20/05/2021 - 15:35

Wiluna Mining to join big league after $93m funding deal

20/05/2021 - 15:35

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Wiluna Mining Corporation is poised to build the production platform that will position it to become one of Australia’s next significant gold mining companies after closing a A$93 million equity and debt funding deal to initially catapult its annual production rate from 60,000 ounces of gold to 120,000 ounces over the next 12 months. The company continues to see strong institutional support for its big-picture Wiluna growth blueprint.

Wiluna Mining boss Milan Jerkovic: Wiluna can become one of the largest gold mines in Australia. Credit: File

Wiluna Mining Corporation is poised to build the production platform that will position it to become one of Australia’s next significant gold mining companies after closing a A$93 million equity and debt funding deal to initially catapult its annual production rate from 60,000 ounces of gold to 120,000 ounces over the next 12 months. The company continues to see strong institutional support for its big-picture Wiluna growth blueprint.

After extending debt financing arrangements with lender Mercuria to the tune of A$54 million, Wiluna Mining’s $39 million of new equity was snapped up by key investors.

They include Executive Chairman Milan Jerkovic and major shareholders such as Europe-based Delphi Group, Franklin Templeton and Arlington, all of whom appear to be backing  Wiluna’s new growth plan in one of WA’s major historic gold centres.

Mr Jerkovic said: “We are fully funded for Stage 1 and the Stage 2 feasibility study. Stage 1 is expected to be in commercial production in CY2022. Pending a successful outcome of the Stage 2 feasibility study, Stage 2 development will commence by the middle of 2022.”

The company has one of the Australian gold sector’s largest single-mine resource positions and continues to explore aggressively to grow reserves to support a build-up in both underground sulphide and free-milling ore production.

Having produced 4.7 million ounces of gold from more than 20 open pits and 10 underground lodes in a long and colourful past, Wiluna demonstrably still has plenty more to give.

Wiluna Mining is sitting on 7.02Moz of resources including 26.9 million tonnes at an attractive 4.89 g/t for 4.24Moz “under the headframe” in the Wiluna Mining Centre.

The shallow scope of tens of kilometres of underground workings over a 6km horizon at Wiluna compares well with other major WA goldfields production hubs such as the neighbouring Yandal base of Northern Star Resources.

The company has a target to outline a further 5-7Moz, including a high proportion of 4.5-to-7 g/t ounces at depth, based on a wealth of historic and new exploration data.

One of the WA gold sector’s most intensive ongoing drilling programs has already grown Wiluna’s underground reserves to 661,000oz at an average 4.74 g/t and the company plans to add at least 500,000oz to that this year.

Underground development is continuing apace after a recent landmark alliance agreement struck with one of the world’s leading underground hard-rock mining contractors, WA-based Byrnecut.

Production is building to 750,000 tonnes per annum from underground to underpin the phase one gold output.

Wiluna Mining expects to have its new concentrator ramping up later this year and it is aiming to wrap up its phase two feasibility study on expanding production to 250,000ozpa in the first half of next year.

Mr Jerkovic said: “At commercial production, Stage 2 will make Wiluna one of the larger gold mines in Australia. The differentiating factor of Wiluna Mining is its operating cash flows, whilst still boasting a prosperous three-year development program and outstanding exploration potential.”

With stage one net operating cash flows projected at circa-A$450 million from an $80 million project delivery spend and then ramp-up costs of close to $50 million, Wiluna is shaping as one of the most compelling WA gold stories that will unfold over the next few years.

 

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au

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