The junior's scoping study for its 44,600 ounce at 1.3 gram per tonne Jeffreys Find deposit, located 45km from Norseman, Western Australia, suggests a combination of open pit mining and toll treating should generate a cash surplus assuming a A$2600/oz gold price.

 

Managing director Mark English said the project has attractive margins if it could strike a deal to use one of two third-party mills it had identified within 230km and could generate a cash surplus of $10-17 million.

 

A three-month starter pit alone would be expected to generate $4-8 million in profit. 

 

With studies, working capital requirements, and on-ground costs any development at Jeffreys Find is likely to require just $7 million to get into production, with actual start-up costs around $1 million to establish the mine.

 

The biggest single cost being around $400,000 to develop a 14.4km-long haul road from the mine to the Eyre Highway.

 

Depending on the mill, over the 12-month period it could produce 24,700oz by using the facility that is just 110km away, or 18,900oz by using the plant that is further away.

 

Head grade would be 1.5-1.6 grams per tonne.

 

Metallurgical work completed earlier this year indicated recoveries of 90-94% for fresh and oxidised ore.

 

It had had early discussions with mill owners.

 

A mining lease already covers the proposed pit, and a licence had been granted for the haul road, so the project is ready to go pending a feasibility study.

 

The cash injection from Jeffrey's Find would help test the nearby Neon prospect, study development options of its 198,700oz Munda resource, and pursue exploration at its recently secured Chalice West licence, and its other licences at Widgiemooltha and Spargoville. 

 

Auric, which started the quarter with $3 million cash remaining from its $7 million IPO in February 2021, estimates it has enough cash to get it into early 2023, when a capital raising may be required.

 

Auric shares closed yesterday at 6.5c, valuing it at $6 million. 

 

The stock has traded at 6.1-28c since listing.