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Auric Mining (ASX: AWJ) is a “compelling investment case” poised for significant growth driven by the potential of its two flagship projects, Jeffreys Find and Munda Gold, Sydney, Australia-based investment management and corporate advisory firm Canary Capital wrote in a new equity research report.
“AWJ is our preferred ASX-listed company to participate in the current favourable macro environment for gold,” said the report prepared by Paul Hart and Arun Sengupta, both directors at Canary Capital.
The report noted the remarkable progress made by AWJ - transitioning from tenement acquisition and ASX listing to mining and cash flow generation in just under three years - earning $4.77 million in cash from Stage One of the Jeffreys Find gold mining project. More than 9,741 ounces of gold have been mined and sold from Jeffreys Find to date.
A picture of the Jeffreys Find ore body showing gold mineralisation location evidenced by darker zones
AWJ has also completed a scoping study for the Munda gold project, showing exceptional economics and a path to cash flow generation of approximately $77 million.
“Despite the significant cash flow potential of the company’s projects, the current market capitalisation is just $20.3m. We view this as presenting investors with an opportunity to invest in AWJ at a fraction of the real intrinsic value of the company,” the report said.
Highlights of the report:
- AWJ has made remarkable progress in a span of just under three years since its ASX listing and the acquisitions of assets.
- Cash generated from Stage One production at Jeffreys Find, which totals $4.8 million, will fully fund AWJ in 2024 as it develops Stage Two production, which is expected to generate between $6 million and $8 million for the company.
- Munda’s exceptional economics, with a projected positive cash flow of $76.9 million over a 13-quarter mine life based on a conservative gold price assumption of A$2,600/ounce.
- Munda will commence operations with a three-month starter pit and a low capital investment of $1.3 million and a working capital investment of approximately $6.0 million.
- Munda is projected to generate around $8.7 million in surplus cash for AWJ, depending on the results from the current drill program.
Read the full analyst report here.
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Auric Mining
Overview
Auric Mining Limited (ASX:AWJ) is a gold exploration and mining company based in Western Australia. In three-and-a-half years since its ASX listing, Auric has become a gold producer in this premier jurisdiction.
Since incorporation, it has moved from zero to 250,000 ounces of gold resources and zero to 282 square kilometers of tenements. Auric Mining is in the company of some of the biggest gold projects in the Goldfields, including the St Ives Gold Mine, Karora Resources’ Higginsville Operations & Beta Hunt Mine, all multi-million-ounce mines.
Besides gold, there are numerous precious metals being mined in the area with world-class deposits of nickel, lithium and rare earths. Auric is gold-focused and has the potential to become a significant producer in the region.
First blasting at Jeffreys Find took place in May 2023. Over the ensuing six months, 9,741 ounces of gold were produced.
Partnering with Auric in its Jeffreys Find Project is BML Ventures of Kalgoorlie (BML), a well-known and adept Kalgoorlie contractor. BML is a specialist mining contractor. It has particular expertise in shallow, open-pit mining with short duration projects in The Goldfields.
The Jeffreys Find Project commenced in May 2023 and is due for completion in the first quarter of 2025. The joint venture is partially exploiting 47,000 ounces of gold resources.
Gold ore on the ROM Pad at Jeffreys Find, Norseman. Ore was hauled to Coolgardie for milling in 2023.
Stage One is now complete with Stage Two mining to start in March 2024.
Success for Auric at Jeffreys Find means the company is self-funding for 2024 and able to sustain its exploration and development activity without need for additional capital raising. Auric now has a road map for five years of continuous mining and profits.
Grade control drilling at Munda was completed in January 2024
Auric’s primary focus continues to be on the company’s flagship asset - The Munda Gold Project.
To date almost 200,000 ounces of gold resources have been identified at Munda, the asset being part of the wider Widgiemooltha Gold Project, encompassing 22 tenements.
Munda is one of the largest deposits in the Widgiemooltha area having the potential to become a significant gold project.
In mid-year 2023 the Company released to the ASX a third-party scoping study on the economics and potential of open-pit mining at Munda.
The scoping study estimates the mining of up to 120,000 ounces of gold over a three-year mine life. It is envisaged gold ore would be toll-processed at a nearby Coolgardie Mill. The study projects free cash profits of between $50 million and $100 million, based on various gold prices.
Production from Munda could commence in the fourth quarter of 2024.
