Blackham Resources (ASX:BLK) has announced their first quarter gold production results at their Matilda Gold Project.
- Gold production - 9,240oz (5,010 - December month);
- Gold production commenced in mid-October 2016;
- Gold recoveries - 92% (Nov & Dec); and
- FY17 production target - 64koz to 71koz.
Analyst Comment: As production only commenced during the December quarter (ramp-up period) we saw little value in examining the headline gold production numbers too closely. We were however encouraged that the only major issue encountered during the ramp-up period, (mechanical issue with the secondary and tertiary cone crushers) has been resolved.
Catalysts: The March quarter is shaping up to be defining for Blackham for two reasons.
First, we expect the ramp-up period to be concluded during the quarter which should result in a significant increase in production (TSI estimate - 26koz). This will be driven by increased throughput as well as an increase to the head grade (TSI assumption - 2g/t to 2.5g/t).
Secondly, Blackham will release the results of their Expansion Study (TSI production estimate 180koz to 220koz Au pa). The Expansion Study is the key driver for our long term valuation and a positive outcome could see the Matilda Gold Project become one of the few gold mining operations in Australia that produces +200koz Au pa and not owned by a major producer.
The information in this release should not be the only trigger for your investment decision. We strongly recommend you seek professional financial advice whenever making financial investment decisions.
Valuation: We slightly reduced our valuation to $1.50 / share (share price $0.60 / share). The reduction was due to a decrease in our gold price assumption (A$1,625 / oz). To see the full details of our Valuation & Investment Analysis click on the button below.
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About Wiluna Mining Corporation Ltd
Wiluna Mining Corporation (ASX:WMC) (OTCMKTS:WMXCF) is a Perth based, ASX listed gold mining company that controls over 1,600 square kilometres of the Yilgarn Craton in the Northern Goldfields of WA. The Yilgarn Craton has a historic and current gold endowment of over 380 million ounces, making it one of most prolific gold regions in the world. The Company owns 100% of the Wiluna Gold Operation which has a defined resource of 8.04M oz at 1.67 g/t au. In May 2019, a new highly skilled management team took control of the Company with a clear plan to leverage the Wiluna Gold Operation's multi-million-ounce potential.
Wiluna Mining Corporation Ltd
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