted to become Australia’s newest gold producing company in 2025. We have a mineral resource of 1.8 million ounces across our projects and developing a sustainable gold production pipeline which includes numerous projects that are ready for a final investment decision, such as Penny’s Find and the Cannon projects.”
Management also recently confirmed its joint venture agreement with Kalgoorlie-based contractor BML Ventures to mine 200,000 of ore from its Phillips Find gold project near Coolgardie has ramped-up, with mining to pre-strip waste taking place and exposure to the underlying ore expected shortly.
The ore will be toll treated at the nearby Greenfields Mill over the next 11 months to produce almost 15,000 ounces of gold, with the first ore on track to be processed from February.
A share placement, announced last Friday, has already resulted in $6.345m being pumped into Horizon’s bank account via an at-market share placement of 4.5 cents per share, with a further $3.28m expected shortly.
Management says most of the funds are earmarked for the development of its soon-to-be-producing gold deposits.
Privately-owned Golden Crane Holdings will stump up the total $9.625m via a two-tranche placement in exchange for about 213m shares in Horizon.
Horizon is using its existing placement capacity and has issued the first tranche of shares, with the second tranche expected to follow in the next few months.
The company has a multitude of other promising gold assets and can use the funds to potentially launch into developing the most prospective deposits.
Management also updated the market with news that its merger with Poseidon Nickel remains on track. If the merger wins the support of Poseidon shareholders and proceeds, Horizon will gain access to Poseidon’s mothballed mining plant, which may provide the company with the opportunity to scale-up and commercialise its collection of gold deposits scattered around the Goldfields region.
Horizon is the country’s newest gold producer with a plethora of other potential deposits. With a seemingly ever-increasing gold price in local dollars, the company plans to make the most of the opportunities presented to it.
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By Craig Nolan
