Ora Banda board approves Final Investment Decision for Sand King
Sand King to become second underground mine at Davyhurst gold project
Company on track for F25 guidance of 100koz and 150koz in FY26
Special Report: Ora Banda’s board has approved the Final Investment Decision (FID) for its Sand King deposit, making it the company’s second underground mine at the Davyhurst gold project in WA.
This follows a recent 176% increase in gold resources to 3.4mt at 2.8g/t for 306,000oz at Sand King, which, along with a 54% bump in the flagship Riverina deposit resources to 468,000oz, brings the company close to hosting 2Moz of high-quality gold resource.
Sand King is slated to hit a steady state production level of approximately 60,000ozpa in the June 2025 quarter, with the portal due to be cut in the September 2024 quarter.
This FID aligns with Ora Banda’s (ASX:OBM) strategic objective of owning and operating at least two high-grade mines and to achieve mid-tier status by 30 June 2025.
The estimated investment capital required of ~$39m will be funded from cash flows provided from the existing Riverina Underground mine and existing cash.
150,000oz in FY26
The company is now on track to reach its goal of producing 100,000oz of gold at Davyhurst in FY25 with all-in sustaining costs of A$1,975/oz – A$2,125/oz.
When combined, production from the two operations will represent a step-change for the business as it grows towards a production outlook of 150,000ozpa in FY26 and reduces its all-in sustaining costs to below A$1,890/oz in FY26.
“This is a very exciting time for the company as the Ora Banda team has achieved a significant amount in a short period, finding two underground mines in less than two years since changing strategies – a success rate which also indicates the significant prospectivity of the belt,” MD Luke Creagh said.
“The Riverina Underground continues to ramp up well and with the support of Sand King Underground, is expected to deliver 40% year-on year growth and ~34% reduction in AISC/oz over the same period.
“Our DRIVE to 150 plan to target 150,000 ounces in FY26 firmly places us on the pathway to becoming a mid-tier gold producer, and the most exciting part is that we are only just getting started on unlocking this highly prospective and underexplored tenement package.”
Pic: Supplied (OBM)
Resource upside in all directions
Coupled with Ora Banda’s rapidly accelerating production and decreasing cost profile will be a significant exploration investment in expanding resources at both Riverina and Sand King.
The company has budgeted to spend approximately $25 million in FY25 focused on expanding Riverina trend and Sand King mineralisation.
Notably, the Sand King Underground mine plan also includes drill drives and infrastructure to benefit from any resource conversion or extension.
The current mineral resource is open in all directions and has only been drilled to a depth of ~300m below surface, with the company planning to commence an initial 45,400m underground drilling program in the December-2024 quarter.
In FY26, Ora Banda will spend up to $40 million on exploration, with numerous high-grade exploration targets identified to drive future organic growth options.
This article was developed in collaboration with Ora Banda, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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