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News.com.au
13-07-2025
- Business
- News.com.au
These ASX goldies are close to unlocking producer status
With the soaring gold price, Australia's next mob of near-term producers are champing at the bit to get their projects up and running. The timing couldn't be better to open a new gold mine, with price above A$5100/oz at the time of writing. Gold projects are unique in the mining world. With the advantage of installed infrastructure and a high price relative to more common metals, even a small gold operation can be a money-spinner. That means junior operators can quickly open up and generate cash from relatively modest operations with construction timelines that run shorter than a two-bed house. In a sign of the times nano-cap gold explorer Javelin Minerals (ASX:JAV) is chasing the goal of mining the ~34,000 recoverable ounces at its Eureka project in WA from the first quarter of 2026. One of two advanced projects on the company's books along with the formerly Ramelius Resources operated Coogee project east of Kalgoorlie, the decision to push ahead with Eureka could put $25-30m in the bank account of a company currently capped at just $12.5m. "When we executed the agreement to acquire Eureka, the gold price was around $3000 Aussie, which is only around 12 months ago when we first negotiated the transaction," Javelin executive chairman Brett Mitchell said. "The fact that it's up 40% from there, it opens up possibilities that we haven't seen before and the sector hasn't seen before, which is really exciting. " Assets that sort of haven't seen the light of day previously in larger companies are available and potentially to be picked up by smaller companies and developed." The project hosts a resource of 2.45mt at 1.42g/t Au for 112,000 ounces, including 62,000oz indicated, and a quick pathway to mining means the company could create rapid value in the current record high gold price environment. JAV is considering several options to mill its ore nearby, including the Paddington gold operations owned by Chinese giant Zijin Mining just 20km away. Engineering studies and the approval process for the restart of mining are well advanced, with the board aiming to be mining within 12 months. There's also room to grow the resource, with exploration progressing in parallel. That's a major benefit of the decision to mine at Eureka, which will see a contractor take on the risk of funding the development while Javelin rakes in millions in fresh capital without diluting shareholders. " A) it is transformational, b) it enables us to go and self-fund without any more requirement for capital, allowing further exploration at Eureka and Coogee," Mitchell said. "We can also look at other complementary gold project acquisitions in and around the WA Goldfields." Big and small developers heading for producer status Javelin isn't the only ASX gold explorer en route to becoming a producer in quick time. Here's a run down of some of the miners running hard toward development. Star Minerals (ASX:SMS) Star Minerals is aiming to become a small-scale gold producer at its 45,000oz Tumblegum South project as soon as 2026. A scoping study for the project suggested at gold prices from A$3000 to A$3800/oz the updated production target for the project ranges from approximately 167,000t at 2.43g/t producing 11,800oz gold, to 255,000t at 2.16g/t producing 15,900oz gold. That would generate an undiscounted accumulated cash surplus after payment of all working capital costs, but excluding pre-mining capital requirements, of approximately A$9.4m to A$19.6m. Drill results are pending from a recent program, with the company aiming to convert any remaining shallow inferred resources to indicated within the optimised pit in the project's scoping study. Once operational, the project could feed underutilised mills operated by the likes of Westgold Resources (ASX:WGX) and Catalyst Metals (ASX:CYL). Ausgold (ASX:AUC) AUC will take a little longer to get there, but will be ensconced in the ASX's prospective mid-tier once in production around 2027, after releasing a definitive feasibility study for its Katanning gold project in WA. AUC holds over 3500km2 of what's essentially an entire greenstone belt in WA's Great Southern region, and had an unconstrained resource of 3.04Moz of gold at an average grade of 1.06g/t. As part of the DFS, that was updated to stand at 69Mt at 1.11g/t for 2.44 million ounces of contained gold, constrained to an economic $4500/oz pit shell. The study also detailed an average annual gold production of 140,000oz over the first four years through a 3.6Mtpa processing plant, producing 1.14Moz in total over the mine's first decade. At a fairly modest gold price of A$4300/oz, strong project economics include a post-tax cashflow of A$1.37Bn, IRR of 53%, with all in sustaining costs of A$2180/oz over first four years and A$2265/oz over the life-of-mine. At a recent spot gold price of approximately A$5000/oz (US$3250/oz), the study flags a post-tax cashflow of A$1.36 billion (US$0.88 billion) and IRR of 68%. The plan now is to progress to a final investment decision, with AUC last week banking a $35m cap raising which will enable the purchase