Hey Wassa, As I read it, first ore will arrive to the mill in H125, with development of the drive beginning in about 6 weeks time. That means 12 months to first ore (from the reserves). Again, that excludes any potential to mine remnant ore or untouched stopes. Yes, the decline will continue for much longer than that, but that won't stop them being able to produce commercially earlier than that. Def worth taking a look back at these announcements and discussion in the years to come Undoubtedly I will have mud on my face.
As for the total cost, that is just part and parcel of U/G mining. I agree that of course WGX has put the information in as positive a light as possible. Yet... in the end the AIC is seriously impressive. GOR all in costs on par, and they are industry leading. GF is going to become a key asset for WGX over the longer term, which... is so important for a company that until recently, as WB mentioned at the Moneyofmine interview, was all about ounces, not margin per ounce. WGX is hopefully going to be able to keep refining the business to focus on longer life U/G mines with low costs. Big Bell Deeps is hopefully going to mirror Great Fingall, with long (potentially 10-15 years) with low costs.
@jbad94 - WB def side stepped that one. In some ways he has to, because he does have quite a few viable options around his mills. He mentioned in the interview below (and I am seeing it across the sector), the junior explorers are hurting... so hard to attract capital. Cashed up producers are in the best position they have been in for decades, yet, so few options for them to buy quality projects in W.A. Though of course, if you have a plant, options are more plentiful.
@Joelstar - without doubt, a good interview, which, when coupled with the presentation at diggers, gives us about as much info as one can have on a publicly listed company. He was least confident when talking about GCY, not being negative about that, just, he was least able to tell what he really thinks. He is very polite about everyone around him in the sector, so nothing to pick up there.
Like others, I think it is clear that WGX did not make an offer for GCY when they almost went under, not because WB did not want to, but because the board would not let him. Remember, WGX was bleeding heavily until the start of this year. Just bad timing for WB, if it had happened perhaps 3 months later, who knows. The question has to be asked why MZ at RMS did not move... I still believe it's ego on his part. For years he was right that Dalgaranga's open pit was no good, but... now he cannot see that it's irrelevant when you have a discovery like Never Never change the entire premise of why Dalgranga assets are worth more.
WBs comments on the Murchison having too much processing capacity is a real red herring (perfect example in regards to the Tuckabianna potential expansion). Just seemed to be all he could come up with as a negative for.... well.. anything. After listening to the interview again, and trying to better understand WBs exact statement of... "the Murchison has way too much processing capital, does it need it all, no, does it need fewer bigger mills, probably.... yes, so some of those companies come together, I mean ultimately maybe so... but... you know market forces, personalities", upon reflection, he is actually being incredibly honest about the situation. He is without doubt the most level headed MD in the region. SL comes next, then MZ and so on. This leads me to think that either the Mt Magnet plant needs to eventually be turned off... or one of WGXs. As the biggest plant is... Dalgaranga. Then Mt Magnet (just), then Bluebird, then Tuckabianna. This discussion could just as easily be on the GCY threads of course. As it really brings up a longer term view on what should be done. Dalgaranga is the lowest cost plant in the entire region. Simple fact. RMS has a huge stockpile of ore that is potentially going to become totally uneconomic if it is not processed in the medium term, because.... at some point the low grades means it just not viable even to mix it with high grades. Yet we know WGX is upgrading their 3 plants power systems, but... not all at the same time. Progressively over the next 12 months.
I think SL is not afraid to do a deal once he feels GCY/Dalgaranga has become more fairly valued, assuming no further U/G discoveries occur, but that is utter speculation on my part.
As I am trying hard to follow all the smaller explorers around the Murchison (there are more than my small list below), and lucky for WGX, they are all finding more gold! None of which will be able to justify a new operating hub, but... will be a nice addition to WGX if they ever want to acquire them, especially since many are quite a bit further away from the Mt Magnet plant, and... RMS will have no need for them with MGVs ore over the next 5-7 years.
ODY - 300k+ MEK - 1.1m+ GBR - 500k+ GCY - 1.1m WGX 6.8m+ RMS (Mt Magnet+ CUE) - 4.2m Rough total for kicks - 14m ounces (average grade... 1.8-2g/t) (220-250mt - seriously its a rough number). 5 processing plants approx 8.2mtpa. If they even just convert 50% to reserves, that is 15+ years worth.
A shame the 'boys' did not quiz Wayne further on why he thinks Never Never is so good.... maybe a comparison with one of WGX assets would have been a good discussion point. Also would have loved to quiz him on Big Bell Deeps, and other U/G mines that might come into the mine plan into the future, though... they all looked quite hungover compared to Wayne so..... cannot expect too much!
@plough - The issue with open pits these days, is that unless they high grade (above 2g/t), in many cases, they are not worth it, unless right beside a plant, or... you are literally running out of ore. A few MDs have stated as much in presentations this year. WB has lots of options, because, the 3 plants they own are so centrally located. So many stranded assets to pick up, IF... they beat the internal growth options, which in the case of Great Fingall and likely, Big Bell Deeps, won't be the case. They are just too good and suit WGX workforce/skill set. Though of course... Wayne made it very clear in the interview at Diggers, that WGX is focused on margin, not more ounces for the sake of it.
Above all, as long as WB keeps all his corporate actions within W.A I am happy, as EVNs MD recently discussed, companies that have operations over different continents, there are no real synergies... just look at NST, or SBM etc. Never really works.
WGX Price at posting:
$1.47 Sentiment: Hold Disclosure: Held
Undoubtedly I will have mud on my face.
Also would have loved to quiz him on Big Bell Deeps, and other U/G mines that might come into the mine plan into the future, though... they all looked quite hungover compared to Wayne so..... cannot expect too much!
(20min delay)