Ora Banda Mining Ltd (ASX: OBM), based in Perth, Australia, is a gold exploration and development company currently focussed on leveraging its expansive land tenure in the Eastern Goldfields of Western Australia with a huge mineral resource base of around 1.8Moz 9.2Mt @ 2.8g/t for 840koz contained in its well-analysed 5 key priority targets. OBM is a debt free company after it restored the official listing on ASX on June 28, 2019. The company also has a wholly owned gold processing facility (Davyhurst Processing Plant @1.2Mtpa), that is estimated to require only minimal remedial works to be fully reinstated to operations (substantially low recommissioning costs of $ 8.5 million on EPCM basis). The work is expected to take less than 6 months and the company seems to have a clear pathway to near term production.
Ora Banda’s ground holding, with known high-grade mineralisation of gold, nickel sulphide and base metals, broadly encompasses 6 projects- Davyhurst, Mt Ida, Riverina, Mulline, Siberia, and Lady Ida covering 112 tenements spanning across 1,336 square kilometres along a 200 km strike on the highly-prolific greenstone belt.
The project infrastructure in place that would facilitate a rapid start includes Large bore field, Admin buildings, Workshops, Airstrip, Extensive road network, Power line into the sites and 160-man camp.
Ora Banda’s ongoing exploration program includes infill and extensional drilling of the high priority deposits that present a great near-term production opportunity. Given the large land holding with a significant exploration upside, there is also a regional exploration program examining a number of advanced prospects. The key objective of these programs is to upgrade the known resources and then subsequently formulate a well-defined five-year mine plan encompassing both open pit and underground mining operations.
Current exploration activities are primarily focused on the five key priority targets located within different project areas - Riverina, Waihi, Callion, Siberia and Golden Eagle. The company envisions producing approximately 100,000 oz of gold annually from 2021 onwards from these priority deposits while there are many other open pit and underground prospects within the land tenure.
- Riverina: It is an advanced deposit where the total Mineral Resource recently got updated to 3.8Mt @ 2.3 g/t for 278k ounces of contained gold including an open pit Mineral Resource of 3.1Mt @ 1.8 g/t Au for 183 ounces of contained gold, marking the end of the Phase 1 of initial 6,267-metre Resource Definition Drilling Program at Riverina that was very successful and enhanced the potential of the prospect.
The company has now started with the Metallurgical and Geotechnical studies aimed at building on the current knowledge base. A Feasibility Study to define economic viability for the proposed open pit has also commenced while Ora Banda is also undertaking Environmental Studies to gain the necessary approvals.
- Siberia: On 12 November 2019, Ora Banda announced that Entech Pty Ltd, an independent and internationally recognised mining consultancy recently completed a re-optimisation and design review of Siberia prospect comprising the Sand King and Missouri open pits. The Open Pit Ore Reserve estimate for the two were estimated at 2,800,000 tonnes at LOM average grade of 2.3 g/t Au for 210,000 ounces Au, depicting 42% increase in the open pit Ore Reserve at Siberia on a whole, as compared to 2017 Ore Reserve estimate.
- Waihi: New results were recently released from the Waihi Phase 1 Resource Definition Drilling Program which primarily focussed on delineation and upgradation of an optimal open pit Mineral Resource and testing potential for further open pit and underground resource extensions at depth. The company is planning a near mine exploration program in the Waihi region.
- Callion: Having a huge past production results, the project located ~14km south-west within the Davyhurst project, has high hopes for future explorations. The company has suggested 1,200m of DD and ~7,800m of RC drilling as being currently budgeted. The first set of outcomes are expected in early December 2019.
- Golden Eagle: Another great prospect located within Davyhurst project, Golden Eagle has a present resource of 656Kt @ 2.5g/t for 54koz. and remains open down plunge. The drilling which is planned will infill the current resource to upgrade to JORC 2012 standards to deliver a initial reserve.
Well-Funded to Fast-Track Exploration
With its securities reinstated to trading on the ASX in June 2019 after a successful recapitalisation process of $ 30-million, Ora Banda Mining embarked on a new journey, with the ultimate focus on unlocking the maximum value from its strategic highly-prospective land tenure via high impact exploration, resource definition and detailed mine planning. To fast track the project towards production, the company has raised about $ 50 million since recapitalisation and is currently well-funded with a strong cash balance of $ 20.64 million as at 30 September 2019, to advance its planned resource drill out, Definitive Feasibility Study (DFS) and regional exploration programs over the next 12-month period.
Right Location, Right Commodity
Australia has a thriving resource sector and holds second rank in terms of global gold production with 321 tonnes produced during 2018-19. Australia’s resource and energy export earnings are all set to continue breaking fresh records in the upcoming year, as per a forecast by the Department of Industry, Innovation and Science (DIIS).
Moreover, the global markets have been witnessing gold price rally over quite some time now. Key factors supporting gold include-
- Higher economic uncertainty, trade and geopolitical tensions.
- Correction in global equity markets is causing flow of funds into gold.
- Central Banks hoarding on Gold and excessive buying by gold backed ETFs.
Ora Banda is all set to shine, given its swift exploration momentum to enter production shortly, at the backdrop of a positive global outlook and an impressively huge ground package in the well-known bountiful Eastern Goldfields. DIIS has estimated that the World gold consumption is likely to upsurge by 3.7% in 2020 and 1.2% in 2021. The company presents an amazing investment opportunity to gain exposure to gold commodity.
Market Capitalisation: $90.9 million; Outstanding Shares: 586.42 million
OBM settled the day’s trading on 5 December 2019 at AUD 0.160.
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