Nexus Minerals Ltd (ASX:NXM) welcomes positive results from a scoping study for open-pit mining and third-party toll treatment of the Crusader-Templar gold deposit at the Wallbrook Project, 130 kilometres northeast of Kalgoorlie in Western Australia.
The company is exploring options to realise early cash flow from Crusader-Templar through open-pit mining and third-party toll treatment.
Positive outcomes from the study lay a foundation to refine material inputs and enhance the project's economics.
The study explored multiple options for using third-party processing plants, all within a 150-kilometre radius of Crusader-Templar.
Gold price contingencies
The study results indicate robust project economics across a wide range of gold prices, with positive outcomes achieved above a gold price of A$2,635 per ounce.
Using a gold price of A$3,000 per ounce for pit shell optimisations, the study assessed just 26% of the current gold mineral resource of 5.7 million tonnes at 1.7 g/t for 304,000 ounces.
If the gold price is set at A$3,500 per ounce the project is estimated to produce .5 million tonnes at 1.75 g/t, yielding 80,000 ounces and generating an undiscounted accumulated cash surplus of A$67 million.
With a gold price of A$4,000 per ounce, the surplus increases to A$106 million, while a price of A$3,000 per ounce results in a surplus of A$28 million.
Multi-pit campaign
Mining operations are planned as a Stage 1 multi-pit campaign over a period of 28 months with an average strip ratio of 16:1.
Pre-mining capital and start-up costs are estimated to be between A$2.2 million and A$3.3 million. Total funding requirements, including working capital, are projected to be between A$10 million and A$15 million.
The scoping study was carried out by Minecomp Pty Ltd, a Kalgoorlie-based consulting firm with extensive experience in the Western Australian Goldfields.
Based on the findings, Nexus will further refine material inputs and enhance project economics. Potential funding options include third-party agreements, operational joint ventures or a processing contract.
The study is based on the Crusader-Templar mineral resource estimate (MRE) prepared by Snowden Optiro. The base case optimisation at A$3,000 per ounce assesses components of the indicated and inferred mineral resources, producing 1.5 million tonnes at 1.75 g/t and an undiscounted cash surplus of A$67 million.
Funding required
The indicated outcomes will require funding between A$10 million and A$15 million for capital, start-up and working capital needs.
Nexus is confident of securing the necessary funds due to the project's strong technical and economic fundamentals, despite the inherent uncertainties.
The Crusader-Templar Gold Project is poised for commercial viability, with Nexus Minerals ready to advance permitting and regulatory processes, alongside exploring joint venture partnerships.
"Further upside"
Managing director Andy Tudor said: “The scoping study has demonstrated the attractive value and potential cash generation of the Crusader-Templar gold deposit over a broad range of gold prices.
“Importantly there is significant further upside as the study only includes 26% of the published resource of Crusader-Templar.
“Nexus can now take the next steps to assessing its various alternatives over Crusader-Templar, which may include sale, partial sale or joint venture to advance the project to commercialisation.
“However, Crusader-Templar represents only a small part of Nexus’ highly prospective large under-explore landholding, which we are excited to grow and add value through exploration.”