As the 136-man camp and haulage road nears completion, the infrastructure roll out at Meeka Metals’ (ASX: MEK) Murchison gold project 50km north of Meekatharra in Western Australia is running ahead of schedule with the company chasing a first gold pour by the middle of next year.
With 88 of the 136 accommodation rooms now fully commissioned, Meeka has importantly, created the opportunity to save some valuable time by ensuring space for the expanding workforce on-site.
The construction of a 20km haul road connecting the open pit mining area to the processing plant is rapidly progressing, ahead of schedule and now expected to be completed in January enabling efficient material movement and improving operational workflows.
A key piece of equipment, the enlarged 750kW ball mill, which was bought at auction for a bargain $318,000 has now also arrived and is ready for installation by MACA Interquip Mintrex (MIQM) which has already finalised the design work for mill foundations and extra tank installations.
MIQM installers have now also moved to site to kick off the upgrade of the carbon in leach processing plant. Structural components, such as additional leach tanks should be fabricated by early November while the site’s processing workshop and warehouse have been cleared and prepped for incoming maintenance equipment and essential spares.
On the mining front, development drilling has started at the Turnberry site, focusing on expanding high-grade underground resources with a 7,500-metre campaign with initial assay results expected by December. Additionally, a 15,000-metre drilling program for final grade control in the shallow oxide pits is ongoing to optimise the mine plan and prepare for open-pit mining.
The company is currently in the tender phase for the open-pit mining contract, which it expects to finalise in late November.
The first priority will be to re-access the Andy well underground operations and re-establish services. Open pit mining activities are then scheduled to begin in March next year in the buildup to ore processing due to start in June with first pour expected a month later.
As a result of being able to acquire a bigger ball mill, Meeka has been working on at updated mining schedule and optimised pit-shell which should be handed down in a new definitive feasibility study (DFS) shortly.
The plan is now expected to provide for the processing of a 600,000-tonne, 2 grams per tonne gold stockpile more quickly and give the project an early revenue kicker. Added to that, the upgrade will allow management to access and process an extra 52,000 ounces of gold from the newly optimised pit and 61,000 ounces of 3.3g/t gold ore that is easily accessible in the existing underground mine.
Importantly, as the ability to accommodate our workforce increases with progressive commissioning of the accommodation village we are able to expand the contractor presence on site. MIQM arrived in October and immediately set to work on the process plant upgrade, affirming the target of first gold in mid-2025.
Meeka Metals Managing Director Tim Davidson
The Murchison gold project covers 281 square kilometres and hosts 1.2 million ounces of high-grade gold running at 3g/t. The earlier DFS set out plans to restart the processing plant and mining with solid financials on the back of a conservative AU$3250 gold price. The reported numbers included a net cash flow of $413 million, a net present value (NPV) of $244 million using an 8 per cent discount rate and an internal rate of return (IRR) of 100 per cent across a nine-year production plan.
However, with the current gold price now $1000 higher at an eye-watering AU$4240 and with production of 64,000 ounces a year, the company has forecast that the project will churn out an additional $37 million in pre-tax cash flow for every $100 above its DFS assumed price.
Timing is everything in mining and even more so in the volatile world of gold production. But given the rampant gold price right now, it is little surprise then that Meeka is pulling out all the stops to get its project up and running as quickly as possible. 2025 is shaping up to perhaps be a breakout year for the soon to be gold producer.
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