Ora Banda Mining has increased gold production and the head grade from its Davyhurst mine in Western Australia’s Goldfields region for the third consecutive quarter while lifting its gold sales by 15 per cent.
According to its December quarterly report, the company produced 16,340 ounces of gold at a head grade of 2.1 grams per tonne and sold 15,387 ounces from its Davyhurst operations for the three-month period. Notably, all-in sustaining costs per ounce (AISC) reduced by 15 per cent compared to the previous quarter.
Ora Banda’s AISC for the months of November and December dropped to an average of $2157 per ounce due to a reduction in the strip ratio at its open pit, a mill shut down in October and significant crusher upgrades in November.
The company also set records at its Missouri and Sand King open pits, mining a combined 337, 683 tonnes for 21,312 gold ounces, representing a quarterly increase of 35 per cent and 47 per cent respectively. However, open pit mining at Sand King wrapped up this month with the focus switching to underground exploration. Two diamond drill rigs kicked off the 33-hole underground campaign, with a total of 2204m completed in the quarter.
Management says the development of the Riverina underground mine is on target with first ore from the Main Lode deposit developed four weeks ahead of schedule with a total of 13,450 tonnes mined during the quarter at 2.8g/t for 1221 contained ounces.
Financially, Ora Banda finished the year with more than $19 million in cash despite spending $16.8 million on growth capital, $3 million on infrastructure and $2.7 million on resource definition and exploration.
The company’s cash figure includes $10 million it received as part of its Goldfields project farm-in agreement with Wesfarmers subsidiary Davyston Exploration, with another $20 million expected this year once that transaction has been completed. As part of the deal, Davyston will get 65 per cent of the lithium rights at the Davyhurst gold project north of Kalgoorlie, while Ora Banda retains a 35 per cent interest and will be free-carried to the completion of a definitive feasibility study.
Ora Banda Mining managing director Luke Creagh said: “The December quarter marked a key transition period for the Company as we achieved many of the value catalysts that we have been working towards over the past 18 months. This has culminated in first ore from Riverina Underground, costs reducing in open pit mining, significant reduction in AISC/oz, major projects completed in the processing plant and entering a Lithium focused joint venture with WESCEF.”
The company finished last year with 192,000 tonnes of high and medium-grade ore stockpiles containing about 9700 gold ounces.
Its processing plant produced 12,190 ounces at an average grade of 1.6g/t gold during last year’s June quarter. That figure increased to 14,377 ounces at 2g/t gold in the following quarter.
Total gold produced by Ora Banda for the September quarter was 16,952 ounces which included 2575 ounces received from third-party toll treatment at the Greenfields mill in Coolgardie. Management says this campaign used excess lower-grade ore stockpiled that did not form part of the Davyhurst processing schedule.
After four quarters of relatively flat figures at Davyhurst, the plant appears to have now hit its straps with both increased grade and production following some significant improvements over the past six months.
The company expects to mine a lode grade of 10 grams per tonne gold at Riverina as part of its “Drive to 100” campaign which outlines plans to produce 100,000 ounces of gold annually by 2025.
First stoping at Riverina is expected in the March quarter, with steady-state production expected next financial year of 600,000 tonnes per annum at a reserve grade of 4.3g/t for about 80,000 gold ounces per annum.
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By Michael Philipps
