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Ora Banda Mining Limited

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September 16, 2024 at 2:20 PM (MDT)|Broadmoor Hotel & Resort

Luke Creagh

Chief Executive Officer

Luke is a mining engineer with over 20 years experience working for both contracting and mining companies at projects throughout Australia and overseas. Prior to joining Ora Banda Mining as Managing Director, he served as Chief Operating Officer of Northern Star Resources Limited. Prior to becoming COO in 2018, Mr Creagh held various senior positions within Northern Star, including GM Business Development, GM Strategy & Grown and Operations Manager. Before Northern Star, he was the Operations Manager at Barminco Limited.

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The orana story, which is a really exciting story. After a couple of years of, of going through a, a fixing phase, we're just getting to the start of a growth phase, which I'm excited to take everyone through. So what does it mean by fixing phase? So the last couple of years, we've transitioned, what was a massively unexplored belt from open pits to underground? And in that period, we've sort of went through over fy 2023 we did 48,000 ounces and then we've demonstrated quarter on quarter growth with investment back in the business, both from operating in the open pit perspective, but also in the processing perspective. And we saw that improvements sort of quarter on quarter culminating in a record year for us and a record quarter with nearly 20,000 ounces produced in June. The exciting thing about that is that's without any of the undergrounds that we've started and we've got two undergrounds. One's one's in commercial production now and one's starting. So what we've got starting the F I 25 F financial year is really big open pit stockpiles that complement the underground mill feed while we get our second underground going forward. So the platform for Fy 25 is sig significantly stronger than we've had before and setting us up for success going forward. But what do we have? So this belt is just north of Kalgoorlie. So we've got Kalgoorlie here and the scale of this belt cannot be understated. So it's over 100 kilometers from top to bottom. It's over 1100 square kilometers of tenure. And despite its proximity to Kalgoorlie, it is massively unexplored so forever and a day, there's you can see all the yellow dots, there's anomalies across this belt that have just been looked from an open pit perspective. And the exciting thing is is there's a leak, a shear that runs through here down here. And the I default, we have the convergence of two regional deep tapping mantle structures that's known for high grade mineralization across that belt. And there's numerous examples of that. Notwithstanding evolution's assets down here, that trend, there is nearly a 10 million ounce system. So it's a very exciting system. And then across this belt, there's only been 2% of the drill holes ever drilled below 100 vertical meters. So the search window for the for the last sort of 20 to 40 years has only been for open pits and that's with low grade then filling a small mill. So it's a 1.2 million ton per anum mill. And the previous iterations, we're trying to get the 70,000 ounces. So we pivoted two years ago to an underground strategy. The first underground we, we found and started within 12 months and has just reached commercial production with Riverina that'll do 80,000 ounces this year and 100 next year. And we found the second one here at San King. Now, we've unlocked those two deposits with $22 million of exploration drilling. So from a cold start, in under two years, we've got one to commercial production. We've started one and that's only with $22 million of exploration drilling. And that really points to the, I guess the excitement of the tenement package looking at it through an underground lens from a corporate perspective. We've never been stronger. We've, we've changed, we had a nearly a full change out of the board except for the chairman. we've got the disciplines covered and more importantly, we've got really good board dynamic. So the board is there to sort of support management team to unlock this belt. And what we're really doing is building a mid tier company over over the coming years. So it's exciting to have them supporting us. And then the management, it's been largely a new management team over the last couple of years. But basically all the disciplines covered genuine a graders in their field and setting us up for success going forward from a capital perspective. We've got, you know, obviously well rewarded so far in the market with the change in strategy, we've cracked over a billion dollars recently in market cap $27 million in cash. We paid back 7 million of our 11 mil debt last quarter. That'll get wiped in the coming months to zero. And more importantly, we've moved into a cash generated pha phase from the operations. So the growth we're going forward with will be funded from operational cash flow. So what does it look like from a chart perspective? So, like I spoke about this year and this year was largely open pit mining. So we went from sort of 48,000 ounces to 70,000 ounces. But this was a small contribution from Riverina Underground in this last financial year that's just completed. So with fy 25 that's going to 80,000 ounces and Fy 26 up to 100,000 ounces. And then San King, our second underground that started that'll reach commercial production in June. So really, we're talking in nine months, we're at a run rate that's at 100 and 50,000 ounces. And what does that really mean means in the current environment, we'll be knocking out sort of north of 200 million free cash flow on this profile. And the important thing of that is is that's only the start. So for the first time ever, the size of the Belt is actually owned by a company that has sufficient cash flow, sufficient size to own the belt and really liberate it going forward. So this year, we've allocated $25 million of exploration. That's really to extend the current minimized systems at, at Riverina and San King plus, look at a few others. And next year, we're allocating $80 million of growth capital of which half of which will go to exploration. So to put that in context, like I mentioned earlier, we spent $22.5 million to find two undergrounds over the next two years. We're talking about spending north of 60 million and we've already got sort of two undergrounds to expand plus numerous other opportunities. The