of long lead time items and ongoing exploration. Theta Gold Mines (ASX:TGM) Theta is targeting production at its 6.1Moz Transvaal Gold Mining Estates project in 2027, spurred on by record gold prices, announcing a decision to mine last month. The historic South African gold field sits 370km northeast of the global gold and business hub of Johannesburg, near the original gold rush town of Pilgrim's Rest in Mpumalanga. And with spot prices around double that used in the company's 2022 feasibility study it's no wonder TGM is racing to get into production. The old study suggested the project could produce 80-100,000ozpa over a near 13-year mine life at an all-in sustaining cost of just US$834/oz. An updated study is due in September and is expected to deliver vastly superior economics, with the development already boasting a positive net present value of US$432 million on pre-boom prices. Sydney-based equity markets advisory firm RaaS Research Group said last week the company could be due a re-rate once it's in production. On the funding front, TGM has secured a credit approved loan facility agreement and indicative funding terms from the Industrial Development Corporation for a US$35m loan. Forming part of the overall project debt funding, it will make the South African government credit agency a key stakeholder in the project. Challenger Gold (ASX:CEL) Challenger is targeting production later this year for its Hualilán gold project in Argentina. The company is in the midst of metallurgical testwork which is expected to be completed by Q4 2025 ahead of a standalone pre-feasibility study at the project. The company is aiming to confirm heap leaching as a viable pathway for processing low-grade material that was previously excluded from economic evaluation. 'This could materially enhance the scale, economics and development pathway for Hualilan, positioning it as a standout gold project in Argentina,' MD Kris Knauer said this week. CEL also has a three-year toll milling strategy on the cards which – based on conservative spot prices of US$2500/oz for gold and US$27.50/oz for silver – anticipates EBITDA of A$136 million, a post-tax NPV of US$50.5 million, and cumulative post-tax-free cash flow of US$56.7 million. Using a gold price of US$3300/oz, this EBITDA increases to A$221 million. These impressive financial metrics are from toll milling through Austral Gold's Casposo mill, which is based on exploiting only 3% of the current 2.8Moz resource at Hualilan. Mining will be focused on three shallow open pits producing 465,000 wet metric tonnes of mineralised material above the cut-off grade at an average mined grade of 6.2g/t gold and 35g/t silver. Ore will be hauled 165km on a sealed highway to the fully permitted Casposo plant, where recoveries are expected of 84.4% gold and 65.7% silver. West Wits Mining (ASX:WWI) The company is bringing one of the Witwatersrand Basin's historic gold fields back into production, after kicking off development of its Qala Shallows project last month. The 70,000ozpa development is the first step on the road to a potential 200,000ozpa production hub in the South African basin, the world's most productive gold basin responsible for turning out more than 1.5Boz of the precious metal since 1886. WWI controls more than 5Moz and recently executed a buyback agreement taking its stake in the Witwatersrand Basin project from 66.6% to 74%, giving the company more control over the project as commodity prices sit at record levels of ~US$3300/oz. An update to the project's definitive feasibility study is underway to reflect improved economics at higher gold prices – with the old study assuming a price of just US$1850/oz. Updated economics are expected to deliver a lower peak funding requirement, shortened payback period and higher NPV, plus an updated mine plan based on a lower cut-off grade. The company is targeting first gold pour from the project in Q4 this year. Western Gold Resources (ASX:WGR) WGR is fast-tracking its Gold Duke mine into production after securing a binding toll milling agreement with Wiluna Mining Corporation last month. The project hosts shallow, free-milling ore, enabling rapid, low-cost open-pit extraction and early access to production and is just 46km from the Wiluna processing plant. The agreement duration is 24 months, allowing the company to lock in its Stage 1 production, which involves the production of 447,000t at 2.55g/t gold for 34,000oz of gold from the Eagle, Emu, Gold King and Golden Monarch deposits. This was based on the 2024 scoping study which assumed gold price of $3500/oz, well below the current Australian gold price above the $5100/oz mark. An updated scoping study is expected this month. While stage 1 is underway, WGR will also be able to simultaneously develop Stage 2 for potential extensions to the life of mine (LOM) such as Joyners Find and Bottom Camp. 'This marks a monumental leap forward for Western Gold Resources and with gold prices surging, all mining approvals in place and a preferred contractor selected, we are well positioned to accelerate our transition to a gold producer,' MD Cullum Winn said. The company isn't resting on its laurels either, with exploration planned at several brownfields targets including Joyners Find, Bottom Camp, Emu/Eagle Saddle and Gold King/Golden Monarch Saddle. At Stockhead, we tell it like it is. While Javelin Minerals, Star Minerals, Ausgold, Theta Gold Mines, Challenger Gold, West Wits Mining and Western Gold Resources
