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Auric Mining
Investor Insight
Given its quick transition from ASX listing to gold production in just three years, and a significant exploration upside at its world-class assets in Western Australia's prolific goldfields, Auric Mining is well-worth a good deal of consideration for sophisticated investors.
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.
The Jeffreys Find Pit as of 16 July 2024
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 and Auric has commenced its second gold milling campaign for 2024 of 150,000 dry metric tonnes from the Jeffreys Find gold mine on 24 July 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 also announced the execution of a binding term sheet for the partial purchase of Win Metals' nickel and lithium rights within the Munda gold project area including seven tenements or applications. Auric further plans to mine a trial pit at Munda Gold potentially in Q1 2025.
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.
- Auric has commenced the second gold milling campaign for 2024 of 150,000 dry metric tonnes from the Jeffreys Find gold mine.
- The company executed a binding term for the partial purchase of Win Metals' nickel and lithium rights within the Munda Gold Project area further improving the pathway to mining a trial pit at Munda gold project, potentially in Q1 2025.
- 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.
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Western Australian gold producer, explorer and developer with world-class deposits
OPINION — Goldenomics 103: Gold Protects and Performs
By Darren Brady Nelson
US President Donald Trump’s “Liberation Day” tariffs certainly caused quite the stir in the markets on April 2.
Gold dropped about 6 percent, and silver 12 percent. A week later, a pause was announced, which ended on August 1. Gold and silver have since risen approximately 11 percent and 24 percent, respectively.
Six month gold and silver price performance.
Source: Trading Economics (gold) and (silver).
Unless you are a professional, or even amateur, trader, it is best to look at gold and silver investment with a perspective of years or decades, rather than just days, weeks or even months. Since the start of the COVID-19 panic in March 2020, gold and silver have exploded 123 percent and 192 percent.
10 year gold and silver price performance.
Source: Trading Economics (gold) and (silver).
In the shorter term, the gold price is driven by what economist John Maynard Keynes called “animal spirits.” In the longer term, it is driven by “monetary spirits.” And not just as protection, but also for performance. The Presidential Gold Guide highlights both in chapters four and five.
Source: Fisher Liberty Gold.
Gold unsurprisingly protects
Economist and investor Mark Skousen has wisely noted that: “Since we left the gold standard in 1971, both gold and silver have become superior inflation hedges.” Gold has more than countered the results of inflation, as measured by CPI, and the drivers of inflation, as measured by M3.
And the numbers back that up. The Gold Protects chart below compares the gold price, CPI and M3 in terms of cumulative growth of each from 1971 to 2025. That is throughout the whole era of gold as an investment, which officially started in 1974 once private ownership was restored.
During this era, gold grew by 541 percent, CPI by 214 percent and M3 by 384 percent. Annual average growth for gold was 10 percent, CPI at 4 percent and M3 at 7 percent. Maximums were 92 percent, 14 percent and 29 percent, respectively. CPI only failed to grow twice, ie. 0 percent in 2009 and 2015. M3 decreased twice, by -4 percent in 2023 and -6 percent in 2024.
Gold surprisingly performs
The highly respected In Gold We Trust (IGWT) report states: “When dealing with the specific level of gold allocation, it is advisable to differentiate between safe-haven gold and performance gold. The Big Long strategy emphasizes the potential of performance gold in the coming years.”
IGWT thus recommends an investment portfolio "rule of thumb" that includes 15 percent in “safe-haven gold” and 10 percent in “performance gold.” The Gold Performs chart below compares gold price, S&P 500 and nominal GDP in terms of cumulative growth of each from 1971 to 2025.
Gold grew by 541 percent, the S&P 500 by 484 percent and GDP by 339 percent. Annual average growth for gold was 10 percent, with the S&P 500 at 9 percent and GDP at 6 percent. Maximums were 92 percent, 45 percent and 14 percent, respectively. Gold did have a higher standard deviation of 27 percent, compared to 17 percent for the S&P 500 and 3 percent for GDP.
Animal and monetary spirits
Gold protects as a hedge or safe haven, not just from inflation, but from the flip side of that same coin of the boom-bust cycle. Both are driven, in the longer term, not by “animal spirits,” but by “monetary spirits.”
Inflation is when money inflation has a widespread impact as price inflation. A bubble is when money increases have a more concentrated impact such as in certain asset values. The bubble eventually bursts when “monetary spirits” are finally reined in by monetary realities.
I say “monetary spirits” because of the role of fiat money, as indicated by, say, M3. When money supply outstrips money demand in a localized way, then that is a bubble, and when in a general way, that is inflation.
The former shows up in certain asset, wholesale and/or producer prices, whilst the latter shows up in CPI. Asset prices include the S&P 500. But nominal GDP is also "ginned up" as it is ultimately a price times quantity measure as well. Price is expressed in money terms.
Conclusion
Gold can have ups and downs, as standard deviation indicates, due to the “animal spirits” of fear and uncertainty, that tend to be daily, weekly or monthly. Yet gold both protects and performs due to the “monetary spirits” of inflation and boom-bust, which tend to be decennially.
In particular, gold performs when the S&P 500 does not, like in the aftermaths of the 2001/2002 dot-com collapse, the 2008/2009 global financial crisis and 2020/2021 COVID-19 lockdowns.
Therefore, when it comes to gold, “follow the money” of central bank “money printing” and fractional reserve bank “fountain pen money,” for both superior inflation protection and boom-bust performance.
And besides, Skousen rightly "begged the question" as follows: “Gold and Silver have always had value, never gone to zero. Can you say the same for stocks and bonds?”
About Darren Brady Nelson
Darren Brady Nelson is chief economist with Fisher Liberty Gold and policy advisor to The Heartland Institute. He previously was economic advisor to Australian Senator Malcolm Roberts. He authored the Ten Principles of Regulation and Reform, and the CPI-X approach to budget cuts.
Click here to read Goldenomics 101: Follow the Money, and here to read Goldenomics 102: The Shadow Price of Gold.
