AUC to deliver Katanning DFS by end June 2025
DFS for proposed 3.6Mtpa development with a 10-year mine life nearing completion
Decision to mine could come as early as Q1 or Q2 2026
Pegging large tracts of ground around promising projects is common enough in the mining world, but having a junior company lock down what's essentially an entire greenstone belt is far less common.
Yet that's exactly what Ausgold (ASX:AUC) has managed to achieve with its Katanning gold project in Western Australia's Great Southern, where it has secured a landholding of over 3500km2 that is just 30km from the town of Katanning and some 275km southeast (and 3.5hrs via the Albany Highway) from Perth.
This is primarily on freehold land – requiring the company to engage with landholders rather than deal with native title agreements, and includes mineralised trends that strike over 100km.
This achievement was made possible by the relatively recent recognition by the Geological Survey of Western Australia in 2019 that what was previously considered to be just granite was actually a greenstone belt.
Greenstone belts are much sought after for explorers due to their well-known gold prospectivity.
Executive chairman John Dorward, who took the helm about a year ago as Ausgold brought in fresh blood with experience in operations and project development, told Stockhead the late identification of the project area as a greenstone enabled the company to really 'put its foot' on the entire belt.
'All of the ground that is of interest we have under tenure,' he added.
Katanning gold project map. Pic: Ausgold
Katanning gold project
That greenstone was indeed fertile. Ausgold has defined one of the largest undeveloped resources in WA of 3.04Moz of gold at an average grade of 1.06g/t.
Further highlighting the level of work already conducted, this includes higher confidence measured and indicated resources totalling over 2.42Moz and an ore reserve of 1.28Moz at 1.25g/t.
That is enough for a plant with proposed throughput of 3.6 million tonnes per annum to comfortably sustain production of some 136,000oz of gold per annum for an initial 10-year mine life.
Katanning is certainly attractive enough for Ausgold to be able to attract primarily northern hemisphere institutions to back a $38m placement last year to fast track its development.
This includes the key definitive feasibility study which the company is putting the finishing touches on. It's due for release before the end of the month.
'It's starting to look really good, taking shape. I think it's going be a really strong project,' he added.
He also noted the feasibility study is a big step towards putting a milestone out in the public domain and that not missing it would be a critical step on the right path for the company, contrasting with when it previously struggled to advance projects in a timely fashion.
That gold prices are still trading at near record levels – A$5212/oz on Wednesday – is certainly helping, though Dorward said Katanning will be very competitive against other developments even at conservative price assumptions.
Katanning gold project deposits. Pic: Ausgold
Only the beginning
The current Katanning project is a starter kit for Ausgold believes will be a multi-decade asset. The company's enormous land holding means there is plenty of the greenstone belt still to explore for large new gold deposits.
'We have started to actively explore that. We have enough to build a very attractive project. today, but we think it's just the early innings and very much just the starter for what we think will ultimately be there,' he said.
Immediate growth could come through drilling to the north and south of existing resources as it remains open in those directions.
There is also potential for repeat structures in the immediate vicinity of the project and opportunities for high-grade satellite feeders to be found across the company's regional exploration package.
A major ~19,000m drill program is currently underway including 12,000m of RC drilling proximal to the KGP designed to de-risk the first 18 months of production and grow the mineral resource.
The infill drilling has already delivered near-surface gold intercepts such as 14m grading 4.58g/t gold from 29m in the Central Zone that support the de-risking strategy and high-grade results such as 10m at 10.55g/t gold from 42m in the Southern Zone that supports the project's growth potential.
Likewise, drilling has extended the Datatine high-grade shoot in the Northern Zone by ~240m down-plunge after returning a notable intercept of 6.6m at 3.4g/t gold from 362m, reinforcing its potential as a high-grade underground prospect that remains open down-plunge.
Drilling at regional prospects has also intersected broad gold zones, which reinforce Ausgold's belief in the prospectivity of its regional growth pipeline.
Road ahead
Besides the upcoming DFS, Ausgold is focused on permitting.
'We will have our initial application in by the end of this month to start the permitting clock, which we think is around a nine-month timeline,' Dorward said.
The company is also looking at debt financing, led by chief financial officer Benjamin Stockdale, a experienced operator who has assisted junior mining companies in securing financing for development of their first project.