Auric is also planning to progress its Spargoville Project, where it has tenements ideally positioned along strike from the Wattle Dam gold mine, a prolific mine which produced 268,000 ounces of gold at 10 g/t, between 2006 and 2013.
An experienced and savvy management team leads Auric Mining towards its vision of becoming a significant gold producer in Western Australia. With the three directors owning approximately 17 percent of the company, they are focused and motivated for success.
Auric Mining’s board of directors: Mark English, Managing Director; Steve Morris, Chair; and John Utley, Technical Director
Steve Morris, non-executive chairman, has more than 25 years of experience in financial and natural resources markets.
Mark English, managing director, has a 40-year career as a chartered accountant and is at ease with all facets of running a public company on the ASX including major equity and debt raisings.
John Utley, technical director, has 35 years of experience in gold exploration and development.
This range of expertise offers a high level of confidence that the company will achieve its goals.
Company Highlights
- Auric Mining is a publicly listed company with a market cap of around $13m.
- Its flagship asset is the 200,000-ounce Munda Gold Project at Widgiemooltha, just 100 kms from Kalgoorlie. It has an aim to begin production in 2024 before more intensive mining from 2025 onwards.
- During 2023 the focus was on mining at its Jeffreys Find Gold Mine, near Norseman. Stage One mining between May and November 2023 produced 9,741 ounces of gold, creating almost $30 million in gross revenue.
- A final reconciliation saw surplus cash of $9.5 million generated. Auric banked $4.78 million, being 50% of the surplus cash as agreed with its JV partner, BML Ventures of Kalgoorlie.
- Mining at Jeffreys Find will recommence in March 2024 with expectations of expanded mining activity and significantly greater tonnage to be processed compared to 2023.
- As an explorer, Auric has accumulated 282 square kilometers of tenure as it looks to find and mine a million ounces of gold between Kalgoorlie and Norseman.
- The area hosts some of the richest mineral deposits and mines in the world. In addition to gold, Auric also has opportunities for discovery of lithium, rare earths and nickel.
- Auric has three main projects: The Munda Gold Project which is part of the Widgiemooltha Gold Project; Jeffreys Find Gold Mine; The Spargoville Project.
- The company has a board and leadership team with a track record of delivering success for shareholders, particularly in discovering and bringing to production gold projects.
Auric’s tenements are between Norseman and Kambalda in Western Australia.
Key Projects
Widgiemooltha Gold Project & Munda Gold Project
Progression to open-pit mining is gathering momentum with a plan to commence gold production via a starter pit in the last quarter of 2024 at the Munda Gold Project.
The Widgiemooltha Gold Project combines 22 tenements of highly prospective gold country near Widgiemooltha and includes the Munda Gold Project. Since acquiring the Munda tenements, drilling results confirm indicated and inferred gold resources of almost 200,000 ounces (4.48 mt @ 1.38 g/t with 0.5 g cut off).
The Widgiemooltha tenements have substantial coverage at the north end of the Widgiemooltha Dome.
Even with the extensive mining history in the area, considerable exploration prospectivity remains. Several significant gold projects discovered or developed in the past ten years, including:
Auric Mining is now fast-tracking development at Munda. With a number of gold processing mills in the vicinity, the move to production is now gathering momentum.
In mid-2023 a Scoping Study on Munda produced a positive result. The study proposed a shallow open gold mine. At gold prices from $2,400/oz to $2,800/oz, the Production Target for the Project ranges from approximately:
- 1.67Mt at 2.2g/t producing 112.0koz gold, to
- 2.18Mt at 1.9g/t producing 129.1koz gold.
The Production Target generates an undiscounted accumulated cash surplus after payment of all working capital costs, but excluding pre-mining capital requirements, of between approximately $54.7m to $101.4m.
Mining is contemplated over an approximately 3-year period (13 calendar quarters).
Pre-mining capital and start-up costs are estimated to be approximately $0.8m to $1.7m.
Working capital requirements of approximately $3.9m to $8.1m were estimated based on a Stage 1 starter pit design.
Grade Control Program results at Munda.
To further advance the Project Auric completed a grade control drilling program at Munda in January 2024. In total 351 holes were sunk on a 10m x 10m grid over a potential starter pit.
Assay results include numerous significant intercepts at a 0.5g/t cut-off with high grade or broad intercepts such as:
Analysis of samples will be complete by the end of the first quarter 2024.