Forbes
08-07-2025
- Business
- Forbes
Double Top Signals A Potential Steep Fall In The Gold Price
Rising costs and hints of a double peak in the gold price is starting to rub the gloss off the goldmining boom. The combination of higher costs and the potential for a steep fall in the price of gold could be seen this week in the share price of Northern Star, Australia's leading miner of the metal. Beware a falling gold price A favorite of investors since the gold boom started three years ago Northern Star has suffered a 10.5% price fall on the Australian stock exchange over the past five trading days, extending its loss over the past month to 18% Investors and analysts were dismayed with a production update released by the company on Monday which contained an unexpected increase in production costs and future capital expenditure. Analysts at Citi, an investment bank, criticized Northen Star for the increase in capex which was 15% higher than they expected. Unwelcome Cost Surprise 'Northern Star needs to work on guiding the market as capex has moved up almost $2 billion for the 2026 financial year,' Citi said. 'Capex associated with the (ore processing) mill expansion such as a thermal power plant is news to us.' Despite the bank's dismay with the company's guidance for the new financial year it maintained a buy recommendation on the stock but lowered its share-price target from A$22 to A$21, which is significantly higher than the last sales at A$17.18. Easily the biggest of Australia's goldminers, the performance of Northern Star is seen by investors as a guide to the broader sector with the sell-off in its shares seen as pointer to a possible sector-wide decline as the reality of rising costs starts to bite. English actress Tania Mallet guarding a pile of gold in her role as Tilly Masterson in the 1964 ... More James Bond movie 'Goldfinger. Photo by Silver Screen Collection/) Until this week, there had been unbridled optimism that a rising gold price would wash away cost increases with the $1000 an ounce rise in the gold price over the last 12-months underpinning a 51% increase in the ASX gold index. But doubts have been building for months that the best of the gold boom has passed with a steep fall more likely over the next 12-months than a further uplift. Chartists who track the gold price have been looking with concern at the 'double top' evident in the price which hit a high of $3433/oz on April 22 and effectively repeated that price on June 13 when gold returned to $3435/oz after a period of flat trading between the twin peaks. A weaker period of trading appeared to be developing last week, offset by a fresh bout of confusion over U.S. tariff policy which has kept the gold price around $3330/oz. Charting is an imprecise art, but it can be useful in showing a pattern in trading as well as pointing to a future trend. A double top is seen as a sign of a bear market developing, a shift which could see gold quickly retreat below the $3000/oz mark with $2500/oz possible by the end of the year. If that downward trend develops, as indicated by the gold-price chart, goldmining companies which have been relying on a perpetually rising price will find their costs coming under close scrutiny.
Zawya
05-06-2025
- Business
- Zawya
South Africa: Mining performance contracts in Q1 2025
Amongst the sectors that contracted in Q1 2025, mining performed the worst in the first quarter. In real terms, mining GDP declined by a notable 4.1% quarter-on-quarter (q-o-q). This decline subtracted 0.2 percentage points from overall real GDP. Amongst the sectors that contracted in Q1 2025, mining performed the worst in the first quarter Factors placing strain on industry The strain experienced in the mining industry is emphasised by the following: - The sector is in a technical recession. After also recording a (small) quarterly contraction of 0.1% in Q4 2024, the mining sector now meets the recession definition. This is characterised by two consecutive quarters of declining mining GDP. - Mining GDP has experienced a quarterly decline in four of the last five quarters. As an aside, the demand-side GDP data indicates that real private sector investment has also declined in four of the last five quarters. This speaks to low business morale and is an important factor that explains the sluggish GDP growth in recent quarters. - Compared to Q1 2024, real mining GDP declined by 4.2% y-o-y. - Poor mining sector profitability in the first quarter. This is reflected in Stats SA's gross operating surplus numbers, a broad measure of profitability. The poor profitability was despite a 1.3% q-o-q increase in the SA Reserve Bank's export commodity price index in Q1. This was driven by the sustained rise in the gold price. At least in part, the weak profitability can be explained by the poor production figures at the start of the year. - The compensation of mining sector employees increased by 2.6% y-o-y in the first quarter, below an increase of 