'We are also starting detailed engineering and looking to buy long lead items as well as securing the last of the land access that we need in terms of compensating the underlying landholders,' he noted.
'It's going to be a busy 12 months but by end of Q1, early Q2 next year, we'll be looking to press the button on breaking ground.
'Once we publish the DFS, it is going to look to people like a very straight down the middle of the fairway, substantial Western Australian open pit gold mine.
'There's nothing challenging in terms of the mining or the metallurgy or the sort of the environmental aspects or anything like that.
'It's a straightforward project that's of really good size and it will make a tonne of money.'
At Stockhead, we tell it like it is. While Ausgold is a Stockhead advertiser, it did not sponsor this article.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Australian
10 hours ago
- The Australian
Rio Tinto names Simon Trott as new CEO amid $11.5bn half-year profit
The Australian Business Network However, Stausholm, who hands over the business to his iron ore boss Simon Trott in coming weeks, says it's something bigger than that. 'We've been getting back the mojo,' Stausholm tells The Australian. When he steps down on August 24, the Rio boss wants to be remembered for the impact he had on cultural change and especially for rebuilding bridges after the external shock of the Juukan Gorge cave scandal. The lead up to the Juukan destruction represented a period where the miner had lost its way. 'We were on our knees,' he says. Then, the miner was increasingly run out of London, and the core of Rio's once-powerful operational managers were being sidelined. The structure of the business was a mess that hadn't been tackled, leading to complex shareholdings across some of its most important operations, like the giant copper mine in Mongolia. There's still a way to go, but Stausholm confronted some of Rio's darker cultural demons and spent much of his tenure presenting a miner who was serious about working with rather than against its partners. Stausholm, who has had top executive roles with Shell and Maersk before Rio, says the lesson is that once you get the right culture in place, this becomes the foundation to build out an entire business. 'You actually then start seeing better operational performance, better execution of projects, and for the financial community, suddenly you have a business that actually grows – consistently profitable growth,' he says. His comments came as Rio delivered first half underlying earnings of $US11.5bn ($17.7bn), this was down 5 per cent on softer iron ore prices, but slightly ahead of market expectations. However, the dividend of $US1.48 a share fell short of expectations. This weighed on the miners shares in London. Rebalancing Significantly, increased production and higher earnings from the in-demand copper and bauxite helped offset a 13 per cent drop in iron ore prices. Rio's cashflow was mostly flat at $US6.9bn. While the contributions move around on commodities prices, Rio's copper and aluminium businesses are now star performers, representing around 20 per cent of the company's cashflow each. Previously it was closer to 10 per cent. Iron ore still dominates at 55 per cent of cashflows. Earnings from aluminium jumped 50 per cent thanks to higher volumes and prices. Rio also disclosed it was hit with a $US321m tariff cost, thanks to Donald Trump, but tariffs are starting to become a net positive for the miner, given the jump in copper prices. 'When you look at other miners, basically none of them are growing, and we are growing (production). We've said long term, the next 10 years, we can grow 3 per cent a year, but the reality is, we grew 6 per cent in the first half, 13 per cent in this in the second quarter'. We're really unlocking growth here, right now, and that's just comes from these underlying things – you get it right with the people, and we are already blessed with amazing assets'. 'You have not seen the best yet'. Still, Stausholm's tenure was cut short by his board. Just weeks after the annual meeting in May, the miner announced Stausholm's sudden retirement and launched a search for his successor. Two weeks ago, Trott, an Australian, was named his successor. Stausholm's high cost growth agenda, including near $10bn bet on lithium and expanding aluminium, is thought to have sat uncomfortably with the board. Since May, Stausholm has declined to discuss his looming exit except to say he is 'very happy' the board has backed an internal successor. However, he defended broader criticism around costs. 'There were a lot of things that needed to be rebuilt,' particularly around relations with traditional landowners, he said. Rio's productivity improvement program, the Safe Operating System, has been a major investment underway for four years and this is now behind the rising volumes coming out of existing mines and downstream operations like aluminium. But the trick in any company is to balance the rising costs that come with growth, he concedes. Under Trott, the challenge for Rio will be around the execution of the slate of development projects it has in front of it. Like rival BHP, it's now moving into a period of increased capital spending of between $US10-11bn over the medium term on projects like Simandou iron ore in Guinea; expanding the Pilbara; building out aluminium capacity; and the battery minerals bets that include the acquisition of lithium major Arcadium and the development of the Rincon project in Argentina. In recent years Rio has been spending around $US6-7bn a year on capex. There was nothing in the recent results to suggest that Rio would be on a different track. Stausholm has a high conviction in the projects ahead of Rio, with the company now in a place where it is executing well. Nor is he phased on the current malaise in lithium prices, 'It doesn't really matter, to be quite frank, for us, because what matters for us is what is the lithium prize five years from now. What we're trying to be is countercyclical and think long term'. This is now all on Trott to deliver. Read related topics: Rio Tinto Eric Johnston Associate Editor Eric Johnston is an associate editor of The Australian. He has more than 25 years experience as a finance journalist, including a former business editor of The Australian. He has been business editor of The Sydney Morning Herald and The Age and financial services editor with The Australian Financial Review. His work has also appeared in The Wall Street Journal.
