“AWJ has successfully established a first rate reputation as a ‘can-do’ emerging gold production company.” – Gavin Wendt, MineLife
Portfolio Stock Update
Auric Mining – (ASX: AWJ, Share Price: $0.225, Market Cap: $34m, coverage initiated @ $0.125 in March 2024 – current gain of 80%)
Key Catalyst
Mobilisation of plant and equipment has begun to the Munda Gold Mine site near Widgiemooltha in Western Australia, enabling the commencement of much-anticipated mining of the Starter Pit.
AWJ has established itself as junior gold producer within the prolific Eastern Goldfields of Western Australia. The company has successfully implemented a relatively low-risk incremental growth strategy that has been based upon self-sustaining and sequential development at each of its planned gold operations. The Jeffreys Find Gold Mine, located 40km east of Norseman, has been AWJ’s maiden production asset, generating net proceeds to AWJ in 2023 of $4.8M, with a further $8.1M received so far in 2024/2025, thus bringing total net receipts to $13M. AWJ is forecasting an additional $3M – $4M in net receipts from the last milling campaign, which means it will conservatively bank in excess of $15M from the project (likely $16M – $17M) – which is well in excess of AWJ’s initial $1.5M outlay for the project. AWJ is also concurrently moving ahead with its second gold production development, its Munda Project.
Overview
AWJ was floated in early 2021 as a gold explorer and emerging producer, with a focus on the Widgiemooltha – Norseman region of Western Australia. AWJ at listing boasted three projects within its portfolio covering an area of 470 sq km – Jeffreys Find, Widgiemooltha and Spargoville – which are being developed sequentially.
AWJ has demonstrated via its first production development, Jeffreys Find, that it has a successful template for low-cost, relatively low-risk gold production, at a time of rapidly rising gold prices, which in turn has allowed it to bank significant reserves of cash for future development and exploration.
Jeffreys Find Project
o The Jeffreys Find Gold Mine, located 40km east of Norseman, has been AWJ’s maiden production asset, acquired from Mincor Resources as a non-core asset following their focus on the Cassini nickel mine.
o JeffreysFindhasproventobearobustfinancialperformerforAWJanditsjointventurepartner, BML Ventures of Kalgoorlie. AWJ’s risk exposure has been mitigated by BML Ventures Pty Ltd, who incur and pay all operating costs and expenses. Once these costs have been subtracted, the surplus cash has been split equally between AWJ and BML.
o The Jeffreys Find depositis hosted on a pre-native title mining lease, which has offered a rapid path to production. The deposit held 47,000 ounces of gold grading 1.6 g/t Au hosted within a banded iron formation. Its shallow and wide surface profile has made it amenable for a simple shovel-and-truck setup, which in turn has delivered early and rapid cash flow. Jeffreys Find is set to yield ~30,000 ounces of gold over its project life.
o Mining commenced in April 2023 and by the end of Stage One a total of 9,746 ounces had been produced – with the average sale price of the gold achieved during 2023 being A$3,007 per ounce. Stage Two of the project took place throughout 2024 and into early 2025, with production amounting to more than 17,901 ounces that sold at an average price of A$4,024 per ounce.
o Mining at Jeffreys Find was completed on 28 January 2025. There remains~60,000 tonnes of ore on the ROM pad at the mine site, ready for haulage and processing. The ore will be toll-milled, which is expected to commence during the first week of July 2025 at the Three Mile Hill Plant at Coolgardie, with processing expected to take three weeks.
o Jeffreys Find generated net proceeds to AWJ in 2023 of $4.8million, with a further $8.1million received so far in 2024/2025, bringing total net receipts to $13 million.
o AWJ is forecasting an additional $3million-$4million in net receipts from the last milling campaign, which means it will conservatively bank in excess of $15 million from the project (likely $16 million – $17 million) – well in excess of AWJ’s initial $1.5 million outlay for the project.
o AWJ currently maintains~$7million in cash reserves, with more on the way from processing of the remaining stockpiled ore that’s set to take place in July, meaning AWJ is well positioned for its next venture, which is its Munda Project.
Munda Project
o The100%-owned Munda Gold Deposit represents the second plank of AWJ’s near-term growth strategy. Munda hosts an Indicated & Inferred Resource comprising 145,000 ounces of gold at a grade of 1.23 g/t (at a 0.5g/t Au cut-off grade), which will be mined over a period of 3 – 4 years.
o Munda will be fully operated by AWJ, which will ensure that all profits will be kept in-house. Preparations for a Starter Pit have just commenced, which will target production of 6,100 ounces over a period of ~6 months mining in 2025, designed to generate cash and also refine geological insights for a larger push in 2026. AWJ is talking to local mills for toll-treatment of its ore.
o AWJ has executed a contract to dry hire the mining fleet from MHM Contracting Pty Ltd, with the fleet to be operated by its own employees. A grade control program over the Starter Pit extents for those holes accessible from surface on a 5m x 5m pattern has been completed by Kalgoorlie- based Total Drilling Services, comprising 428 holes for 14,670m. Results have been received, allowing the mine geologists to define near surface ore blocks in advance of mining. Further grade control drilling on a 5m x 5m pattern will be undertaken as mining exposes new benches.
o The Starter Pit is the first stage in AWJ’s plans to mine a substantially larger part of the Munda Resource base. Following completion of the Starter Pit and a full analysis of the results, AWJ will then commence pit optimisation and mine planning for a much larger pit at Munda. Depending on the results of the Starter Pit and the subsequent work, AWJ aims to be mining a larger pit by mid/late 2026.
o At a nominal gold price of A$3,500 perounce, the Starter Pit could yield a$5.3million surplus (based on an A$2,635 all-in-sustaining-cost – AISC), whilst at today’s gold price of A$5,186 per ounce, the surplus could swell to ~$15.5 million. By early 2026, a main pit will roll out over 13 quarters, with ore processed at a nearby mill.