3.9% in the non-mining sectors of the economy. PGM performed the worst Regarding the weak mining production in Q1, Stats SA mentioned that the production of platinum group metals (PGM) performed the worst. Disruptions to PGM mining activity due to heavy rain in the northern provinces in January and February largely accounts for the underperformance. The weather-related disruptions were not limited to the PGM sector, with production also curtailed in the chrome, gold and building materials industries. Because weather was the major driver of the poor mining sector performance in Q1, we should see some recovery in the second quarter. Outlook For a durable recovery, mining requires an improved regulatory environment. In the near term (next several months), mining production should recover from the Q1 weather-induced weakness. However, uncompetitive electricity pricing, ongoing constraints in rail and port logistics as well as global trade tensions, are likely to cap the pace of the recovery in mining output and profitability. Therefore, it remains essential that the domestic mining policy environment is supportive of a growing mining sector. The Minerals Council continues to review the draft Mineral Resources Development Bill and will further engage the Department of Mineral and Petroleum Resources to co-create a regulatory environment that will attract and support investment in exploration, new mine development and the sustainability of existing mines. This is to unlock the potential of South Africa's mineral resources to support higher rates of economic growth and job creation. All rights reserved. © 2022. Provided by SyndiGate Media Inc. (
Times
02-06-2025
- Business
- Times
Pound and gold rise as dollar falls on increased trade tensions
The pound rose to a fresh three-year high against the dollar, and gold headed back toward an all-time high on Monday after President Trump went back on the offensive in his trade war. Sterling strengthened 0.73 per cent to $1.355, its highest since the middle of 2022 and taking its gains against the dollar since the start of the year to more than 8 per cent. The pound also strengthened 0.08 per cent against the euro to €1.18, but is down 1.76 per cent against the currency since the start of the year. Safe-haven buying pushed the gold price up 1.75 per cent to $3,349.65 per ounce. Geopolitical and trade tensions saw gold hit an all-time intraday high of $3,500.05 on April 22. Investors ditched the dollar following an escalation in tensions between Washington and Beijing as a pause in the tit-for-tat tariffs between the countries looked to have ended. The dollar fell 0.66 per cent against a basket of currencies and is down by nearly 9 per cent over the past six months. On Monday, China accused the United States of 'seriously violating' a trade truce after Trump last week, in a post on Truth Social, said that 'China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US'. Last month, after talks in Geneva, China and the US agreed to lower tariffs on each other's imported goods by 115 percentage points for 90 days. The intention behind the temporary tariff climbdown was to cool relations to open up space for trade talks. Analysts at Deutsche Bank, the German investment bank, said: 'It is really hard to keep up or predict what's going to happen on trade at the moment, and that's before we factor in the full ramifications from the court ruling last Thursday night, and then subsequent brief stay of execution for them on appeal.' Last week, a US trade court ruled that Trump's 'reciprocal tariffs' were illegal, before an appeals court temporarily reinstated them. The White House has said it intends to overturn the original ruling. 'For now it seems likely that the tariff uncertainty will linger for a long time ahead, even if we're still likely past the peak aggressiveness of US policy', Deutsche Bank said. Trump has sharpened his commitment to protectionist policies after gradually walking back their most onerous elements in recent weeks. Late last week, the President announced that charges on imported steel and aluminium would double to 50 per cent from 25 per cent. Oil rose sharply, with the price of Brent crude, the international benchmark, up 3.27 per cent to $64.81 a barrel after OPEC+, the oil cartel, decided to increase output in July by the same amount as it did in each of the prior two months. Traders said that was a relief to those who had expected a bigger increase. The FTSE 100 rose by 0.06 per cent and the mid-cap FTSE 250 edged up 0.06 per cent. The yield on the ten-year UK government bond rose 4 basis points to 4.69 per cent.
Yahoo
01-06-2025
- Business
- Yahoo
Gold Is Sending Markets a Big Warning Signal
It has been a far different story for industrial metals such as copper, aluminum, and zinc. 'The highest-ever gold price vs. the Bloomberg Industrial Metals Spot Subindex at the end of May, based on our database going back to 1991, isn't a good sign for the global economy,' he wrote. U.S. stock prices remain high, and yields on Treasury bonds have been rising recently, not falling, as one would expect if nervous investors were dumping risky assets and buying the debt in a flight to safety. Sign in to access your portfolio
