Funding and Geotechnical Risks Loom as Manuka Advances Mt Boppy Gold Cutback
Manuka Resources has declared a maiden Probable Ore Reserve of 39,000 ounces of gold at its historic Mt Boppy Open Pit, underpinning a cutback project that adds significant value to its Cobar Basin production plan.
- Maiden Mt Boppy Open Pit Ore Reserve of 290kt at 4.2g/t Au
- Additional 39,000oz gold integrated into Cobar Basin plan
- Cutback project delivers pre-tax NPV8 of A$43.2M and IRR of 64%
- Ore to be processed at existing Wonawinta plant alongside silver ore
- Exploration targeting near-pit and greenfields high-grade mineralisation
Historic Gold Mine Reinvigorated
Manuka Resources Limited has announced a significant milestone with the declaration of a maiden Probable Ore Reserve at the Mt Boppy Open Pit in New South Wales. Once one of the richest gold mines in the state, Mt Boppy historically produced around 500,000 ounces of gold at an impressive grade of approximately 15 grams per tonne. The new Ore Reserve comprises 290,000 tonnes at 4.2 grams per tonne gold, equating to roughly 39,000 ounces, which will be accessed through a proposed cutback of the existing open pit.
Strategic Integration into Cobar Basin Production
This addition bolsters Manuka’s broader Cobar Basin production strategy, which now includes 19 million ounces of silver and 47,000 ounces of gold. The Mt Boppy ore will be hauled 150 kilometres to the company’s existing Wonawinta Processing Plant, where it will be processed alongside silver-bearing ore from other open pits. The cutback project, evaluated through a detailed pre-feasibility study, delivers a robust pre-tax net present value (NPV8) of A$43.2 million and an internal rate of return (IRR) of 64%, highlighting its economic attractiveness.
Operational and Financial Flexibility
Manuka retains flexibility in funding the cutback, with options including free cash flow from ongoing operations, debt financing, or joint venture/profit share arrangements. The company is progressing towards securing binding finance terms within the current quarter, supported by a recently announced A$8 million underwritten entitlement offer. Operational plans envisage mining predominantly waste material initially, ramping up to high-grade ore extraction over a 19-month period, with a mining fleet operated under a dry hire model.
Robust Technical and Environmental Foundations
The Ore Reserve is supported by a comprehensive pre-feasibility study incorporating updated mineral resource estimates, geotechnical assessments, and metallurgical test work. Gold recoveries are expected between 69% and 79% based on historical processing data. Environmental and regulatory approvals are in place, including mining leases and native title agreements, with detailed plans to manage potentially acid-forming waste rock. Infrastructure at Mt Boppy includes grid power, water supply, road access, and accommodation facilities, with planned upgrades to support the cutback.
Exploration Upside and Future Growth Potential
Beyond the declared Ore Reserve, Manuka is actively targeting near-pit and greenfields exploration opportunities. Geological interpretations suggest that Mt Boppy is part of a broader mineralised system associated with regional volcanic activity and structural controls. Upcoming drilling campaigns aim to test extensions at depth and along strike, potentially expanding the resource base and further enhancing the project’s value.
Bottom Line?
Manuka’s Mt Boppy cutback project marks a pivotal step in expanding its gold footprint, with funding and exploration developments set to shape the next phase.
Questions in the middle?
- When will Manuka finalize financing to commence the Mt Boppy cutback?
- What are the key geotechnical risks that could impact mining schedules?
- How might fluctuations in gold prices affect the project’s economic viability?
