Ausgold (AUC) Site Visit Katanning Gold Project
Shares on issue (current): 1,959m
Option and rights: 56m
Cash: A$12m
EV: A$119m
- We visited Ausgold’s (AUC) Katanning Gold Project, located 275km south-east Perth and 40km from the wheatbelt town of Katanning (WA).
- AUC is a gold explorer, having built a large ground position within the Katanning Greenstone, an under-explored but highly prospective gold belt.
- The Company is building criterial mass for future gold development opportunity, resource base 1.84Moz @ 1.24g/t Au with 1.2Moz (65%) in M+Ind.
- Recently completed drilling will further upgrade resources with potential for some growth and grade improvements in some zones – next resource update due this month (late April’22).
- Importantly higher confidence resources bodes well for a maiden reserve, due in the PFS late June’22.
- The standalone gold operation has scale potential of +3Mpta which implies +100kozpa, but with further resource growth could be provide scale opportunities to 4Mtpa for +130kozpa.
- Initial open pit operation, vast majority of ounces in the Central Zone with potential upside to come from the Southern Zone.
- Good metallurgy with all free-milling ores, high gravity recoveries (+40%) and conventional leaching for total recoveries of +88-94% (using a 75μm grind), optimisation work now underway.
- Following the PFS release, AUC is expected to progress environmental studies and approvals with the DFS at this stage flagged for 1HCY23.
- AUC is considered a “whole of belt exploration play” with the Northern, Central and Southern Zones covering a mineralised trend of 17km, core resource area over 4.5km and numerous satellite opportunities to add mine life and sustain potential higher production levels.
- We like the near-term catalysts – resource update, PFS, ongoing resource definition drilling and regional exploration (new discoveries).
- No formal coverage.
