Calidus Resources has cleared its final construction hurdle on time and on budget, with commissioning now underway of its 100 per cent owned Warrawoona gold project in the Pilbara region of WA. The company says it expects crushing and milling operations to start within the next eight weeks with first gold set to be poured approximately two weeks later.
Operational preparations to date include the installation and commissioning of a nine mega watt diesel backup power station, securing a water supply from its bore fields and the completion of tailings storage facility.
The company has also installed of a semi-autogenous or “SAG” mill, with other major structural steel and mechanical installation work complete and piping and electrical projects nearing conclusion.
In addition to the construction of the fixed plant, Calidus has also secured the majority of its operational workforce, stockpiled over 100,000 tonnes of ore and had the first four 100 tonne trucks and 200 tonne excavator mobilised to site.
A 2020 feasibility study at Warrawoona showed an estimated production rate of 90,000 ounces per annum with a life of mine all in sustaining cost hovering around the $1,290 mark over an initial eight-year period and producing up to 105,000 ounces of gold annually.
The study projected a post-tax payback period of only 15 months for a $120 million capital outlay, based on a gold price of $2,355 an ounce.
EBITDA was forecast to average $92 million a year with an after-tax net present value calculated at $245m, with an impressive internal rate of return of 57 per cent.
Calidus is also delivering on its environmental initiatives with its recent installation of a solar farm and battery storage system to help power the Warrawoona project. The solar farm is a huge step towards achieving the company’s carbon reduction plan according to the company.
Calidus Resources’ Managing Director David Reeves said: “The start of commissioning was a major milestone for the Company.”
“With first gold now forecast to be less than ten weeks away, we are about to make the pivotal transition from developer to profitable gold producer.”
Warrawoona looks to be on the home stretch towards jolting its flagship operation into life with the successful explorer now tantalisingly close to becoming Australia’s newest addition to the mid-tier gold mining club.
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