other capital this year is 63 million included and that is about 40 million getting Sanki up to commercial production in the in the June quarter and then various other sort of minor upgrades in the system. So very very exciting. But we consider this 150,000 ounce run rate just the start for where we're going on this belt now on to Riverina. So that was the one just to the north, about 50 kilometers north of the processing plant, very stock standard, ramp up development sort of kicking in soap and kicking in. Importantly, we finished the June quarter last month. They ramped up to steady state targeted for fy 25 nearly 8000 ounces at 4.9 g, that's against the reserve grade of 4.2. So it's a system that we generally see can, can, supply good grade and, and good upside on that grade. It's very sort of normal sort of narrow vein. So the, the widths are sort of 2 2 m wide, that's ounce dirt, that's two ounce dirt. So we see it's my line structure, it's very, very consistent. It's got basalt basalt four w hanging wall. So the mining conditions are really, really good. So basically sort of mining 650 development meters a month, just over 3, 30,000, 35,000 tons a month. And plus we've been getting a 12% recon through the mill from the mining core grade. So presenting really well as an asset from a long section perspective, we are in the infancy of unlocking this system. So we, we talk about we're sort of focus up here, which is just the top few levels so far as where a lot of the infield drilling's been to convert to reserve. We've tagged this down to 500 m. That hole there is 6 m at 17. We stepped out a 500 m hole that's four at 10. And this hole here is 2.5 at 12. So the consistency of the structure is such that we hit those loads within a couple of meters of where we're expecting them, which gives us confidence that this system I is well and truly alive at depth. It's well and truly alive along strike and it's part of a massive system going forward. So what we're really looking at this year, so this was done with about sort of $18 million focused here. The rest was down at San King. What we really wanna test is, is, is how many sort of declines can we get going once we drill it? So what we wanna test is each decline here is worth about 75,000 ounces to 85 thou 80,000 ounces a year. And this hole here looks like a wild cat hole. But what we're testing is stepping out over here, what does a decline look like? Cos each decline will, will, will service about sort of 6 to 700 m of strike. So the exciting thing is we've had one underground rig on this up until recently. The second underground rig started this week and we got two surface rigs starting in early October and they're gonna test this whole package and then also down to 800 m below surface, which really what we're trying to target is a 10 year resource life. Plus production upside potential if this dual decline comes off and there's nothing to say. This northern one doesn't either because what happens is I'll show a slide later. This structure has been tapped for 7.5 kilometers to the south. What does it look like in plan view? That's not well understood in the in the long section is we've also actually got stacked loads. So every decline loop, so the decline comes out comes through here is accessing multiple loads. So the main load here is main load east that's been tagged for 7.5 kilometers. This main load west which just sits to the west and the foot wall that's mineralized but not as consistently. But when it does mineralize, it's very high grade. So you've got sort of nearly 2 m wide at 13 g. And this one down here is 2 m wide at about 18 g. And that goes for about 100 m. So when you look at this one, once again, the main load east and then we've got 16 g over sort of 80 m, another 100 m there, 90 19 g 2 m wide. So the wide space drilling that we've got underneath underrepresent these high grade trends. But basically what we're talking about is we've got 600 to 1200 ore development meters per level. So even though it's a narrow vein, we see a production profile per decline loop of about 7 to 800,000 ton. And if multiple declines start coming off, then you're sort of talking a million to 1.2 million ton of that. So super exciting. But this is early days is in unlocking the system. We've got 35 kilometers of drilling into the system. So I'd say less than 5% of what we'd call well drilled out. So moving down to San King, that's the second mind. So once again, fairly stock standard Ian start. So we cut the portal a few weeks ago. We're in about 100 and 80 odd meters. So portals started first development all be December quarter into the March quarter, Sting and city state in June. So that's what we talk about sort of June next year, we jump to that sort of 150,000 out run rate and we start delivering meaningful free cash flow going for forward slightly lower grade compared to Riverina 3.2. but a a bulkier system 4 to 6 m and up to sort of 10 m wide going there with some, with some good upside both on on strike extent and depth. So as a system we've focused on, this is the BD load. So that gets us in there. We've got northern northern loads, we've got Southern loads, we're just putting dual drives to go and tag. But also within this system, we see sort of high grade blowouts that aren't really modeled in, that's 11.5 at 615 at five. So if they come off, they'll be introducing both grade and tons for no extra cost. So very, very early days. but what we see, the more holes we drill into this system, the bigger it gets so very exciting to get that up and running and get, get some underground platforms going forward on here. And Diamond Dr Diamond underground diamond drawing starts here in the, in early November. So we get syncing up and going, what are we really talking about from a I guess investment perspective? And this is the investment thesis. When I go back to say there's no real exploration at depth on the next two slides, I'll show you what that actually means. And, and if you consider those two deep tapping structures, so the riverina section we showed through here. That's what I was four at 10. So we started drilling that 12 years ago and it's obviously in commercial production now, but we've got the 7.5 kilometers and most of this drilling has been the top 100 yet. All the, all the minimization has come from deep down. So what we wanna test really is, you know, how many, you know, repeats do we have in this structure? And with, with the drill bit this year, we'll start testing those step outs to the south. And if we get on to something as those cash flows start coming in from operating sort of mid next year, that's when we want to really start hitting things hard. And that's not just just there also, like I mentioned, we'll get down to Riverina down to 800 m as well, which will be pretty exciting. So if we just had Riverina, we'd be very, very happy as a system. 