Auric Mining (ASX: AWJ) has cleared the final hurdle to securing sole mining rights down to 150m at its Munda gold project near Widgiemooltha in Western Australia, after paying $700,000 of a total $1.2 million owed to WIN Metals (ASX: WIN) for the site’s nickel and lithium rights.
The agreement grants the company at least eight years of exclusive mining rights at the Goldfields region project, with the remaining $500,000 set to be paid to WIN by April next year. Auric will now also have access to the vital in-pit water supply that will be required once mining starts.
Part of the deal also involves WIN handing across all of its mineral interests in seven other non-core exploration tenements and applications.
The lack of sole mining rights – regarded by Auric as a major hurdle for its bold plans – has now been removed, allowing it to home in on Munda’s gold potential. The company has always seen Munda as a major play within its operations and the deal means it has stepped significantly closer to turning those words into reality.
We now have greater control over our destiny for open pit gold mining at the Munda Gold Project. Securing the nickel and lithium rights from WIN Metals down to the 235m RL and having sole rights to an agreed area means we have taken another major step forward to commencing a trial pit at Munda.
Auric Mining Managing Director Mark English
The Munda project has long been planned as the next cab off the rank for the company following the completion of its two-year money-making mining operation at Jeffreys Find near Norseman. Now, it will now forge ahead with plans for a trial pit at Munda, potentially allowing it to start mining at the beginning of next year.
The deposit, 98 km south of Kalgoorlie, was spotlighted in a 2023 scoping study that detailed plans to mine between 112,000 and 129,000 ounces of gold through open-pit operations during a three to five-year period. The mined gold is expected to be processed at a local mill via third-party toll treatment.
Munda holds a total resource of 200,000 gold ounces, with recent grade-control drilling confirming grades exceeding 2 grams per tonne.
Based on a gold price of $2600 per ounce, the project is forecasted to generate $76.9 million in surplus cash. But with the current Australian gold price now sitting at about $3700 an ounce, the potential returns could be even greater.
Auric has continued to make hay while the sun has been shining at Jeffreys Find, recently reporting a further $6.3 million in gold sales from toll treating ore from the operation. That comes after it collected $4.7 million in free cash from the first year of the two-year operation.
Now, with the second 150,000-tonne milling campaign underway, the company is projecting a higher-than-expected total of $25 million in gross gold sales from Jeffreys Find this year.
This year has turned into a bonanza for Auric – first cashing in on a once unloved and largely derided Jeffreys Find and now using that cash cow to fund the start of mining at its highly-prospective Munda deposit. Of course, the company can have a lot to be thankful for considering the stellar performance of the current gold price, but it can also take some of the glory for making a slice of its own luck.
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