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Wiluna transformation ready to begin as it charts three-year path to 250,000ozpa

Special Report: The first stage of a major expansion of Wiluna Mining Corporation’s Wiluna Gold Mine is nearing completion, with … Read More
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This article was originally published by Stockhead

The first stage of a major expansion of Wiluna Mining Corporation’s Wiluna Gold Mine is nearing completion, with commissioning of a new 750,000tpa flotation circuit set for December this year.

The addition of the new circuit will help Wiluna Mining Corporation (ASX:WMC) ramp up production to a run rate of 120,000ozpa by the end of the 2022 financial year, a major step change for the gold miner.

Construction is 75% complete, with mine development to access new mining areas now 35% of the way there.

Completing the flotation circuit is the first step of a three-year process designed to transform Wiluna from a modest 60,000ozpa cash generating producer of free milling gold to a large-scale gold producer turning out 250,000ozpa from multiple ore sources.

The company on Monday announced the end of a major 175,000m drill program to improve its confidence and extend resources to underpin the Stage 2 expansion, which will be outlined in a feasibility study due by the end of the March Quarter.

 

Expansion to realise Wiluna’s potential

Wiluna is one of the WA Goldfields’ great mining centres, with an historic and current gold endowment of more than 11Moz and over 7Moz in total resources, making it the eighth largest gold district in Australia to be consolidated under a single owner.

WMC produced 51,552oz at all in sustaining costs of $1794/oz against a realised gold price of $2627/oz in FY2021.

While that generated a tidy $20 million profit, the project is ready to be scaled up to make WMC a low-cost, large-scale mid-tier producer.

From the middle of next year Wiluna will have the capacity to utilize the 750,000tpa flotation circuit and existing 2.1Mtpa CIP mill to enhance its scale and process 750,000t of sulphide ore and 2Mt a year of retreated tailings from its Wiltails project into 120,000oz of gold concentrate and dore at costs of US$1150-1200/oz.

By 2024 the 750,000tpa flotation circuit will be expanded to 1.5Mtpa to enable WMC to process 1.5Mt of sulphide ore and a further 2Mtpa of tailings.

This should see the company producing at a rate of 250,000ozpa by 2025.

Wiluna has ambitious growth plans at its flagship mining centre. Pic: Wiluna Mining Corporation

Last items due for Stage 1 expansion next month

The last major items for the Stage 1 expansion at Wiluna, the main flotation cells, are due to be delivered to site next month.

Concrete work is now done, with structural activities 87% complete, mechanical work 65% complete and piping & electrical work 30% complete.

Meanwhile a tailings retreatment facility, to access a reserve containing 31.6Mt @ 0.6g/t for 579,000oz of gold, is expected to be commissioned in the March quarter subject to environmental approvals.

WMC worked with MACA Interquip to complete a plant layout and capital cost estimation during August.

The work will include the construction of a feed bin and conveyor, a trommel to repulp the tailings using flotation tailings, a lime slaking circuit for pH adjustment utilising existing BIOX equipment, and a pumping system to send the tailings slurry to the existing CIP leach circuit.

Tailings scrubber for the Wiltails project. Pic: Wiluna Mining Corporation

Development has begun in the Happy Jack and Bulletin underground mining areas while the Golden Age mine continues to be extended to deliver high-grade free milling ore for the existing Wiluna plant.

Eastern and downdip extensions at Golden Age are being evaluated and developed in the upper section of the mine.

The first ore drives at Bulletin Upper have commenced, delivering sulphide ore in August, with mining of the first two sublevels for sulphide ore development under way and first stope ore expected in October/November.

Underground development at Wiluna. Pic: Wiluna Mining Corporation

Around 15,000t of sulphide ore from development is sitting on the ROM pad awaiting the completion of the flotation circuit.

There has been promising news on the metallurgical front as well, with recently completed testwork confirming expected gold recovery from combined flotation and tailings circuits in the range of 92 – 95%, an improvement of greater than 4% from a previously advised Stage 1 feasibility study recovery of 88%.

 

ESG metrics continuing to improve

With the Wiluna operations set to consume more power and water once the expansions are up and running, work is ongoing to continue to improve the environmental, social and governance aspects of the mines.

Renewable power generation studies are continuing heading into 2022, with assessments of the wind resource at the remote mine site ongoing.

A hydrogeological assessment to secure long term water supply has also commenced and will progress through the feasibility study.

Wiluna has appointed ESG specialist Dr Jim Bawdon and community liaison officer Trish Botha to enhance its work with the local community, which includes the Martu Aboriginal People.

Wiluna Mining Corporation has been working to engage with the local Martu People. Pic: Wiluna Mining Corporation.

