Perth, Dec 10, 2024 AEST (ABN Newswire) – Horizon Minerals Limited (ASX:HRZ) has reached a significant milestone in the development of the Boorara Gold Project, marking a pivotal moment in its journey towards gold production. This article delves into the key highlights of the project, the operational challenges faced, and the future outlook for Horizon Minerals.
Project Overview
The Boorara Gold Project, located just 15 kilometers east of Kalgoorlie-Boulder and adjacent to the renowned Super Pit, is set to become a vital contributor to Horizon Minerals’ portfolio. Approved for development in late July 2024, the project encompasses a series of four open pits containing approximately 1.24 million tonnes of ore with an average grade of 1.24 grams per tonne (g/t) gold, translating to an estimated 49,500 ounces of gold.
Contractual Agreements and Financial Projections
Horizon Minerals has strategically partnered with Hampton Transport Services Pty Ltd for mining services and surface ore haulage. Notably, the terms of the contract stipulate that no payments will be made to the mining contractor until the first gold pour is sold and funds are received, ensuring a risk-mitigated approach to cash flow management.
The mining operations are projected to span 14 months, with processing expected to take an additional 19 months at Norton Gold Fields’ Paddington plant. Under an Ore Sale Agreement (OSA), Horizon anticipates generating approximately $30 million in free cash flow, assuming a gold price of A$3,600 per ounce. The OSA outlines a structured payment system, where Horizon will receive 50% of gross revenue less estimated processing costs within five days of delivering ore to the Paddington ROM pad.
Progress and Challenges
Mining commenced in August 2024, initially operating on a single shift before ramping up to four digger shifts. However, the tight labor market in Western Australia posed challenges, leading to delays in the first ore delivery. Despite these hurdles, the operation is now fully staffed, and the team has made significant progress.
The first ore stockpile, comprising 54,380 tonnes, has undergone rigorous assaying and metallurgical test work. This ore is currently being transported to the Paddington mill for processing, with expectations of producing approximately 1,400 ounces of gold at a projected grade of 0.8 g/t and a recovery rate of 94%. The estimated gross revenue from this initial stockpile is around $5.78 million, after accounting for processing costs and royalties.
Leadership Insights
Mr. Grant Haywood, Managing Director and CEO of Horizon Minerals, expressed his satisfaction with the progress made thus far. He stated, “It is very pleasing that we are transporting our first ore delivery from Boorara, with first revenue due shortly. This milestone has been achieved despite the tight labor market during our ramp-up phase and some inclement weather. We are now fully manned up and the team has been making good progress. We look forward to ongoing gold production from Boorara.”
In addition to the Boorara project, Haywood highlighted the advancement of the Phillips Find project, which is on track for its first ore delivery to the Greenfields mill in February 2025.
Future Outlook
As the Boorara Gold Project continues to develop, Horizon Minerals is optimistic about the potential for increased ore grades as mining progresses. The company is committed to maintaining a sustainable development pipeline while focusing on aggressive exploration and further acquisitions.
Horizon Minerals Limited is not only focused on gold but also has joint ventures across multiple commodities, including Vanadium, Copper, Platinum Group Elements (PGE’s), and Nickel/Cobalt. This diversification strategy allows the company to leverage opportunities while concentrating on its core gold business.
Conclusion
The processing of the first ore from the Boorara Gold Project marks a significant achievement for Horizon Minerals, setting the stage for future growth and profitability. With a solid operational framework in place and a commitment to overcoming challenges, Horizon is poised to make a lasting impact in the Western Australian goldfields. As the company moves forward, stakeholders can look forward to continued updates on production and exploration efforts, solidifying Horizon’s position as a key player in the mining sector.
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