Rox Resources attracted a lot of interest at the Diggers. Phill Wilding followed up with this summary of the Rox story published in the Australian Mining Review.
High-grade opportunity at Youanmi
Junior gold developer Rox Resources (ASX: RXL) is riding the high of a transformative start to the year. Its flagship Youanmi gold project, located 480km northeast of Perth, WA, is rapidly evolving as development accelerates. Youanmi has more than a century of golden history. The site was closed in 1997, when the price of gold was around $400/oz. Since then, ownership has been the one thing holding the site back.
Since securing 100% ownership in 2023, Rox Resources has realised the true potential of the site. The company is consistently moving ahead on a streamlined pathway to production, delivering key milestones ahead of schedule.
Investor confidence is high, reflected by the successful $40m placement this year following a $27m capital raise in 2024. With a clear-cut development pathway and continued exceptional exploration results, Rox Resources is well and truly shedding its explorer title and inching closer to producer status.
What differentiates Youanmi from the fray of other emerging gold operations is its exceptional high-grade profile. The project has a historic production of 667,000oz of gold grading 5.42g/t from open pit and underground operations. The last parcel of ore was mined underground at a grade of 14.6g/t of gold.
Rox recently released an upgraded mineral resource estimate (MRE) for Youanmi of 2.2moz at 5.6 g/t of gold, a 21% contained gold increase on previous figures. The confirmed larger underground resource and lower open pit resource indicates Youanmi will be developed as high-grade underground mine from the outset.
Youanmi represents a unique de-risked development due to existing infrastructure at the site. Rox has been able to leverage this established infrastructure, including a historic decline extending around 600m below the surface, numerous pits, high-volume evaporation ponds, a mine village, access roads and even an airstrip.
Bolstered by significant investor support, Rox has accelerated early site works while completing a definitive feasibility study (DFS) for Youanmi. The recent commencement of dewatering operations at the Youanmi Main and United North pits are progressing ahead of schedule — bringing Rox ever closer to gold.
Rox Resources managing director and chief executive Phillip Wilding says there has been a flurry of activity at the Youanmi project from significant progress in dewatering, awarding of all contracts for the DFS and ongoing positive results from metallurgical test work.
“Rox is entering an exciting era as we advance toward our clear pathway to production,” he said.
The updated MRE incorporates results from the highly successful 35,000m extensional and 11,000m in-fill drill campaigns completed across the pits with a focus on converting inferred resources to indicated and discovering more near-surface gold.
The underground indicated resource grew by 396Koz, a 36% increase, to 1.5moz, representing 71% of the total underground resource. The gold grade also increased from 5.5g/t to 6.0g/t.
The drop in open pit resources aligns with Rox’s strategy to develop Youanmi as a high-grade underground mine from the beginning, rather than a two-phased approach of mining low-grade, high-strip ratio open pits followed by underground mining. “[The updated MRE] is a fantastic result with a lift in tonnes and grade for the underground resource, further solidifying Youanmi’s position as one of the highest-grade undeveloped gold projects of scale in Australia.”
Exceptional gold, exceptional value
The pre-feasibility study (PFS), released in July 2024, outlined an attractive production profile of more than 100,000ozpa for a total production of 786,000oz over an eight-year mine life with a compelling all-in sustaining cost (AISC) of $1676/oz.
With gold prices at current exceeding $5000/oz, the low capital and AISC present massive profit margins for Rox and ensures the project will remain resilient amid price fluctuations.
Despite the exceptional benefit of recent record high prices, Youanmi is not a gold price play. Even at modest gold prices of $3700/oz the project promises a free cash flow of around $1.3b.
“These prices are emphasising how undervalued we are, the cash flows from this operation are entering astronomical figures,” Mr Wilding said.
“The reality for us, even at prices of $3000/oz, we are an incredibly profitable operation.”
Many factors have contributed to the projects attractive AISC, including the historically established infrastructure. What may be the most convincing component, however, is the quality and structure of the gold itself — this is a high grade mine.
