Page 28 - pd281-Apr20-mag-web_Neat

AUstRALIAn GoLD

Horizon bright for Boorara

orizon Minerals Ltd is pushing ahead payment. some assets they had. It was just a prag-
Hwith plans to pour first gold from its “First ore treatment remains on sched- matic, nil-cash asset swap and there
Boorara project in the September quarter ule for the September quarter, so we aim could be more of that.”
after raising $6 million last month to begin to be mining [this] quarter, building up Price said his company had moved
Stage 1 mine development. our ore stockpile and obviously feeding on from the disappointment of failing to
In what proved to be a timely raising that into the Lakewood mill which is very acquire the Coolgardie gold project from
amid increasingly volatile market condi- close to us, to our west,” Price said. Focus Minerals Ltd last year, although he
tions, Horizon managed to pull together “The mining side of it lasts about six would not rule out Horizon making anoth-
a funding package comprised of a $2 mil- months and the milling side of it about er play for those coveted assets.
lion placement and a $4 million working eight months. Then we’re looking for- “It was a disappointing, long and
capital facility from German investment ward to having another solid $6 million drawn-out process, but we did our best
company Sparta AG. in the bank on top of our existing cash and we’ve moved on now,” he said. “We
Funds will be used to start key mining reserves [$2.2 million]. always had a Plan B and Plan C. We liked
activities at Boorara – only 10km east of “More importantly for us, it de-risks the the assets and still do and what might
Kalgoorlie-Boulder – this quarter, as well larger scale project and we’ll continue to come in the future we don’t know, but for
as underpin ongoing exploration work at work on the feasibility this year. We hope now we’ve got a lot on our plates to get
promising regional prospects such as to have that study completed by Decem- some value back for shareholders.”
Rose Hill. ber.” Price said he hoped market support
Horizon managing director Jon Price Horizon is expected to award key min- would continue for the junior sector dur-
said the raising was necessary to protect ing and haulage contracts this month, ing these challenging times created by
shareholders, given the company’s pro- with statutory approvals to follow later in the coronavirus pandemic.
duction strategy involves toll treatment the quarter. “You’ve got a really high gold price for
via the nearby Lakewood mill. While the start of mining at Boorara is the actual producers to be selling their
“Because we’re toll milling through a likely to attract the most attention and ex- gold into, but you’ve still got a really dif-
third-party mill, we needed to make sure citement outside of the company, Price ficult junior resources sector that contin-
we’ve got a sufficient cash buffer as we and his team are champing at the bit to ues to need the equity market,” he said.
work through the commencement of min- continue exploration across Horizon’s “We would hope that investors in Aus-
ing through to first gold production and wider portfolio in WA’s Eastern Gold- tralia and around the world start to have
revenue,” Price told Paydirt. fields. a look down the curve a little bit and look
“As always, we’ve made sure to mini- A recent review of historic data helped for value in the emerging mid-tiers and
mise dilution to shareholders. We raised confirm a resource of 1.2mt @ 2.49 g/t the juniors that are moving into produc-
the minimum we need to raise in equity gold for 95,000oz to a depth of 300m at tion.
in a tough market climate. The team did the Rose Hill prospect, acquired late last
a fantastic job and we’re very grateful for year as part of a strategic swap of ground – Michael Washbourne
some very supportive shareholders and with Northern Star Resources Ltd.
our new strategic financier. “We’ve known all those guys for 20-
“The last time we raised money in the odd years,” Price said. “They wanted
market was back in 2016 and that was to some assets that we had, we wanted Stage 1 mining of Horizon’s Boorara gold
get the Teal gold mine capi- project will begin this quarter
talised and under way. That
was a success and we’re
looking to do the same here
with Boorara.”
Stage 1 mining at Boorara
will see 159,000t extracted
from an open-pit mine design
at a fully diluted grade of 1.86
g/t gold over six months.
Assuming a 91.5% metal-
lurgical recovery from pro-
cessing via the Lakewood
mill – 7km west of Boorara
– some 8,700oz will be re-
covered for an estimated C1
cost of $1,570/oz and AISC
of $1,680/oz.
Stage 1 is forecast to gen-
erate $5.4 million in free cash
flow, based on a $2,400/oz
gold price, after all costs in-
cluding debt and interest re-

Page 28 aPRIL 2020 aUSTRaLIa’S PaYDIRT