Further grade control drilling is envisaged as the company hones in on this high grade deposit.
A starter pit lasting about three months is envisaged in the last quarter of 2024. More intensive mining would follow in the period 2025-2027.
In all, Munda is projected to be a short-life project, able to produce exceptional cash profits with a gold price continuing at above $3000 an ounce.
Jeffreys Find Gold Mine
Fresh from mining almost 10,000 ounces of gold in 2023, Jeffreys Find’s Stage Two is certain to be significantly greater in scope.
The Jeffreys Find Gold Mine is located approximately 45 kilometers northeast of the town of Norseman and 12 kilometers off the main Eyre Highway via a haul road.
Jeffreys Find is a short-life mine with a total gold-resources estimate of nearly 50,000 ounces.
Magnetic image of the gold resource at Jeffreys Find
The company has performed remarkably well with this mine, having acquired the tenements just 3.5 years ago.
Stage One mining took place over six months, from May to November 2023 with about 175,000 tonnes of gold ore hauled to the Greenfelds Mill at Coolgardie where it was processed. Final refining and sale of gold bullion produced took place at the Perth Mint.
Stage One – Production & Revenue Statistics
The project is a joint venture undertaking between Auric and well-known Kalgoorlie contractor BML Ventures Pty Ltd (BML).
Auric’s risk is mitigated by BML who assume all operating costs including mining and haulage. Gold processing costs are recovered from the sale of gold bullion. After all costs have been deducted surplus cash is split equally between the partners.
For final mining in 2024 Auric has contributed $1 million in cash towards working capital which will be repaid towards the end of the final phase of mining.
The final pit shell at Jeffreys Find Gold Mine will be premised on a gold price of $2,900 an ounce, compared to the Stage One pit which was designed on the basis of gold at $2,600 an ounce. As a result the tonnage of ore being hauled to the mill will be substantially higher in 2024.
Equipment is being mobilised to the mine site in February and mining will recommence in March 2024. A continuing higher gold price has placed the joint venture in a solid position to throw off surplus cash well in excess of what was achieved in 2023.
Auric’s MD Mark English, Chairman Steve Morris and Technical Director John Utley at the Perth Mint with Auric gold bars from its Jeffreys Find Gold Mine.
Spargoville Project
Highly prospective tenements as company looks for gold on strike to Wattle Dam
Located approximately 35 kilometers southwest of the mining town Kambalda, the Spargoville Project is an underexplored asset with partially tested or entirely untested gold, nickel and lithium anomalies.
The asset sits north of the Wattle Dam gold mine. The Wattle Dam gold mine produced 268,000 oz of gold at an average grade of 10 g/t between 2006 and 2013.
While only partially drilled, initial exploration results from the Fugitive Prospect include an intercept at 14 meters with a grade of 2.51 g/t gold, indicating the asset’s promising potential.
Auric’s tenements at The Spargoville Project.
Management Team
Auric Mining’s Management and Board of Directors have a wealth of experience in gold discovery, in mine operations and across the full spectrum of finance and administration. That experience stretches to all parts of the globe.
Board of Directors
Steven Morris – Non-executive Chairman
Steve Morris is a well-known financial markets executive with more than two decades experience at a senior level. He garnered industry respect as head of private clients for Patersons Securities, now Canaccord Genuity, and has also been managing director of Intersuisse. Mr. Morris has served as a senior executive of the Little Group. From 2014 to 2019, Morris was a non-executive director of De Grey Mining (ASX:DEG), a gold company now with a $2.4 billion market capitalization. Mr. Morris is well connected in finance circles and was a board member of The Melbourne Football Club for nine years including three years as the vice chairman.
Mark English – Managing Director
Mark English is a Chartered Accountant with more than 40 years’ experience in business. English was the founding director of Bullion Minerals Ltd, now DevEX Resources (ASX:DEV) a company he managed for seven years before taking it to an IPO. Mr. English has considerable experience with major equity and debt raisings. He currently sits on the Board of WA integrated agricultural company Moora Citrus Group, one of the nation’s largest citrus producers and processors.
