Gum Creek’s 24% Inferred Resource Raises Questions Ahead of Feasibility Study

A Tier-1 Gold Asset in Western Australia

Horizon Gold Limited has provided a comprehensive update on its Gum Creek Gold Project, situated in the prolific Sandstone district of Western Australia. The project hosts a substantial gold resource of 2.14 million ounces, with 63% classified as indicated resources, spread across 26 deposits on granted mining leases. This positions Gum Creek as one of the largest gold resources in the region, supported by existing infrastructure and a history of production.

The company’s recent investor presentation reiterates that the project benefits from low mining recommencement risk, with the majority of gold being free-milling and recoveries exceeding 90%. Two major mineralised systems, the Gidgee Shear Zone and Howards deposit, underpin the base mill feed, together accounting for over 1.1 million ounces of gold.

Positive Economics and Development Pathway

Horizon Gold’s March 2024 scoping study confirmed the project’s economic viability at a gold price of A$2,900 per ounce, highlighting an attractive pre-tax net present value of A$548 million and an internal rate of return near 46%. The study envisages a standalone operation with a 10-year mine life, focusing on open-pit mining of free-milling resources from the Gidgee Shear Zone and Howards areas.

The feasibility study is progressing on schedule, targeting completion in the first half of 2026. Key workstreams include resource drilling, geotechnical studies, metallurgical test work, and environmental assessments. The planned central mill will be located at the historically permitted Gidgee site, leveraging existing haul roads, tailings infrastructure, and granted mining leases to streamline permitting and reduce capital expenditure.

Exploration Upside and Resource Growth Potential

Beyond the base case, Horizon Gold highlights significant exploration upside across the project’s 80-kilometre strike length. Recent drilling campaigns have returned promising high-grade intercepts, such as 15 metres at 28.5 grams per tonne at the Kingfisher deposit and 30 metres at 21.1 grams per tonne at Omega. These results suggest potential to expand both open-pit and underground resources, with a resource update expected in the second half of 2025.

The project also includes high-grade sulphide resources at Wilsons, currently not incorporated into the development plan but offering optionality for future mine life extension or toll treatment. The company’s experienced management team, led by Managing Director Leigh Ryan and Executive Chairman Peter Sullivan, brings deep expertise in exploration and project development.

Competitive Positioning and Regional Context

On an enterprise value to resource basis, Horizon Gold compares favourably with peers in Western Australia, reflecting the quality and scale of the Gum Creek asset. The project’s location within a well-endowed gold district, with nearby consolidation opportunities involving companies like Brightstar Resources and Aurumin, adds strategic value. Recent regional mergers and acquisitions underscore the attractiveness of the area for gold development.

While the project’s production target includes approximately 24% inferred resources, which carry inherent geological uncertainty, the company maintains that this does not materially affect the project’s technical or economic viability. Investors will be watching closely for the upcoming resource update and the feasibility study’s final results to better understand the project’s full potential.