Karora targets higher gold production in Australia
Karora Resources Inc. [KRR-TSX, KRRGF-OTCQX] said that after a record year of gold production at operations in Australia, the company is forecasting further increases this year.
“Following our record full year gold production of 160,492 ounces in 2023, gold production in 2024 is projected to be another significant increase of between 170,000 to 185,000 ounces,’’ said Karora Chairman and CEO Paul Andre Huet. The company is guiding investors to anticipate all-in-sustaining costs (AISC) of between US$1,250 and US$1,375 per ounce sold.
Karora is focused on increasing gold production at its integrated Benta Hunt Gold Mine and Higginsville Gold Operations in Western Australia, approximately 60 kilometres from Kalgoorlie, along the prolific Norseman-Wiluna Greenstone Belt.
The company was recently working to complete a second decline at Beta Hunt gold mine.
The second decline has been integral to Karora’s production growth plan to double throughput at Beta Hunt to 2.0 million tonnes per annum and increase gold production of up to 185,000 by 2024. The company previously said that target was expected to be achieved via a self-funded growth plan. The company has said the growth capital required is carefully phased over a 3.0-year period to allow for consistent free cash flow generation during the expansion.
By the end of 2024, Karora’s three-year growth plan will have been executed to deliver a 2.0 million tonne per year operation at Beta Hunt feeding two upgraded mills alongside contributions from Higginsville Gold Operations, the company said.
Karora acquired the HGO operations in June, 2019. HGO consists of a central gold treatment plant, a large historical resource inventory and a substantial portfolio of gold tenements, including open pit and underground mines.
The treatment plant is fed by material form the Beta Hunt Mine, Higginsville mining operations, and Spargos Gold Mine, which was brought into production in late 2021.
The company said its updated guidance incorporates a ramp up to an annualized 2.0 million tonnes per year production rate at Beta Hunt by the end of the year as well as contributions from Pioneer, Two Boys and stockpiles. The minor (5.0%) trim to the top end of the company’s gold production guidance reflects a focus on prioritizing higher margin Beta Hunt ounces over slightly lower margin smaller open pit options at Higginsville.
“At Beta Hunt, we are in a position of unique operational flexibility with respect to nickel mining,’’ the company said. The mine leverages shared infrastructure for both gold and nickel mining. However, due to the global cost pressure on spot nickel prices, the company is trimming its forecast payable nickel production in 2024 to a range of 200-300 nickel tonnes.
Karora shares moved lower on the news, easing 4.2% or 20 cents to $4.56. The shares trade in a 52-week range of $5.61 and $3.60.