Among other things, the company says it is working to eliminate modern slavery from its supply chain and “build a respectful and mutually beneficial relationship with the Martu people”, and prioritise their involvement in employment opportunities, setting up small businesses and community engagement.

“Ms Botha has been very active since her appointment, meeting with several members of the Wiluna community and the local leaders and is working on our first initiative which we will hope to confirm in the next few months,” the company said.

This article was developed in collaboration with Wiluna Mining Corporation, 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.

The post Wiluna transformation ready to begin as it charts three-year path to 250,000ozpa appeared first on Stockhead.

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Evergrande weighing on Asian markets

China equities bashed on return to work Wall Street had a very noisy and choppy session overnight, buffeted by an impending FOMC, Evergrande, slowing growth…

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China equities bashed on return to work

Wall Street had a very noisy and choppy session overnight, buffeted by an impending FOMC, Evergrande, slowing growth prospects, Covid-19, the US debt ceiling, and the future of the Democrat’s $3.5 trillion spending bill; chose your crisis. When the dust settled, a few day traders were probably licking wounds, but the main indexes closed not too far from where they finished the day before. The S&P 500 closed just 0.08% lower, the Nasdaq rose 0.22% in a tech-safety play, and the Dow Jones edged 0.14% lower. US futures are almost unchanged in Asia, erring to the heavy side.

 

The return of Mainland China markets hasn’t been a happy one. Despite a CNY 100 bio liquidity injection from the PBOC, and news that a local Evergrande unit will make a local bond coupon payment tomorrow, equity markets have headed south. Evergrande is due to also make an offshore coupon payment tomorrow and there has been no word on whether this will happen, and that could be keeping local equities subdued. The Shanghai Composite has fallen by 1.90% today as Evergrande contagion fears take centre stage. The CSI 300 is 1.10% lower while Hong Kong markets are closed for a public holiday.

The negative day for China has spilled over to regional markets. The Nikkei 225 is 0.50% lower after the BOJ left policy unchanged. After two days of holidays, South Korea remains closed, but Taipei is playing catchup after a return from holidays, the TAIEX slumping by 2.20%. Singapore is 0.60% lower while Kuala Lumpur is down 0.40% while Jakarta is bucking the trend, helped by rebounding commodity and energy prices, rising 0.90%.

Rebounds in iron ore and copper, along with surging energy prices has lifted Australian markets by mid-session, after a slow start. The Evergrande local unit coupon payment news has also lifted sentiment, although Australian markets, seizing on any snippet of good news could be getting ahead of themselves, as no news has emerged on whether an offshore coupon, also due tomorrow, will be paid. Nevertheless, Australian markets are now solidly in the green, the ASX 200 jumping higher by 0.70%, and the All Ordinaries rallying 0.90%.

Given the neutral finish by Wall Street, and the negative tone pervading Asia, and with the FOMC to come later today, European stocks are likely to adopt a cautious stance this afternoon, remaining vulnerable to negative headlines emanating from China. The increasing noise surrounding the gas price rally is also likely to dampen spirits in today’s session.

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Precious Metals

Selloff Puts All Eyes on the Fed

Looking for a dovish Fed … the crypto sector suffers another drawdown … will gold ever register a pulse?

Tomorrow, all eyes are on the Fed.
It’s…

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Looking for a dovish Fed … the crypto sector suffers another drawdown … will gold ever register a pulse?

Tomorrow, all eyes are on the Fed.

It’s the most anticipated Fed announcement in recent memory. Investors are expecting hints about the timing and scope of a Fed bond-purchase tapering.

Economists surveyed by Bloomberg expect the November meeting is when we’ll get a formal announcement on the Fed reducing its monthly purchases of $80B of Treasurys and $40B mortgage-backed securities.

Of the 52 economists surveyed, two-thirds expect November. More than half of them believe the taper will begin in December.

But as we noted in yesterday’s Digest, Louis Navellier believes we’ll get more information tomorrow, which will calm markets.

From Louis’ Platinum Growth Club Flash Alert yesterday:

I am expecting a dovish statement.

I am expecting the Fed will clarify that they will begin tapering.

But it’s probably just going to be a mini-taper, not a big one. And so, I think it will be interpreted as dovish, and the market will rally.

***Louis isn’t the only one expecting a dovish Fed

Our hypergrowth expert, Luke Lango, also expects the Fed will tell the market what it wants to hear, resulting in a late-week rebound.

Interestingly, Luke points toward yesterday’s volatility as a clear signal to Federal Reserve Chairman, Jay Powell.

