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https://thewest.com.au/business/min...ffin-of-spartan-resources-takeover-c-15512418

Ramelius Resources boss Mark Zeptner drives another nail into the coffin of Spartan Resources takeover


Adrian Rauso


Ramelius Resources managing director Mark Zeptner wouldn’t be drawn on Spartan Resources. Credit: Michael Wilson/The West Australian

Mark Zeptner says gold mining aspirant Spartan Resources is a want and not a need, as his Ramelius Resources announces a mine shutdown and faces a fork in the road moment to deliver growth.

Ramelius last month grabbed a 17.9 per cent slice of Murchison region neighbour Spartan Resources, which has stoked speculation of an imminent takeover approach for the market darling.
But last week Spartan managing director Simon Lawson told The West Australian his company’s ballooning market value thanks to high-grade hits at the Never Never deposit means Ramelius may no longer have the firepower necessary for an acquisition.

On Monday Mr Zeptner responded to those comments via an analyst call after the release of Ramelius’ June quarterly.
“I won’t comment on other people’s opinion of our firepower . . . whilst we’d like to have Never Never in our portfolio, we actually look at it as a nice to have, rather than a need to have,” he said.

“We talked a lot on this call about our organic potential at Mt Magnet over and above what is a plus 10-year plan, as well as our Rebecca Roe project east of Kalgoorlie.
“So we have a number of internal growth projects over and above M&A options, and we can debate how much firepower we have available to throw at those.”

Ramelius is facing a looming production void and investor pressure to target growth amid a red hot gold price.
The company was mulling an extension of its depleted Edna May mine, but on Monday determined that the project economics “are not sufficient” to warrant an investment of approximately $300 million.
Edna May will be switched off during the first quarter of 2025.

“The financial commitment required combined with heightened technical risk inherit in relocating ancillary processing infrastructure and the need for increased pumping capacity at depth has resulted in the decision to place the site on care and maintenance once processing of existing stockpiles is completed, “ Ramelius said in an ASX statement.

The company expects care and maintenance costs of just $217,000 per year and anticipates “relatively few redundancies” with the operation’s 70-or-so workers to be redeployed “where possible”.

For the 2024 financial year Ramelius produced 293,033 ounces of gold at an all-in sustaining cost of $1,362 per ounce.
It expects production in the current financial of year to hit between 270,000 and 300,000 ounces at an AISC in the range of $1,500 and $1,700/oz.
At least 230,000 of the ounces are slated to come from Mt Magnet.

Macquarie analyst Andrew Bowler labelled the guidance “decent”, with the forecast output ahead of consensus.
Shares in Ramelius were up 1.6 per cent to $1.92 by 11am on a down day for gold stocks.