Ora Banda Mining Ltd (ASX:OBM, OTC:ESGFF) ended 2024 in a financially comfortable position, with A$57.8 million in the bank and the Riverina Underground operations at the Davyhurst Project in Western Australia fully paid off.
Robust underground strategy
It was a strong December quarter for the company, which demonstrated the robustness of its underground strategy. Cashflow increased by more than $9 million – even as Ora Banda poured $30.8 million into capital, resource development and exploration.
The Riverina Underground recouped the company’s initial capital investment during the quarter, generating positive cash flows within 18 months of kick-off, while mined grades continued to reconcile above forecast.
Similarly, the Sand King Underground operation intersected first ore just four months after the portal was set up, with a ramp-up on track to deliver up to 21,000 ounces in a stronger second half of FY25.
Riverina paid itself back
Managing director Luke Creagh said: “It is a testament to the quality of Riverina Underground that it has paid itself back in just 18 months and is now delivering strong cash flows which will self-fund Ora Banda’s production outlook towards 150,000 ounces in FY26.
“With Sand King Underground progressing on schedule, we have also reached an inflection point whereby the higher-grade feed from Sand King will progressively fill the Davyhurst mill, paving the way for production and cashflow to increase and costs to reduce."
Riverina Underground oblique view looking northwest.
Operationally, the company recorded no lost time injuries during the period and sold 22,288 ounces of gold, bringing total gold sales for the first half of FY25 to 47,824 ounces.
Gold production stood at 22,973 ounces for the quarter, with the first half FY25 total at 47,300 ounces.
The Davyhurst mill processed 280,000 tonnes of ore during the quarter, marking a 9% increase from the prior period as upgrades took effect.
Medium and high-grade ore from Riverina comprised 41% of the mill feed, while low-grade legacy stockpiles filled the remainder.
Higher-grade Sand King material is expected to replace these low-grade sources in the second half of FY25.
Sand King Underground Portal and newly established ventilation adit.
The figures tell the story
The company reported all-in-sustaining costs (AISC) of A$2,536 per ounce sold, including $116 per ounce in non-cash share-based payments and $183 per ounce from processing higher-cost open pit stockpiles, which are now depleted.
Closing cash rose to A$57.8 million, a $9.1 million increase from the prior quarter, leaving Ora Banda well-funded to support its growth initiatives.
Available inventory at quarter-end totalled 7,500 ounces, including 3,300 ounces in gold-in-circuit (GIC).
With planned infrastructure improvements, steady performance from Riverina Underground and Sand King advancing toward steady-state production, Ora Banda is well-positioned for a stronger second half of FY25 and aims to ramp up production to 150,000 ounces annually by FY26.
“As the business strengthens and the results start to come through on our exploration programs, we will be in a position to rapidly advance any additional opportunities that exist in our portfolio,” Creagh added.