Kalamazoo Resources retains 100% ownership of its 1.44 million ounce Ashburton Gold Project and fast-tracks a scoping study amid soaring Australian gold prices. The company aims to unlock significant value from the Mt Olympus Deposit with a targeted study completion in Q4 2025.
- Kalamazoo regains full ownership of 1.44Moz Ashburton Gold Project
- Scoping study fast-tracked leveraging extensive prior technical work
- Re-optimisation shows increased mineable ounces at Mt Olympus
- Strong Australian gold price (~A$5,100/oz) enhances project economics
- Placement secured to raise circa $2 million for study and working capital
Full Ownership Regained Amid Strategic Shift
Kalamazoo Resources Limited (ASX, KZR) has announced it retains 100% ownership of its Ashburton Gold Project (AGP) in Western Australia following the expiration of an option previously held by De Grey Mining and subsequently Northern Star Resources. This marks a pivotal moment for Kalamazoo, as it now fully controls a significant 1.44 million ounce gold resource, positioning the company to independently chart the project’s future.
The option, initially granted in early 2024 at a gold price of approximately A$3,100 per ounce, was not exercised by Northern Star after its acquisition of De Grey. Northern Star’s strategic focus has shifted to its Hemi Gold Project, leaving Kalamazoo to capitalize on the AGP’s potential amid a dramatically improved gold price environment.
Scoping Study Accelerated in a Bullish Gold Market
In response to the current Australian gold price hovering around A$5,100 per ounce, an increase of roughly A$2,000 since the option was granted, Kalamazoo is fast-tracking a scoping study focused on the Mt Olympus Deposit. This study aims to define the optimal development pathway, incorporating processing strategies and financial parameters to unlock value swiftly.
The company is leveraging a substantial body of technical work completed by De Grey and Northern Star during the option period, including metallurgical drilling, geochemical analysis, and geological remodelling. This groundwork significantly reduces the timeline and cost for Kalamazoo to advance the project.
Enhanced Resource and Low-Cost Processing Outlook
Recent re-optimisation studies conducted by ERM International Group have revealed an increase in potentially mineable material at Mt Olympus to approximately 772,000 ounces at a grade of 2.53 grams per tonne, based on a conservative gold price of A$4,500 per ounce. This represents a 12–17% increase compared to 2023 estimates calculated at A$2,600 per ounce.
Metallurgical test work supports a straightforward processing route involving crushing, grinding, and flotation to produce a saleable gold concentrate. This approach is expected to be capital efficient and operationally simple, enhancing the project's economic viability.
Strategic Appointments and Capital Raising
Kalamazoo has appointed Simon Coyle, former General Manager – Operations at Pilbara Minerals, as Project Manager to lead the scoping study and future development planning. The company has also engaged BHM Process Consultants and Entech Pty Ltd to assist with technical aspects of the study.
To fund the accelerated study and provide working capital, Kalamazoo has secured firm commitments for a placement expected to raise approximately $2 million. The placement involves issuing over 22 million shares at $0.09 each, accompanied by free attaching options exercisable at $0.135 over three years. Directors have committed to participate pending shareholder approval.
Looking Ahead
The scoping study is targeted for completion in the fourth quarter of 2025. Subject to positive outcomes, Kalamazoo plans to immediately advance to a pre-feasibility study, alongside ongoing resource growth drilling and further pit optimisations. The company is also maintaining proactive engagement with stakeholders and regulators to facilitate smooth project progression.
With the Ashburton Gold Project now fully under its control and supported by a robust gold price environment, Kalamazoo is well-positioned to emerge as a compelling gold developer on the ASX.
Bottom Line?
Kalamazoo’s accelerated development plans and full ownership of Ashburton set the stage for a potential re-rating as the scoping study unfolds.
Questions in the middle?
- Will the scoping study confirm robust economics to justify rapid project advancement?
- How will Kalamazoo finance subsequent development stages beyond the current placement?
- What exploration upside remains to extend the Ashburton Gold Project’s mine life?