Boab Metals Commits A$12.5M to Acquire 100% of Sorby Hills Silver-Lead Project
Boab Metals has exercised its option to acquire 100% ownership of the Sorby Hills Silver-Lead Project, fully funding the venture and targeting first production in the second half of 2027.
- Acquisition of Yuguang’s 25% stake for A$12.5 million plus deferred payments
- Boab now holds 100% ownership and sales rights for Sorby Hills concentrate
- Project fully funded following recent capital raises
- Final Investment Decision made, transitioning to construction phase
- First production targeted for H2 2027 with strong silver and lead market outlook
Full Ownership Secured
Boab Metals Limited has taken a decisive step forward by exercising its option to acquire the remaining 25% interest in the Sorby Hills Silver-Lead Project from Yuguang (Australia) Pty Ltd. This move grants Boab full ownership of the project, consolidating control over one of Western Australia’s promising base and precious metals assets.
The acquisition involves an upfront payment of A$12.5 million, supplemented by deferred payments totaling A$10.5 million spread over the next 18 months following the commencement of concentrate production. This structured payment approach aligns with the project’s operational timeline and cash flow generation.
Fully Funded and Ready to Build
Importantly, Boab confirms that the recent capital raised during the quarter was secured on a 100% ownership basis, meaning the company has no immediate need for additional funding to complete the acquisition or advance the project. This financial clarity provides a solid foundation as Boab transitions from development to construction.
The company has also announced a Final Investment Decision (FID) on Sorby Hills, signaling confidence in the project’s economics and readiness to move forward. With all financing in place, Boab is targeting first concentrate production in the second half of 2027, a timeline that positions the company to capitalise on favourable market conditions for silver and lead.
Market Exposure and Shareholder Value
Owning 100% of Sorby Hills means Boab will have exclusive rights to sell the forecast 897,000 tonnes of concentrate containing 18.6 million ounces of silver and 575,000 tonnes of lead. This full exposure enhances shareholder value by capturing the entire upside from operating margins, which are benefiting from silver prices that have more than doubled since the company’s initial feasibility studies.
Managing Director Simon Noon acknowledged Yuguang’s valuable partnership over the past seven years, highlighting the collaborative effort that brought the project to this pivotal stage. With the transition to sole ownership, Boab is poised to streamline decision-making and fully leverage the project’s potential.
Strategic Location and Logistics
Located in the East Kimberley region, approximately 50 kilometres from Kununurra, Sorby Hills benefits from excellent infrastructure, including sealed roads facilitating concentrate transport to Wyndham Port, 150 kilometres away. This logistical advantage supports efficient operations and cost management as the project ramps up.
As Boab moves into construction and prepares for production, the company’s focus will be on delivering on its promises to shareholders and capitalising on the robust fundamentals underpinning silver and lead markets.
Bottom Line?
Boab’s full ownership of Sorby Hills sets the stage for a critical growth phase, with production and market dynamics to watch closely.
Questions in the middle?
- How will deferred payments impact Boab’s cash flow once production begins?
- What are the company’s plans to mitigate potential commodity price volatility?
- How will Boab manage operational risks during the transition from construction to production?
