Native Mineral Resources Boosts Gold Production Plans in Queensland
NMR (NMR) Share Update November 2024 Monday 25th
NMR Accelerates Gold Production Plans in Queensland
Native Mineral Resources Holdings Limited (ASX: NMR) has announced an accelerated plan to resume gold production at its newly acquired BlackJack and Far Fanning gold deposits in Queensland, aiming to become a leading gold producer by late 2025.
Instant Summary:
- Acquisition of BlackJack and Far Fanning deposits for $18.9 million.
- BlackJack processing plant refurbishment planned for late 2025 production.
- Drilling at Far Fanning to upgrade 138,000oz gold resource.
- Engagement of Ausenco for plant refurbishment and testing.
- Capital expenditure estimated at $5M-$5.5M for plant upgrades.
Project Acquisition and Goals
Native Mineral Resources (NMR) has recently acquired the BlackJack and Far Fanning gold deposits, along with the BlackJack processing plant, for $18.9 million. This strategic acquisition is expected to fast-track NMR's gold production capabilities in Queensland, with a target to begin production by the end of 2025.
The company plans to leverage the advanced status of these projects to transform into a leading gold producer. NMR's Managing Director, Blake Cannavo, emphasized the importance of these acquisitions in achieving the company's production goals.
Drilling and Resource Upgrade
NMR is set to commence a diamond drilling program at the Far Fanning deposit, aiming to upgrade the current Inferred Mineral Resource Estimate (MRE) of 2.3 million tonnes at 1.84g/t gold for 138,000 ounces. The drilling is expected to improve the resource classification to Indicated status, providing a more reliable estimate of the deposit's potential.
Sampling of stockpiles at Far Fanning has already yielded promising results, with 45 samples returning grades above 0.5g/t gold. This ongoing sampling program will continue alongside the drilling efforts.
BlackJack Processing Plant Refurbishment
The BlackJack processing plant is in better condition than initially anticipated, and NMR has engaged Ausenco and specialized contractors to oversee its refurbishment. The plant's refurbishment is projected to cost between $5 million and $5.5 million, with upgrades focusing on the elution circuit, gold room, and control systems.
Refurbishment will proceed in phases, starting with scoping and pre-commissioning, followed by mobilization and vendor engagement in early 2025. The core refurbishment is expected to take five months, with a commissioning period to follow.
The accelerated gold production plans could significantly enhance NMR's market position and stock value. The refurbishment of the BlackJack plant and the resource upgrade at Far Fanning are likely to boost investor confidence, potentially leading to a positive market reaction.
Investor Reaction:
Analysts are optimistic about NMR's accelerated production plans, noting the potential for increased gold output and improved resource estimates. However, they also caution about the execution risks associated with the refurbishment and drilling programs.
Conclusion:
Investors should keep an eye on NMR's progress in refurbishing the BlackJack plant and upgrading the Far Fanning resource. These developments could offer significant growth opportunities for the company and its shareholders.