Ora Banda Mining Transforming Financially To Further Exploration Activities At Eastern Goldfields

Ora Banda Mining Limited (ASX: OBM), formerly known as Eastern Goldfields Limited (until June 2019), is based in West Perth, Australia. The company is engaged in the exploration and development of its 100%-owned, highly prospective gold tenure in Eastern Goldfields of Western Australia, known as one of the Tier 1 gold mining jurisdictions worldwide.

Source: Company Website

The company’s strategic landholding comprises around six projects namely Davyhurst, Riverina, Mulline, Siberia, Mt Ida and Lady Ida Projects, including 112 tenements (1,336 km2) covering 200 km strike of the greenstone belt, with known high-grade gold, nickel sulphide and base metal mineralisation. Within the Davyhurst Project area, Ora Banda also has a processing hub with a capacity of @ 1.2Mtpa (conventional CIP processing facility) where both oxide and fresh ores are treatable. Besides, there is relevant infrastructure in place such as a 16-man camp, well-established road network, nearby airstrips, administration & workshop buildings and a large bore field.

The company is backed by an experienced and distinguished leadership team with extensive experience in the mining industry across geology, operations, project funding and legal affairs.

Since late 2018, Ora Banda Mining has been on a transformative journey to better its financial position and effectively progress its exploration and development activities to eventually move into production.

Financial Results for Half-Year to 31 December 2018: During the half year, Ora Bands Mining suspended all its mineral exploration and evaluation, open pit and underground mining along with gold processing activities at the plant on 3 September 2018 and focussed on formulating and executing a recapitalisation plan.

Thereafter on 29 November 2018, the company appointed Martin Jones and Andrew Smith of Ferrier Hodgson as Joint and Several Administrators of the Group.

As the year came to close, Ora Banda reported a net loss after tax of AUD 17,523,000 for the six months to 31 December 2018 while the company had net cash and cash equivalents of AUD 2.75 million.

Recapitalisation: After months of planning, the securities of Ora Banda Mining Limited were reinstated to official quotation on the Australia Securities Exchange on 28 June 2019 following a successful AUD 30 million recapitalisation process. With that, the company entered a new phase and embarked on a new journey as an aspiring gold development player.

To effectively implement its recapitalisation process, the company also carried out a significant marketing campaign across Australia as well as Europe (Switzerland and UK), US and Canada to proactively promote its activities.

Of the total proceeds, Ora Banda held AUD 15 million in cash to accelerate its key objectives being –

  • Systematic program includes infill and extensional drilling to existing resources.
  • Regional exploration program to testing advanced exploration prospects.
  • Drilling program results expected to be announced progressively over coming months.

The company also added that it would commence a detailed planning to cover enhanced resource and reserve estimation, mine planning, approvals, study work and economic modelling to underpin a measured and value driven production restart.  Not only that, to meet its planned schedule, Ora Banda also began ramping up its recruitment program.

June 2019 Quarter Cashflow: During the three months to 30 June 2019, Ora Banda had around AUD 15.76 million of cash outflows from operating activities while a total of AUD 28.84 million of cash inflows from financing activities. The cash and cash equivalents at the end of the quarter stood at AUD 14.142 million.

EPCM Cost Estimate: On 2 August 2019, a detailed review of Davyhurst Process Plant and associated plant infrastructure undertaken by GR Engineering Services Ltd revealed that the capital cost to complete remedial works and recommissioning the processing plant on an EPCM basis was 43% lower at AUD 8.52 million (Contingency cost: AUD 0.84 million) than the company’s previous capital cost estimate. This further encouraged the company to proceed lower capital cost leading to enhanced potential project returns.

AUD 18.5-million Capital Raising: Alongside its ongoing exploration at five key high priority targets (Riverina, Waihi, Callion, Siberia and Golden Eagle, with a JORC 2004 compliant Resource of 9.2 Mt @ 2.8 g/t for 840 koz), Ora Banda announced on 16 August 2019, to have raised a further AUD 18.5 million via issue of 100 million fully paid ordinary shares (Issue Price: AUD 0.185/ share).

Ora Banda’s major shareholder, Hawke’s Point Holdings I Limited maintained its level of shareholding by subscribing for ~ 42.4 million New Shares while other existing shareholders and new sophisticated and professional investors also extended strong support to the placement (settled on 23 August 2019).

Subsequently on 26 August 2019, the company reported to have received Tranche 1 (AUD 10.7 million) of the AUD 18.5 million-share placement.

Recent Updates

On 16 September 2019, Ora Banda reported the second set of results from the 2019 Riverina Phase 1 RC resource definition drilling program following the first set of results announced on 26 August 2019. The planned 6,200 metres drilling program is now complete, and all the samples received have been logged and submitted for analysis.

The company also added that the RC drill rig has now been moved to the Waihi complex (3 km from the Davyhurst processing plant) to futher the RC program in this area and is scheduled to return to Riverina following the return and integration of all the Phase 1 results into an updated mineralisation model. The previous results from Riverina included

  • hole RVDD16018 that returned 11.2 metres @ 22.4 g/t from 64.2 metres (announced 17 April 2019).
  • hole RVRC19019 that returned 6.0metres @ 13.4 g/t from 65.0 metres (announced 26 August 2019).

Stock Performance

Ora Banda Mining’s market capitalisation stands at around AUD 106.08 million with ~ 543.98 million shares outstanding. On 17 September 2019, the OBM stock price settled the day’s trading at AUD 0.185 with ~ 976,971 shares traded. Besides, the stock has delivered a positive return of 21.88% in the past three months.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above article is sponsored but NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. We are neither licensed nor qualified to provide investment advice through this platform.

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