Manuka's Executive Chairman, Dennis Karp, commented: 'We are delighted to report on the positive assessment of the Mt Boppy cutback project and the associated statement of an Ore Reserve.
The 39,000 gold ounces are a significant addition to our Cobar Basin production strategy, with Manuka retaining flexibility to fund the cutback via free cashflow from operations, debt or a Joint Venture/Profit Share arrangement.
Manuka Resources Limited (ASX:MKR, 'Manuka' or the 'Company') is the 100% owner of the Wonawinta Silver Mine and Mt Boppy Gold Mine located in the prolific Cobar Basin of New South Wales. The Company recently released a 10-year Cobar Basin production plan1 comprising the mining and processing of 10.7Mt containing 19.2Moz of silver plus ~8koz of gold credits. The plan was forecast to deliver an average EBITDA of A$29M per annum at an IRR of 173% and NPV8 of A$153M off the back of A$18.9M capital expenditure.
Background
The Mt Boppy Gold Mine is located approximately 50km east of Cobar and 151km by road from Manuka's existing Wonawinta Processing Plant. Underground mining from 1897 to 1923 extracted high-grade ore to a maximum depth of about 230m. Open pit mining first occurred between 2002-2005 when Polymetals mined to a maximum depth of 80m extracting ~500kt at 5g/t. Under Manuka's ownership, open pit mining at Mt Boppy recommenced between 2020- 2021. Over 560kt of ore at approximately 3g/t was mined from the pit and hauled to Wonawinta for processing before a severe weather event caused flooding in the pit, instability in the pit wall and the subsequent cessation of mining activities. Against a backdrop of record gold prices and the Company's updated Cobar Basin production strategy, Manuka has undertaken an assessment to determine the feasibility of mining Resources grading >4g/t Au beneath the pit floor via a cutback to the open pit. The assessment has been performed to a Pre-Feasibility level and based on processing the mined ore via the Company's existing CIL Plant located at Wonawinta together with silver bearing ore mined from open pits at Wonawinta. No assumption has been made regarding the start date of the cutback, with Manuka retaining the flexibility to commence the Mt Boppy cutback project as capital funding or free cash flow from the Wonawinta silver mine allows.
Pit Design and Mining
The Resource model was regularised to a standard selective mining unit of 2.5m x 5.0m x 2.5m. Mining dilution and ore losses were accounted for during the standardisation process, resulting in a 7.8% reduction in gold ounces. A marginal cut-off grade of 1.0g/t based on a A$4,000/oz gold price was used for pit optimisation. Optimisations were run at different gold prices to determine the production target sensitivity to changes in the gold price. There were only minor changes to the production target for gold prices down to A$3,500/oz. The proposed design is a cutback that focusses on the southern and central portions of the existing pit. Overall pit depth increases by 80m, the equivalent of four benches. The pit design has a single 10m access ramp with four passing bays of 16.5m width. Geotechnical parameters including slope angles were adopted assuming that ground conditions that will be experienced are similar to those in the exposed current pit. A number of geotechnical risks have been identified that will need to be either further investigated prior to mining or managed throughout the mining process. There is currently ~500ML of water at the bottom of the current pit from the previous flooding event. This water will need to be pumped out before mining in the cutback can take place. At 83 litres per second there is approximately 2.5 months of pumping required to dewater the pit. Mining will initially target a rate of 4.5Mt per annum whilst mining predominately waste material before tapering off as high grade ore is exposed. Mt Boppy operations first operate two shifts per day for 17 months, with a forecast 90% availability and 80% utilisation. When working room reduces towards the base of the pit, there is eight months of mining on single shifts and utilisation is reduced to 40% and then to 20%, to allow the drill-blast-load-haul cycle to take place in a confined area. The major pieces of equipment scheduled were a CAT 390 80t excavator and CAT 349 50t excavator and six CAT740 38t trucks. The Manuka operating plan is to mine using dry hire equipment in the operation. Quotations have been sourced from local contractors for supply of the mining fleet and fleet maintenance. Manuka will supply the operators and fuel for operations.
Ore Haulage to Wonawinta Mined
ore will be stockpiled on site at Mt Boppy and then hauled 150km to Wonawinta for processing at a rate of ~13kt per month. A 966 Loader will be required for reclaiming and loading the ore onto haulage trucks. A water cart will be used for dust suppression on site as required. Haulage trucks are typically a B-Double configuration capable of a 55t payload. The trailers will be covered and self-tipping. Ore haulage is based on three trucks operating 6 days per week. Three trips per day are planned for each truck with breaks during the day to ensure the task is performed safely and within current national vehicle (fatigue management) guidelines. Ore haulage drivers would be accommodated at the Wonawinta camp at Manuka's cost.
Metallurgy and Processing
Mt Boppy gold ore would be processed in conjunction with the Wonawinta silver ore mine from open pits located at Wonawinta as an incremental part of the feed blend using the upgraded process plant design described in Manuka's 10-year Cobar Basin Production Plan (ASX Release 30 May 2025) The nameplate design capacity of the proposed new crushing and screening circuit is 180t/hr and can accommodate the expected maximum feed rate of up to 170t/hr. The planned 12,698 t/month of gold ore equates to an incremental milling rate of 19t/hr (assuming 100% mass recovery of Mt Boppy ore through the deslime circuit).
Infrastructure Infrastructure at the Wonawinta processing plant including the Tailings Storage Facility, water, power, accommodation is outlined in Manuka's 10-year Cobar Basin Production Plan (ASX Release 30 May 2025). Available infrastructure at Mt Boppy includes grid power, potable water from Cobar, tar road access, and a ~40 person camp with kitchen and ablutions, a 70kL diesel storage facility, an undercover heavy mining equipment workshop area, and mine offices. A capital provision has been made to upgrade the accommodation facilities and an engineered bund to manage the interaction between cutback and the dry tailings impoundment (TSF3) located at the southern end of the Mt Boppy Open Pit.
Environment and Approvals
Three mining leases (ML 240, 311 and 1681) issued under the Mining Act 1992 and four Gold Leases (GL 3255, 5836, 5848 and 5898) issued under the Mining Act 1906, are held by Mt Boppy Resources Ltd (a wholly owned subsidiary of Manuka). All permits are current and in good standing. The property on which the Mount Boppy mine is situated on Crown Land. A Native Title Agreement is in place with the traditional owners. The Company notes that no land within the licence area may be classified as sensitive land. No further approvals other than those required under the Mining Act 1992 are required. Mt Boppy operates under Development Consents 2006/LD00015 and 2011/LD-00070- Rev1, inclusive of an amended Mining Operations Plan (2020). A compliance review was completed in Dec 2024 on the Mt Boppy Mine. The following approvals are current for the Mt Boppy Gold Mine
Exploration Upside
The Mt Boppy deposit is silica dominated with associated veining and brecciation producing a high level hydrothermal system with multiple fluid phases. Current exploration targeting is integrating historic borehole geology and surface/airborne geophysics to fine tune drilling targets. What is evident is that complex thrusting and transpressional structures have emanated north from the closure of the eastern Cobar basin rift shoulder. The coeval and adjacent Florida volcanics (rhyo-dacite intrusives and subaerial felsic volcanic sequence) provide a potential heat and fluid source for development of epigenetic gold deposits displaying some low-sulphur epithermal characteristics.
Contact:
Dennis Karp
Tel: +61 2 72532020
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