
Wiluna Mining Corporation Limited (WMC) has reported on the outcomes of a pre-feasibility study on a potential restart of mining operations for Wiluna, undertaken by Mining One (PFS).
The Deed Administrators of Wiluna asked Mining One to author the PFS to develop an operational foundation for Wiluna based on conservative operating parameters, which would contemplate robust economic returns and the establishment of critical life of mine infrastructure that could then be utilised for sustained production or growth options.
The main constraint on the study was limiting the required restart capital to an amount considered viable for a recapitalisation of the Wiluna balance sheet given its status as a company subject to a Deed of Company Arrangement.
This resulted in a PFS that supports a projected 9.5-year operation that would prioritise sulphide material and restart BIOX processing at Wiluna, supported by the existing operational CIL circuit.
These processing circuits would be fed initially by an open pit mine, later transitioning to underground mining.
Tailings mining and tailings retreatment through the Wiltails repulper would also continue throughout.
Highlights of the PFS findings include:
- Production Target of 750 ktpa of gold ore to be processed, producing an average of 67,500 ounces of gold per annum over the proposed 9.5-year life of the mine
- Projected all-in sustaining cost (AISC) of $2,015 per ounce, C1 costs of $1,939 per ounce
- Low-cost growth capex (including refurbishing of BIOX processing facility; tailings thickener and camp upgrade) of $73 million
- At base case gold price assumption of $2,880:
- LOM free cash flow $364 million, 5.5-year payback, pre-tax NPV8 $198.6 million, IRR 53 per cent
- At spot case gold price assumption of A$3,084:
- LOM free cash flow $488 million, 3.75-year payback, pre-tax NPV8 $282 million, IRR 112 per cent
- New Ore Reserves established for Tailings, Open Pits and Underground that support Production Target
- Underground Ore Reserve 1.4 Mt of ore at 4.2 g/t for 191,000 oz insitu gold (proved and probable)
- Open Pit Ore Reserve of 3.2 Mt of ore at 2.0 g/t for 201,000 oz insitu gold (all probable)
- Surface Stockpile (Tailings) Ore Reserve of 22.9 Mt at 0.56 g/t (all probable)
- Total Mineral Resources (excluding Tailings, stockpiles and satellite) of 44.6mt at 3.69 g/t for 5.24 million ounces of in situ gold at the Wiluna Central Mine Area (as announced 29 August 2023 to the ASX)
- Includes income from operational Wiltails repulping circuit commissioned in October 2023
With the BIOX circuit refurbished, the operations would produce gold doré on site, removing difficulties associated with high arsenic gold concentrate, reducing transport costs, and improving gold payability.
The PFS is constrained by assuming limited capital available for Wiluna development, not potentially available gold resources.
The PFS assumes the use of less than 7 per cent of underground gold resources. Based on preliminary upside scenario analysis by Mining One, for parties with larger capital availability, significantly larger operations can be contemplated, having regard to estimated gold resources.
Wiluna will soon begin a strategic evaluation of the best way ahead for the firm by engaging parties interested in recapitalisation alternatives for WMC, such as funding or the potential to acquire some or all of the company’s assets.