Horizon Minerals says it will bank $30m within 19 months after making a final investment decision to toll mine ore from its Boorara project on the doorstep of Kalgoorlie’s revered Super Pit. The mine, 15km east of Kalgoorlie-Boulder, will start open pit mining in September and the company will truck its ore 35kms north to the Paddington mill near the historic town of Broad Arrow.
Management recently tabled an ore reserve at the project of nearly 1.24m tonnes going 1.24 grams per tonne gold for 49,500 ounces, which will equate to 45,800 ounces at a recovery rate of 92.5 per cent. Horizon is looking to achieve a gold price of A$3,600 per ounce during the toll treating campaign which is currently just shy of the spot price.
The Boorara resource contains a measured total of 1.12 million tonnes (Mt) at 1.22 g/t Au for 44,000 ounces, which will make up the bulk of the initial mine production. Beyond that, the indicated portion of the resource is 6.85 Mt at 1.28 g/t Au for 281,000 ounces and the inferred portion clocks in at 2.56 Mt at 1.26 g/t Au for 103,000 ounces. The total global resource at the project is 10.53 Mt at 1.27 g/t for 428,000 ounces of gold, setting the scene for a bigger mining operation at some stage in the future beyond the immediate toll treating campaign.
Boorara is fully permitted and ready for action, with all necessary statutory approvals in place. Contracts for mining and surface ore haulage at site have been awarded to Goldfields stalwart company Hampton Transport Services. Remarkably, Horizon has managed to protect its initial cashflows in its deal with Hamptons who will not get paid until the first gold is poured, sold and the funds have been received.
A recent ore reserve study at Boorara pointed to a stripping ratio during the toll mining campaign of six to one and the estimated capital costs of the initial production run will be $450,000.
Horizon Minerals managing director Grant Haywood said: "This project positions us as Australia's newest gold producer. With a robust resource portfolio, we aim to develop Boorara alongside other projects, establishing Horizon as a sustainable gold producer in this favourable gold price environment. Our extensive portfolio, holding a 1.8 million-ounce Mineral Resource, offers significant potential. We aim to develop additional projects concurrently, establishing Horizon as a long-term, sustainable gold producer in a favourable market."
Previously, in 2016, Boorara was trial-mined through a small pit in the Royal deposit and then later in 2020 it was further de-risked through three additional pits in the Crown Jewel and Regal deposits.
Mobilisation and site establishment are set to begin immediately, with grade control drilling starting early next month and mining operations will ramp up shortly thereafter. Key positions, including the site senior executive, quarry manager and most technical roles have already been filled and first gold is expected in October.
Horizon is remarkable in that it has a plethora of gold deposits scattered around Kalgoorlie and Coolgardie. While it has a grand plan to eventually build its own substantive mill at Boorara by mining the satellite deposits in addition to the remaining ore at Boorara, the company is making the most of the current gold price and has more than one plan in place for toll treating.
It is also looking to bank some $10m by toll treating ore from its Cannon deposit south-east of Kalgoorlie at the Greenfields mill in Coolgardie.
With individual deposits ranging from 13,000 ounces all the way up to 465,000 ounces in the vicinity, Horizon is spoilt for choice and may well make an entire business model out of toll treating while the gold price continues its epic run.
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By James Pearson