12 kilometers to the, to the west of Riverina, we've got something that's even more exciting. So the mull line trend, so there's about sort of 10 kilometers of strike there, 95% of the holes above 100 vertical meters and it is just littered with old pits and old workings from the 19 hundreds going down on quartz phones. But what we have got is the, the drilling that is below 100 m would be called discovery holes for any explorer. So this could be peeled out as an Asic exploration company. And the hits that haven't been followed up are phenomenal at depth. So 6 m at 10 sits there a meter at 245 with no follow-up. One of my favorites, 5 m at 30 no follow-up. So it's not just that the presence of the surface gold is there across that whole trend. It's the drill holes drilled underneath these systems are tagging really good high grade gold. So once again, we consider riverina in the infancy my lines even further back, but it'll be very excited. So once again, we'll, we'll spend a bit of money this this year trying to tag and unlock these systems. So in 12 months, we're basically in a position to hit these and hit these hard because as I mentioned, the convergence of these structures cannot be understated for the size minimization systems they can do and the grade they can bring from an underground perspective. So sustainability when you know, a cou a couple of years ago when we were just trying to survive, you know, that's, that's probably, I guess the sum total of sustainability. But what we've got now is we've really integrated into the business. So, it's really exciting to move forward from where we were. So basically in the purest form, like to, to me, sustainability is a lot more about listening rather than telling now. So you gotta listen to your stakeholders, you gotta understand, you gotta take feedback on board and you gotta build that into the business processes. So, of course, with safety and people, we do that internally stakeholders communities, we must engage with them traditional owners. The commitment to the ESG principles are embedded in our processes now. And we, and we've started doing all the little things well, starting to, you know, buy sensibly with ESG principles. We're doing the progressive rehab across the waste dumps really well. And we're starting to really look at, you know, power generation from a sustainable perspective as well. So that's exciting sort of as we evolve from the business, just, you know, hand to mouth, actually building sort of long-term business practices in what we're doing so really going forward, like, so we've got a long, really strong platform. So when you talk about, you know, 40 to 50% year on year growth that can't be understated. So it was going from 48 to 70 to over 100 to 100 and 50. So that's sort of super exciting. the conviction in the strategy that we've pursued is clearly delivering value. And it's, it's getting more exciting, more holes we put in. So about nine out of 10 of our holes are improving and expanding any system that we drill. And while we have that hit ratio, it's very sort of internally focused with what we're doing. The other thing is just the integrity of the brand, we're building IBM to just be a company that does what it says. So that's super important to us to show the, the drive to 150 was very exciting to put out. So we can show to investors this is what we're doing and this is how we're gonna unlock value and deliver into that. So we're super excited to put that out and super excited to be measured against that as we go forward. Like I said, the guidance increase I is really, is really, you know, can't be understated, but also for the f you know, the September quarter coming up, that'll be the first quarter where people will see what it looks like having three months of, of a good underground delivering and that only half fills the mill. So it'll, it'll give it, you know, I guess an indication of when we're fully filling that mill with high grade what it actually means. And, and that's a true transformation in the business. And then the final thing is we've got investment into the business of 25 million. Over the last two years, we spent 22 to get to undergrounds that 25 million we, we expect to extend the known minimization but also take a few others, which will be very, very sort of exciting to get onto. So, you know, we're really committed to now building the next mid-tier miner. We don't expect to be here for a short time. We wanna build this company up to rival, you know, so some really good names in the space, but we've got the organic profile and we've got sort of an enviable organic pathway to deliver that. So, looking forward to the next 12 months and beyond. Thank you. Thanks, Luke. We do have time for some questions. If there's any from the floor, just raise your hand and wait for the microphone. Luke one from me. Obviously, the the riverina ramp up, obviously going well and the potential there with San King. How quickly do you think you run out of milk capacity? And what are the options on that front? Yeah, it's a great question. Thanks Hayden. So we're putting a bit of money and we're going the mill up to 1.4 million ton. If that river in the south comes off, basically, really? Like we'd be talking in 18 months, we'd be looking at needing more milk capacity and, and we'd get a kicker because we could as, as like 100 g comes out 100 ton at the time. So you can certainly grade stream through existing mill, build, big low grade stockpiles. So you'd definitely get a production kick through that. But it'll be a nice problem to have when we run out of milk capacity and look at sort of, you know, internal upgrade options or, or different options with that. And do you see the mull line trend and the Riverina trend? Where, where are you backing more ounces to be? Do you think on exploration? Jeez, I love Riverina but like when you look at my line hits like, you know, I don't care who wins, but if they both come up, I'll be super excited. It is expiration, right? No, we just bank it in straight away. Well, Luke, thanks very much for the presentations. I much appreciate it.


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