Metallurgical test work conducted over recent years showed three distinct types of gold mineralisation at the site — free-milling ore, semi-refractory ore and refractory ore.
The mineralogy testing indicated that 75-80% of gold mineralisation at Youanmi is either free-milling or semi-refractory, the most accessible forms. Up to 25% of the remaining gold is refractory, meaning it cannot be recovered through conventional extraction processes such as ultrafine grinding and cyanide leaching.
Leveraging modern technology
The deposit contains a considerable amount of sulphide minerals, namely pyrite, which host a large portion of the gold. A significant portion of the gold is semi-refractory in nature, which only requires ultra-file grind to liberate the gold. The refractory portion needs oxidation of arsenopyrite to enable gold recovery via cyanidation.
Following numerous test work programs, the Albion Process has been identified as the most efficient and cost-effective solution to producing gold doré on site at Youanmi.
Well-suited for semi-refractory gold, the Albion process provides controlled oxidation of sulphides, which liberates encapsulated gold without the high capital and operating costs that typically come with traditional methods — such as pressure oxidation and roasting — used for fully refractory ores.
The Albion process can provide recovery rates as high as 98% for Youanmi ores with a much lower capital and operating cost requirement than pressure oxidation.
Development timeline
Following completion of 46,000m of drill programs earlier this year, Rox continues to advance more resource definition and exploration drilling projects.
“Coming off the back of the latest drill program, which was completed on time and within budget, we’ve got a far better geological understanding of the project,” Mr Wilding said.
“We’re continuing works around the main ore body since finishing the initial program in April.”
Assay results from the program confirm the repeatability of high-grade shoots beneath the northern section of the main Youanmi ore body.
The updated MRE, released in July, now underpins mine design and drill planning for the DFS, due for completion later this year. Workstreams underway include processing plant design, further metallurgical test work using the Albion process and tailings dam planning.
“Next steps will see early works commence on the first exploration decline in Q4 CY25, with the intent to undertake closer spaced infill drilling from underground, accompanied by deeper resource definition drilling,” Mr Wilding said.
At the Youanmi Main Pit, dewatering has continued at the planned pumping rate of more than 100L/sec discharging to the evaporation ponds. Once these ponds are at capacity, water will be discharged to the Kathleen and Rebel pits.
The pit is expected to be dewatered to a suitable level by early next year, with the planned Pollard exploration decline from the Main Pit to follow.
A final investment decision (FID) is targeted for Q1 CY26, supporting first gold production in H1 CY27.
Further exploration
Rox Resources holds 90-100% of the gold interests in the regional exploration tenures, which equate 643km2 and more than 60km of strike of the Youanmi Shear Zone. The belt clearly hosts a high-grade gold endowment that extends beyond current targets — representing significant growth potential for Rox outside of its current operations.
Though Rox plans to continue its focus on the operations at Youanmi, substantial near-mine exploration targets have reinforced the gold project’s significant upside potential in terms of scale and size.
The company currently holds several prospects with known gold mineralisation at varying stages of development. Rox’s current advanced exploration projects lie within the Penny North project area, located just south of the Youanmi deposits.
The Currans Find gold project presents another exciting potential operation for Rox, defined by three distinct zones of high-grade mineralisation identified through historical mining and exploration drilling. Located 20km south of the Youanmi mine site, Currans Find historically produced 6875t at 13g/t of gold in the early 1900s.
Rox Resources has demonstrated its ability to consistently execute ahead of schedule, reinforcing its status as a serious emerging gold producer.
“We’ve built a high-performing executive and management team,” Mr Wilding said.
“They bring a rare combination of skills for a junior, and we’re strategically positioned to get this operation off the ground.”
As gold prices continue to surpass record heights, Youanmi increases in profitability every day.
With one of the highest-grade undeveloped gold projects in WA, a clear strategy to unlocking shareholder value and a team delivering results, Rox Resources’ future looks as good as gold.
(20min delay)