John Utley – Technical Director
John Utley has a 35-year career in mining and exploration with a dominant focus on gold assets. He holds a master’s degree in Earth sciences from the University of Waikato in New Zealand. Mr Utley has worked in Australia, South America, Papua New Guinea and most recently in Canada where he was the Chief Geologist for Atlantic Gold Corporation, a company now owned by St Barbara (ASX:SBM). He spearheaded exploration and development of the Touquoy Gold Mine in Nova Scotia, Canada, prior to being acquired by St Barbara. Mr Utley previously worked with Plutonic Resources (ASX:PLU) and was head of the exploration team at the Darlot Gold Mine during the discovery and development of the 2.3-million-ounce Centenary gold deposit.
Auric to Bank $3M Cash this Quarter. Toll Milling of 150,000 Tonnes to Start in 3 Weeks.
Highlights
- First cash of $2 million to be received in Q3, 2024 from gold sales.
- Repayment of $1 million working capital in Q3, 2024.
- Milling notice signed to toll treat 150,000 tonnes of ore.
- Processing to commence 24 July 2024 with campaign to last 6-7 weeks.
- 75,000+ tonnes already delivered to Greenfields Mill or on ROM Pad at mine.
- Further toll milling campaigns scheduled in Q4, 2024.
- JV on target to process 300,000 tonnes at Greenfields Mill in 2024/2025.
Management Comment
Managing Director, Mark English, said:“We’ll bank $2 million this quarter, first proceeds to Auric from the 2024 mining of Jeffreys Find. It’s an early payment from our JV partners, reinforcing to us that we’re in for a great year at Auric.
“With another $1 million coming back from our earlier working capital contribution to Stage 2 at Jeffreys Find, we find ourselves in a robust position.
“The Coolgardie mill has now agreed with BML that it will toll treat 150,000 tonnes of gold ore starting 24 July 2024. This second gold campaign of the year is expected to generate in excess of $20 million in gross revenue for the joint venture, setting the stage for ongoing cash distributions to Auric.
“BML has a contract with the mill to process 300,000 tonnes in 2024, but it will extract considerably more tonnes than that. Discussions are underway as to where this excess tonnage will be toll milled.
“We are exceeding our targets and with the gold price holding around $AUD3,500 an ounce the timing is perfect. Jeffreys Find will be a substantial cash producer for Auric in 2024 and 2025,” said Mr English.
The Jeffreys Find Pit. Photo: 1 July 2024
As of 3 July 2024 a total of 43,402 tonnes of ore has been transported to the Greenfields Mill (Greenfields) at Coolgardie by BML Ventures Pty Ltd of Kalgoorlie (BML), Auric’s joint venture partner.
BML is mining around the clock with an estimated 30,000+ tonnes of high grade ore on the ROM Pad at Jeffreys Find, awaiting transport to Greenfields.
Greenfields and BML have executed a toll milling notice to process 150,000 dry metric tonnes of ore. Milling will take place across approximately six to seven weeks, commencing 24 July 2024 and concluding in early September 2024.
BML is planning on mining more than 300,000 tonnes of ore during Stages 2 and 3 of the Project in 2024 with further gold milling campaigns scheduled later in 2024 and early 2025.
Auric has also received notification from BML that it will receive $2 million in cash, being the first distribution of surplus cash for Stage 2 of the Project, this quarter.
In addition BML has advised it will repay $1 million to Auric this quarter, working capital AWJ had advanced to the JV for the commencement of Stage 2 mining at Jeffreys Find.
Click here for the full ASX Release
This article includes content from Auric Mining, 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.
Unconformity Uranium Drill Targets Identified from 2024 Geophysical Data
Key Highlights
- Final data received and interpretation completed for the ground electromagnetic geophysical surveys from the winter 2024 program at the Marshall and North Millennium projects.
- Several conductive anomalies identified at Marshall, located above and below the unconformity, consistent with regional exploration model.
- Stacked anomalies concurrently with multigenerational geophysical data provides a base to assess the exploration targets and refine drillhole targets.
- The projects are located 15 kilometres from the majority Cameco owned Millennium deposit, and just 40km from the world class McArthur River mine.
- Basin remains funded for the next round of field exploration.
The ground electromagnetic successfully identified 3 main targets which confirms the geological and exploration model. Of note is Target 1 (Figure 1), where modelled EM plates below the unconformity align with a sandstone ZTEM anomaly, which is interpreted to be alteration within sandstone. The identification of these targets is encouraging and consistent with regional trends in the southeastern Athabasca and provides increased confidence in drill hole targeting. Basin is currently reviewing options and priorities of how to progress exploration of these confirmed targets.