From Luke’s latest update of Hypergrowth Investing:

The Fed is slated to meet today and tomorrow to discuss monetary policy. Many Fed members have voiced a hawkish tone ahead of that meeting, advocating for some tightening via a tapering of asset purchases.

Wall Street is braced for this – investors are largely “OK” with a gradual and smooth taper.

But Wall Street doesn’t want anything more, and they’re letting the Fed know by selling stocks ahead of the meeting, basically saying: “Hey, Fed, if you tighten more aggressively than you’ve signaled, the stock market’s going to collapse, and the whole world is going to blame you.”

It’s a warning shot.

And it’ll work.

Luke believes that today and tomorrow could be choppy in the markets. But tomorrow at 2 p.m. ET, Powell will take the stage. Luke anticipates he will announce a taper, while delivering it in an ultra-dovish tone – pleasing the markets.

That will lead to a market rebound to close out the week.

***If you follow the money-flows, U.S. investors are also expecting this “Wall-Street-friendly” Fed

From Seeking Alpha:

The market is seeing a “monster reallocation cash-to-stocks as tax redistribution threat recedes & Fed expected to remain Wall St-friendly (liquidity easiest since Jul’07),” Michael Hartnett, BofA chief investment strategist, wrote in the “Flow Show” note on Friday.

How big is this reallocation?

Last week, investors dumped cash in favor of stocks at the greatest pace of the entire year. The outflows from money market funds registered $43.5 billion, the biggest of 2021, according to Refinitiv Lipper.

It also marked the largest inflow into U.S. large-cap funds ever. It was $28.3 billion, to be exact. Growth funds saw nearly $7 billion, with small-caps getting $4.2 billion.

So, the results of tomorrow’s FOMC meeting could be a market-mover. We’ll let you know how it goes here in the Digest.

***Stocks aren’t the only asset class in the red recently – the crypto sector has been suffering a sell-off

It feels like bitcoin and the crypto sector had finally begun turning the corner after the 50%+ drop from the spring. That was, until a flash crash from two weeks ago ushered in more weakness.

Yesterday’s multi-asset class selloff hit crypto as well.

From Forbes:

Cryptocurrency prices plunged Monday morning during a widespread market sell-off sparked by concerns of a potentially catastrophic debt default in China, pushing many of the world’s largest digital currencies to their lowest levels in more than a month.

The value of the world’s cryptocurrencies plunged to a low of less than $1.9 trillion by 8:45 a.m. EDT on Monday, nearly 11% less than 24 hours prior and reflecting a loss of more than $250 billion, according to crypto-data website CoinMarketCap.

Pullbacks like this are never fun to sit through, but they’re not unusual. So, it’s critical to avoid interpreting “temporary weakness” as a sign of “impending doom.” This is just standard crypto volatility.

Luke, who is also our crypto specialist, echoed this same point in his Saturday update of Ultimate Crypto. And this was before yesterday’s sector weakness.

After highlighting bullish adoption news about several holdings in the Ultimate Crypto portfolio, Luke wrote:

That’s not to say we won’t get a big sell-off here soon. We may.

That’s what cryptos do – from time to time, they plunge.

But it is to say that consumer adoption is progressing at breakneck speed, and consumer adoption will ultimately determine the long-term price trajectory of cryptos.

That’s why we’re more bullish than ever, and why we will be huge buyers on any future plunges in cryptos.

By the way, if you missed it, last week, Luke sat down with fellow crypto expert, Charlie Shrem, to discuss the huge opportunities in the crypto sector.

In short, they believe a new massive crypto bull market is forming, and certain cryptos are likely to go parabolic. Weakness like we’re seeing right now is offering investors greatly-discounted entry prices to top-tier cryptos.

If you’ve been looking for a time to begin a crypto portfolio, this is a good opportunity. To watch the free replay of Luke and Charlie’s event, just click here.

***Meanwhile, even with stocks and cryptos down and anxieties up, gold still can’t catch a bid

There was a time when steep selloffs in stocks and other asset classes would frighten investors, resulting in huge inflows into the “chaos hedge” of gold.

Though that time may return, it’s not here right now.

Yesterday, as all three major stock indexes dropped more than 2%, gold yawned, barely inching higher (and silver actually lost 0.6%).

Our macro specialist and the editor of Investment Report, Eric Fry, put a poetic spin on this…

The yellow metal is barely registering a pulse at the moment. Most of the wax figures inside Madame Tussauds museum seem more vibrant and lifelike.

But the thing about gold is it tends to come back from the grave at the exact moment that dejected investors finally leave it for dead.

Back to Eric:

After gold’s decade-long dormancy from 1991 to 2001, for example, it suddenly sprung to life and soared 500% over the ensuing decade.

