Ora Banda Mining Ltd (ASX:OBM) has doubled its underground gold resource to more than 300,000 ounces at 4.1 g/t, according to an updated mineral resource estimate (MRE) and maiden underground ore reserve for the Riverina Project.
Riverina MRE update.
The company’s maiden underground ore reserve is 73,000 ounces averaging 4.3 g/t, which supports the path to a production target for FY25 of 100,000 ounces per annum.
This is also set to be supported with more reserve conversion only limited by drilling density.
Riverina underground maiden ore reserve.
Robust estimate
Ora Banda said the new resource estimate was robust, with a minimum mining width of 1.6 metres used, and reserves calculated using a gold price of A$1,850 per ounce.
The resource remains open in all directions, with the second phase of exploration to start in March designed to extend the mineralisation envelope further south and at depth.
From here, the company intends to move swiftly toward a final investment decision (FID).
OBM is also looking to restart exploration at Callion and Siberia as it sets its sights on a second underground mine.
The company’s resource update proves the case for its three-year strategy to pivot from open pits to explore for high-grade underground mines.
Next steps
The next stage in this strategy involves setting up the underground mine and on this front, it has ticked off some key works.
The Riverina pit has been mined down a further 15 metres to fresh rock to expose main portal and ventilation portal accesses, with underground mining tender process well advanced and expected to be completed in March.
A mining commencement notice was submitted to DMIRS on February 10, with mining able to commence 45 days after this notice – Ora Banda will be able to start mining after March 27, subject to a FID and underground contractor mobilisation.
The investment case for the FID is expected to be presented to the Ora Banda board later this quarter and will include consideration of inferred material that will convert to reserve with further drilling as well as resource extensions.
Game changer
“We are very excited by the increase of the Riverina Underground resource and maiden reserve position,” Ora Banda Mining’s managing director Luke Creagh said.
“This update is a game-changer for the company because, subject to final investment decision, we have a genuine pathway to greater than 100,000 ounces per annum that is backed by reserves.
“This puts us in a good position to present a business case for the final investment decision, thereby placing this project squarely on a rapid development path.
“This result also validates the prospectivity of our tenement package, noting there has been no modern or systematic approach to target high-grade underground mines, so we consider this not just early days on the Riverina system, but early days across our entire tenement package.”