Basin’s Managing Director, Pete Moorhouse, commented:
“Conducting ground geophysical surveys on Marshall and North Millennium was a milestone in advancing these underexplored projects in Basin’s uranium portfolio. The form of these anomalies is highly encouraging given the proximity to some of the world’s largest uranium deposits.”
Key results
Following the encouraging conductive anomalism highlighted by the 2023 3D inversion of two historic airborne Electromagnetics (Z‐Tipper Axis) (“ZTEM”) datasets partially covering the current North Millennium and Marshall projects3,4, Basin contracted Discovery International Geophysics5 to carry out ground Stepwise Moving Loop Transient Electromagnetic (‘Ground EM’) surveys on areas of immediate interest within the Projects.
Figure 1 Three main anomalies shown from 2024 ground EM, in plan view (top diagrams) and cross- section looking northeast (bottom diagram). The ground EM anomalies are displayed with the modelled plates against the historical ZTEM data.
The 2024 Ground EM survey data returned six conductive anomaly picks producing three main target areas (Figure 1). The anomalies correlate strongly with the southern edge of the circular ZTEM conductive anomaly at Marshall and the interpreted northern edge of the circular anomaly identified in the historic data. A weaker EM pick was also interpreted centred between the two prominent ZTEM conductivity anomalies.
Three-dimensional modelling using Maxwell produced six electromagnetic conductive plates within the basement stratigraphy, all below the unconformity (Figure 1). The two southeastern plates are clearly aligning with a conductive sandstone ZTEM anomaly identified from the historic data, which is above the interpreted unconformity. This is interpreted as potential basal sandstone alteration proximal to the EM anomalies and constitutes a high-priority drill target area, refer figure 2.
Click here for the full ASX Release
This article includes content from Basin Energy, 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.
Airborne EM over Multiple Targets on Ti-Tree Project
- Augustus Minerals has contracted UTS Geophysics to conduct a VTEM Max survey over several Copper, Cu-Ni-PGE, Zn-Pb-Ag and Uranium targets along the money Intrusion and within proximity of the prospective 85k long Ti-Tree Shear.
- The surveys will cover:
- The Money Intrusion, prospective for Cu-Ni-PGE mineralisation.
- Copper Ridge and Nics Bore over anomalous Copper Drilling results
- The Coo Creek prospect where drilling by Augustus in 2023 identified strongly anomalous Zn-Pb-Ag mineralisation.
- The Munaballya Well North area which shows potential for economic Uranium mineralisation.
- The surveys will help to advance the untapped potential of the Ti-Tree project to host economic mineralisation of multiple commodities.
Andrew Ford, GM Exploration
“The VTEM survey will provide key targeting data over three highly prospective and different prospects with potential for multiple commodities. Whilst the high prospectivity for copper mineralisation has been well documented, the addition of uranium and Broken Hill base metal style mineralisation highlights the quality of the underexplored Ti-Tree project”.
VTEM
UTS Geophysics has been engaged to conduct a helicopter borne VTEM Max survey comprising 646-line km over three separate survey areas. The system is excellent for locating discrete conductive anomalies as well as mapping lateral and vertical variations in resistivity which helps map structure, alteration and rock type. The system also collects magnetic data through a caesium magnetometer. The transmitter/receiver loop is suspended on a cable approximately 40m below the helicopter (Figure 1).
Figure 1 VTEM Max helicopter deployed electromagnetic survey arrangement.
Figure 2 Prospects and VTEM Survey areas.
Money Intrusion
The Money Intrusion, which has proven potential to host Ni-Cu-Co-PGE (platinum group elements), is part of the regional Mundine Well Dolerite Suite, a regionally extensive dolerite (strike length >80km). This extensive mafic intrusion, which is comprised of a variety of lithologies, including gabbro in the core, olivine dolerite on the chilled lower contact or keel and fine-grained dolerite on the outer edges. Mapping, aeromagnetics and multi-spectral imagery show that the Money Intrusion within the Ti-Tree Project covers a strike length greater than 16km, reaching widths >600m in the north of E09/23241.
Click here for the full ASX Release
This article includes content from Augustus Minerals, 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.
Auric Mining Investor Kit
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- Insights
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- Upcoming projects