More recently, the gold price drifted 40% lower during the seven-year span from 2011 to 2018. But then it revived once again and rallied as much as 70% from its 2018 low.

That rally was probably the first phase of what will become a much bigger move. Now that the gold price has spent more than a year going nowhere, it has gained plenty of rest for its next major move higher.

Frankly, the pessimism has grown so intense that gold is beginning to resemble a dream-trade for a contrarian investor.

Back to Eric to put some numbers on this:

Most folks want little to do with gold at the moment.

On a net basis, investors have withdrawn more than $15 billion from the SPDR Gold Shares ETF (GLD) during the last 12 months. That’s the most rapid and sizable retreat from this gold fund since 2013.

To summarize today’s approximate investor attitudes, they like stocks, adore cryptos, and feel sorry for gold and silver.

“Both metals are suffering from a complete lack of investor interest,” griped Ole Hansen, head of commodity strategy at Saxo Bank A/S, during Thursday’s abrupt selloff.

But remember, there are two macro factors in gold’s corner – inflation and soaring government debt.

Eric notes that the 12-month federal deficit stands at $2.8 trillion…which is a whopping 12.5% of U.S. GDP. Meanwhile, the six-month average U.S. inflation rate is hitting levels not seen in 30 years.

Back to Eric:

Historically, great, big governments deficits, coupled with great, big inflation readings, trigger great, big gold rallies.

Perhaps this time is different. But there’s a reason why many seasoned investors say that “This time is different” is the most expensive phrase in finance.

Because it is…

We’ll keep checking for a pulse here in the Digest and will let you know.

See you back here tomorrow for the post-mortem on the Fed announcement.

Have a good evening,

Jeff Remsburg

The post Selloff Puts All Eyes on the Fed appeared first on InvestorPlace.

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Gungnir up 42% on Swedish Nickel Drilling News

Gungnir Resources Inc. [GUG-TSXV, ASWRF-OTC PINK] shares rallied in active trading Tuesday after the company…

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Gungnir Resources Inc. [GUG-TSXV, ASWRF-OTC PINK] shares rallied in active trading Tuesday after the company released additional high-grade nickel results from continuing drilling at its Lappvattnet nickel deposit in Sweden.

Tuesday’s results are expedited assays from hole LAP21-05, located 40 metres along strike from hole LAP21-02, which intersected 3.19% nickel over 4.25 metres.

Drilling highlights from hole LAP21-05 include 2.62% nickel over 5.65 metres within a 14.00-metre interval, grading 1.40% nickel. This drill hole returned high-grade nickel intercepts less than 60 metres below surface.

Gungnir shares advanced on the news, rising 41.6% or $0.05 to 17 cents on volume of 3.68 million. The shares are currently trading in a 52-week range of 13 cents and $0.04.

The Pappvattnet and Rormyrberget nickel deposits are located in the eastern part of the Vasterbotten District, 60 kilometres and 100 kilometres respectively east of the company’s Knaften gold exploration project. The deposits are held 100% by Gungnir under two separate permits covering an area of 471.3 hectares. The properties are accessible year-round with good transportation and industrial infrastructure, including shipping facilities as there are a number of active mines in the area.

They collectively host 177 million pounds of nickel in inferred resources based on NI-43-101-compliant estimates by Gungnir in 2020

The deposits were discovered in the 1970s by the Swedish State Mining Property Commission and were subsequently held by Outokumpu Mining.  Exploration included geophysical surveying, extensive drilling (35,000 metres), metallurgical test work as well as development of an exploration shaft and drifting on the 120-metre level at the Lappvattnet deposit and initial resource estimates for both deposits in 1987.

The deposits came open for staking following exploration work by North Atlantic Resources (NAN), a company owned by Lundin Mining Corp. [LUN-TSX; LUMI-Sweden], and Blackstone Ventures Inc., under an option agreement with NAN in 2006. Gungnir submitted applications to acquire both deposits in 2015.

The Lappvattnet and Rormyrberget deposits are both magmatic nickel sulphide accumulations with tectonic, structural, and geological similarities to documented nickel and copper mines. The Lappvattnet deposit is largely a massive sulphide body that dips steeply to the south and plunges shallowly eastward.

Mineralization at Rormyrberget consists of both massive sulphide and wider disseminated zones.

Lappvattnet contains an inferred resource of 780,000 tonnes of grade 1.35% nickel or 231 million pounds of nickel. Rormyrberget hosts an inferred resource of 36.8 million tonnes of grade 0.19% nickel or 154 million pounds.

Drilling continues with tighter spaced holes at the shallow western part of the Lappvattnet deposit, with a current plan of 15 drill holes covering a strike length of approximately 140 metres.

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