New Murchison Gold (NMG) has released a feasibility study for its Crown Prince gold deposit in Western Australia, projecting a pre-tax cash flow of $226 million over a 30-month period.
NMG chief executive officer Alex Passmore said the study provided a sound basis for proceeding with the commencement of mining at Crown Prince.
“Feasibility work to expand the mineral resource, optimise the overall mine plan and de-risk the project in 2024 has contributed to successful advancement of the project,” he said.
“Securing an ore purchase agreement provides a solid basis for the project as little capital expenditure is required, and the path to production is significantly shortened.”
The project is expected to require a low capital expenditure of $5.4 million due to the company’s ore purchase agreement with Westgold Resources.
The agreement allows Crown Prince ore to be sold at the mine gate and transported to Westgold’s Bluebird mill near Meekatharra, WA.
Mining at Crown Prince is set to begin in June, with first ore sales scheduled for August.
The project’s feasibility study outlines a production plan based solely on ore reserves, with 140,000 ounces of gold to be mined over the life of the project.
An updated mineral resource estimate of 2.205 million tonnes at 3.9 grams per tonne (g/t) gold strengthens the feasibility study, while the ore reserve stands at 0.89 million tonnes at 4.8 g/t gold.
“The Crown Prince deposit is modest size, but high-grade, particularly in the Southeast Zone (SEZ) supporting early positive cash flows,” Passmore said.
“The SEZ is a new discovery where ore is available close to the surface, so 2025 will be another year of rapid progress to production for New Murchison Gold.”
Financially, the project demonstrates strong returns at the reserve price assumption of $3250 per ounce, while the life-of-mine (LOM) revenue is estimated at $426 million with a pre-tax cash flow of $109 million.
If gold remains at current spot prices, LOM revenue could reach $575 million with a post-tax cash flow of $181 million.
Next steps for the project include securing regulatory approvals, finalising infrastructure licences and assessing the underground potential of the deposit, which is slated for further study in 2025.
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
