A Northern Star Mark II ?, page-56

This note below fell off the back of a dump truck last night

leading analysts are clearly noting the step change in professionalism around the Davyhurst Project

Let’s assume Sand King is going to be the next underground to be developed in 2024 … which will then fill that mill

exciting to dream then what this company could look like in 2025/26 with up to $200 million free cash coming in the door annually

Such rapid organic growth around this known region of high grade gold deposits could fully fund the building of another Northern Star Resources imho

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Analyst comments

We visited Ora Banda Mining’s (OBM) Davyhurst Gold Operations including the Riverina underground development, Sand King and Missouri open pits, and key infrastructure of the Davyhurst plant.

Key Points

It’s the best we have ever seen the operations, noting that we have been to site on multiple occasions
Riverina underground development progressing very well, remains on track for first ores in early Q1CY24 (potentially late CY23)
– lifts production to +100kozpa

The Davyhurst plant can now process 100% fresh ores comfortably at nameplate 1.2Mtpa (implies higher blending options towards 1.4Mtpa)
Sand King is shaping up nicely as the potential second underground mine – drilling underway to test high-grade shoots, upgrade resources – key enabler to grow production to up 150kozpa
Wesfarmers Lithium deal provides funding (~$30m) to accelerate growth plans
Exploration upside cannot be understated – two regional major structures (Zuleika Shear and Ida Fault) to explore, proven endowment
Trading cheap to value, EV/EBITDA FY25 ~2x (vs peer average of +5x)

Davyhurst Plant – upgraded and running +1.2Mtpa
Crusher (tertiary) upgrade completed and can now treat 100% fresh ores at the nameplate 1.2Mtpa.
Blended throughput is expected to be ~1.4Mtpa, with further minor enhancements expected to optimise operations.
Great to see the high crushed ore stockpiles building which de-risks ore supply ahead of milling requirements.
Recoveries remain at target +90-92%, with mill head grades increasing as planned.Current ore sources of Missouri and Sand King open pits, with first high-grade underground ores from Riverina expected soon.