Ora Banda Mining has made a solid start to the financial year with gold production rising 39 per cent to 16,952 ounces and sold gold increasing by 35 per cent to 16,319 ounces compared to the previous quarter.
The company finished the September quarter with a healthy bank balance of $22.7 million, despite spending $11.2 million on the development of its Riverina underground gold mine and $2.8 million on exploration.
The quarterly results follow a strong finish to the previous financial year after mining a record 16,700 gold ounces at its Missouri open-pit mine in the June quarter – a 49 per cent increase from the previous period.
Ora Banda says it also increased the head grade of ore processed at its Davyhurst processing operation by 22 per cent, up to 2 grams per tonne following improvements in the crushing and milling circuit. The work lifted its fresh rock capacity to between 80 and 100 per cent of feed compared to 66 per cent during the past financial year.
While the all-in sustaining cost (AISC) of production rose for the quarter to $2953 per ounce, management believes costs from open-pit mining are expected to reduce, with its strip ratio forecast to decrease to 4.9 from the December quarter onwards, compared to 7.9 for the September period. The company also expects that an increase in forecast ounce production will lead to a substantial positive impact on unit costs going forward.
Ora Banda also settled a $10 million deal to sell its non-core Lady Ida tenements, 65km south of Kalgoorlie, in a move designed to sharpen the company’s focus on high-grade underground gold deposits.
The $2.8 million the company spent on exploration includes a diamond drilling campaign at Riverina, which significantly extended the deposit to the south and at depth and well beyond the current underground mineral resource boundary. The drill program also included Missouri and Sand King to target the underground potential within its current mining areas.
Ora Banda Mining managing director Luke Creagh said: “Going forward, we are excited to be fast approaching further catalysts to value, with open pit costs reducing, mined ounces increasing and the plant receiving a crushing circuit upgrade. This coupled with the Riverina Underground advancing on schedule to higher grade ore and further exploration drilling at Siberia means there is a lot for shareholders to look forward to."
Ora Banda previously outlined a 2024 financial year production guidance of 67,000 to 73,000 gold ounces at an AISC of between $2200 and $2400 per ounce.
Last year, management outlined a strategic reset after a detailed review of its flagship Davyhurst mining and processing operations, which sit about 120km north-west of Kalgoorlie in Western Australia’s famed Goldfields region. Part of the new strategy includes developing the Riverina underground complex based on the existing infrastructure in the area. Ore from Riverina has been processed at Davyhurst, with recoveries of about 92 per cent.
Ora Banda appears to have moved a sizeable chunk of its operational spend out of the way early in the year with its Riverina expansion and a significant exploration program. Hopefully, it will lead to a reduction in its AISC as it continues towards its goal of producing 100,000 gold ounces per annum by 2025.
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By Michael Philipps