Growth Strategy Components
Aside from its four foundation projects – Jeffreys Find, Widgiemooltha, Spargoville, and Chalice West – AWJ has been busy securing additional strategic assets/projects that can enhance its near-term production growth profile.
Burbanks Gold Facility
AWJ has successfully completed due diligence for the acquisition of the Burbanks Gold Facility at Coolgardie, and is going ahead with the acquisition at a cost of $4.4 million (plus GST), with settlement to take place during mid-Q2 2025. The purchase of the Burbanks Plant and its associated assets and infrastructure, will enhance the company’s strategy of developing and expanding its gold production operations.
Lindsay’s Gold Project
AWJ during February 2025 executed a Binding Letter Agreement to acquire the Lindsay’s Gold Project from Top Global Mining Pty Ltd and NBC Mining Pty Ltd, subject to due diligence that is ongoing. The project consists of eight tenements spanning 33 sq km, including three granted mining leases and the partially-mined Parrot Feathers gold deposit. Should AWJ elect to proceed with the acquisition, it will be settled through a combination of cash and AWJ shares to the value of $4 million, plus a royalty.
The purchase aligns with AWJ’s strategy of acquiring near-term gold production assets within trucking distance of operational gold processing mills within the Kalgoorlie region. The company plans to conduct further assessments to finalise mining plans, with a focus on restarting open-pit mining at Parrot Feathers during late 2025.
Loded Dog Tenements
AWJ has further expanded its landholding within the Widgiemooltha-Higginsville area with the acquisition of the Loded Dog tenements from Loded Dog Prospecting Pty Ltd. The transaction was announced in February 2025, and involves the purchase of eight exploration tenements covering a total area of 113 sq km. The acquisition price comprises an initial cash payment of $475,000 (plus GST) at settlement, alongside milestone-based payments and a royalty agreement.
The Loded Dog tenements contain a mix of brownfields and greenfields exploration targets, with historical exploration indicating significant gold mineralisation potential. Notably, these tenements are strategically located near existing gold operations and infrastructure, enhancing AWJ’s exploration and development opportunities. The company will undertake further exploration programs in order to assess the full potential of these assets.
Technical Significance
AWJ has successfully established a first-rate reputation as a ‘can-do’ emerging production company. It has been happy to initiate small-scale, low-cost gold production by outsourcing key areas of potential risk with its starter project at Jeffreys Find, in turn generating reliable and substantial net cashflows. Further enhancing AWJ’s position has been an escalating A$ gold price, which has further complemented AWJ’s growing reputation as an emerging gold producer.
AWJ recorded a 212% increase in total net profit to $4.1 million before tax for the financial year ended 31 December 2024. It was accompanied by a 76% increase in total revenue to $8.5 million and a 62% increase in total assets to $21.6 million. AWJ has banked $12 million in cash over the past two years, with more to come in 2025 with the final treatment of remaining Jeffreys Find ore potentially bring in up to $4 million, plus initial ore from the Munda Starter Pit that could bring in around $15 million, based on today’s gold prices.
Strategically, AWJ maintains a pipeline of gold production for the next five years and is strategically located close to all necessary infrastructure including road, rail, power and processing facilities. We have known AWJ’s Managing Director, Mark English, for about three decades. He maintains a conservative and focused approach to project appraisal and development, which is reflected in AWJ’s production and market success. We have also met Non-Executive Chair Steven Morris, Technical Director John Utley, and Senior Geologist Nicholas Snow.
Share Price Performance v Gold Price
The graphic below shows AWJ’s share price performance versus the A$ gold price, over the past 12 months. AWJ’s situation also reflects much better market appreciation of junior gold equities, especially those with current or imminent production. We note that AWJ outperformed many of its sector peers, particularly during the period from June 2024 to November 2024, as its value surged on the back of strong net cashflows, and that there has perhaps been some profit-taking as the share price has consolidated.
Summary
AWJ is a successful, well managed and low-risk gold growth story that has enjoyed strong market support for its incremental growth strategy, particularly amongst retail and sophisticated investors. No longer is small-scale production viewed as being second-rate, especially when it is achieved without equity dilution for existing shareholders.
By being prepared to retain a 50% stake of net cashflows from its initial production asset, Jeffreys Find, AWJ has been able to rapidly accelerate gold production at a time of escalating gold prices. AWJ has avoided the time, complexity and costs of mobilizing equipment and hiring contractors independently, as well as eliminating the requirement for it to fund its proportionate share of working capital for the project. AWJ was therefore able to realise returns from Jeffreys Find far more quickly than if it was running the project on a stand-alone basis.
We now see AWJ well positioned with additional near-term cashflow from the processing of the remainder of Jeffreys Find ore, the Munda Starter Pit and potentially the Lindsays Mine.
AWJ therefore remains firmly within our coverage Portfolio.
