Meeka Metals (ASX: MEK) has appointed top-gun mine site executive Matthew O’Hara to lead the construction phase for its 100 per cent-owned flagship Murchison gold project in Western Australia’s Mid West region.
The company has today confirmed that funding is imminent, site environmental permits have been secured and a bigger-than-planned ball mill will be delivered by September, bringing the project another step closer to production.
O’Hara, who will next week begin his new role as the project’s senior site executive, has extensive experience in the WA gold mining sector. Most recently he developed the Penny gold mine for Ramelius Resources and held senior roles at Sunrise Dam for AngloGold Ashanti and Mount Monger for Silver Lake Resources.
Meeka is moving apace to ensure first production within the next 12 months at the Murchison play. Importantly, management says final credit-approved documentation for the bigger portion of the project development funding is expected to be completed within the next two weeks.
That will allow the company to progress ongoing site works including the laying of permanent services, infrastructure and haul roads, together with moving the 200-man camp and administration infrastructure from Sandfire Resources’ DeGrussa operation to site. Completion of site works is expected before the end of the calendar year.
It is a significant achievement to secure highly-regarded mine builder and operator, Matthew O’Hara, to the team to lead the Murchison through development and into production. Having worked with Matt at Silver Lake, I have first-hand experience of his ability to execute and it is great to have him onboard.
Meeka Metals Managing Director Tim Davidson
Davidson said he expected the mobilisation of infrastructure and equipment to the Murchison site to accelerate in the coming weeks, with the implementation of the bigger project development credit facility.
The company says the plant is also steadily progressing. A bigger-than-anticipated 750kW ball mill will land at site next month after the company managed to nab a recent bargain at auction, paying $318,000 for the Outokumpu equipment. The fortuitous purchase has saved Meeka 75 per cent of its definitive feasibility study (DFS) capex and allows it to lift processing capacity by 30 per cent to 640,000 tonnes per annum, which in turn increases its ore processing options.
Concurrent with all the on-site activity, the company is working hard on an updated DFS to be ready before the end of the December quarter and it is expected to re-optimise the production plan for the increased processing capacity. The current DFS had forecast an already impressive undiscounted pre-tax free cash flow of $577 million and an internal rate of return (IRR) of 127 per cent at $3500 per gold ounce.
Today’s Australian gold price hovered around the lofty $3780 per ounce mark.
Meeka is clearly focused on making its own luck, with the hiring of a top mine site executive, the bargain-basement purchase of a bigger ball mill and a gold price running riot to all-time highs. And so far, it would appear that the earned luck will continue to work in the company’s favour as it rapidly moves toward first pour.
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