Quarterly Activities/Appendix 5B Cash Flow Report

Brightstar Resources Limited (Brightstar or the Company) (ASX: BTR) is pleased to present its Quarterly Report and Cash Flow Report.

Highlights:

• A positive mine restart study was completed for the development of the Menzies and Laverton Projects with compelling and robust operational and financial outputs¹:
  • An initial mine production target of 5.28 Mt @ 2.00 g/t Au for 322,617oz over 8 years
  • Average recovered ounces of +45koz pa in first five years, with average LOM production of ~40kozpa
  • NPV8 of A$103 million and IRR of 79% (@ A$2,900/oz gold price)
  • Payback of 1.5 years on pre-production capital costs of A$22 million
• Mining commenced at the Selkirk Deposit within the Menzies Project with gold production and sales anticipated in Q1 CY2024 at current record high gold prices of +$3,100/oz
• Cork Tree Well drilling returned significant extension and infill results up to 109 g/t Au²:
  • 1m @ 109.6 g/t Au from 167m and 3m @ 8.7 g/t Au from 197m (BTRRC224) – Delta
  • 18m @ 2.75 g/t Au from 83m (BTRRC225) – Delta
  • 9m @ 3.05 g/t Au from 203m (BTRRC229) – Cork Tree Well
• Drilling at the Menzies Gold Project returned multiple high grade gold intersections:
  • Aspacia^3,4:
    • 1m @ 39.58 g/t Au from 56m (MGPRC020)
    • 1m @ 12.12 g/t Au from 113m (MGPRC014)
    • 1m @ 16.16 g/t Au, within 4m @ 4.79 g/t Au from 112m (MGPRC025)
  • Link Zone⁴:
    • 1m @ 13.95 g/t Au from 45m (MGPRC036)
    • 4m @ 3.21 g/t Au from 40m (MGPRC034)
• A follow up RC drilling program has been planned and a drill rig will be mobilising to site to complete ~5,500m of drilling at Menzies in this quarter
• Mining commenced at the Selkirk Joint Venture in Menzies by our JV partner BML Ventures
• Menzies gold and lithium tenure expanded in deal with Ardea Resources (ASX:ARL)
• Earn-in Agreement executed with DevEx Resources (ASX:DEV) for non-gold rights at Goongarrie
• $3.5 million raised via a Share Placement to accelerate exploration and development activities

Operations Overview

Key activities for Brightstar Resources Limited (Brightstar or the Company) (ASX: BTR) during the September Quarter are outlined below.

Mine Restart Study¹

A positive mine restart study (Study) was completed in September for the development of the 100% owned Menzies and Laverton Gold Projects. Highlights from the study include:

• Initial mine production target of approximately 5.28Mt @ 2.00g/t Au for 322,617 oz over approximately 8 years
• Average recovered ounces of +45koz pa in first five years, with average LOM production of
• ~40kozpa and strong potential to increase production profile and mine life
• Average recovered ounces of +45koz pa in first five years, with average LOM production of ~40kozpa and strong potential to increase production profile and mine life
• The staged mine plan provides early cashflow from the Menzies Gold Project to organically fund the restart of the Laverton Gold Project
• Total project pre-production capital of approximately $22 million
• Rapid restart with first Menzies gold within six months of mining commencement and first Laverton gold within nine months from the commencement of processing plant upgrades
• Study highlights robust financials and a competitive cost profile utilising conservative pricing assumptions and current cost environment:
  • Net Present Value (unlevered, pre-tax, 8%) of A$103 million using a gold price of A$2,900/oz
  • Pre-tax internal rate of return (IRR) of 79%
  • NPV8 at current spot gold price (A$3,000/oz) of A$128m and IRR of 106%
  • Payback period of 1.5 years, underpinned by 70% of material processed being Measured and Indicated Mineral Resources
  • All-In Sustaining Costs (AISC) of A$2,041/oz
• Strong returns on investment driven by low capital start-up metrics delivers a readily fundable project development:
  • NPV / Capex ratio of 4.6x
  • Capital Intensity of A$559/oz (pre-production capital divided by annual gold production)

The very encouraging Scoping Study highlighted the strong economic case for recommencing mining operations at Brightstar’s Laverton and Menzies Gold Projects, with all Mineral Resources included in this study contained within granted Mining Leases in the Tier-1 mining jurisdiction of Western Australia.

The total estimated net revenue for the project is estimated as $899.6M using a gold price of AUD $2,900/oz fixed for the life of the project. C1 costs for the project were estimated as $570M with total operating unit cash costs of $1,765/oz produced. The estimated net free cash produced is approximately $153M over an eight year production period.

The mining material included within the life of mine plan contemplated in the Study are comprised of 66% in the Measured or Indicated Mineral Resources category, and 34% classified as Inferred Mineral Resources. A summary of the mining physicals are presented in Table 1.

Click here for the full ASX Release

This article includes content from Brightstar Resources, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.