The Australian
10 hours ago
- The Australian
NNL eyes golden jackpot in Finland
Nordic starts diamond drilling in Finland to test shallow extensions of gold mineralisation at its Kopsa project Drilling will also test deeper anomalies under the existing resource and further along strike Company will additionally drill selected targets at the Kiimala Trend project area Special Report: Nordic Resources has launched diamond drilling to test shallow targets for near-surface extensions along strike of existing resources at its Kopsa copper-gold project in Finland. Kopsa is the largest of the company's three gold resources in the Middle Ostrobothnia Gold Belt of Finland and has a resource of 23.2Mt grading 1.09g/t gold equivalent, or 814,800oz of contained AuEq. Besides testing the shallow targets, the drill program of ~5000m will also explore deeper extensions of the system for the first time and gather samples for detailed metallurgical testing. Nordic Resources (ASX:NNL) also plans to test certain gold prospects within the Kiimala Trend project area – another of the three resources in the MOGB. It follows the company defining a maiden resource of 264,000oz gold at the Hirsikangas project earlier this month, taking its total inventory up to 1.23Moz. The Finland gold projects. Pic: Nordic Resources Gold projects The Kopsa, Kiimala Trend and Hirsikangas projects sit within the MOGB, which contains a number of gold and base metal deposits that are structurally controlled by the Raahe-Ladoga Trend. It represents a geological extension to the Gold Line and associated VMS trend seen in neighbouring Sweden though it is relatively underexplored on the Finnish side. All three of the company's projects have significant exploration upside and are located within 75km of each other. There is a significant level of development optionality as the MOGB region hosts two third-party processing plants. More from NNL: Nordic embarks on discount Finnish gold dig First Quantum Minerals' 1.4Mtpa Pyhasalmi copper-zinc-pyrite processing plant remains in reduced operation and is 40km to the east of Kopsa while the formerly operating gold mine and plant at Laiva is 120km to the northwest. While the 2.2Mtpa Lavia plant is relatively new, having been completed in 2012, it is currently on care and maintenance. Both existing plants, or a standalone plant at Kopsa, would be potentially accessible by road or road/rail from the Kopsa, Kiimala Trend and/or Hirsikangas projects. NNL's diamond drilling will include about 4500m to test near-surface extensions along strike at Kopsa along with testing previously undrilled geophysical anomalism underneath the known mineralisation and anomalies further along strike for potential near-surface satellite deposits. The company also plans to carry out 500m to 1000m of drilling to test the least two of the known gold prospects at Kiimala Trend. This article was developed in collaboration with Nordic Resources, a Stockhead advertiser at the time of publishing. This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
The Australian
10 hours ago
- The Australian
Long Shortz: Chariot Corporation
Tylah Tully chats with Chariot Corporation (ASX:CC9) managing director Shanthar Pathmanathan after the company acquired the largest portfolio of hard rock lithium assets in Nigeria. This move marks a strategic pivot driven by strong Chinese demand for African-sourced lithium. Pathmanathan explained Chariot's focus on three key initiatives: drilling high-potential targets, partnering with artisanal miners for near-term revenue, and securing offtake agreements with Chinese buyers. With Nigeria's geology likened to Brazil and increasing global interest, the projects offer significant scale and access to the world's dominant lithium market. This video was developed in collaboration with Chariot Corporation, a Stockhead advertiser at the time of publishing. This video does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
