Firing on All Cylinders : An Update based on a May 2018 Visit to IRC's Teal & Goongarrie Projects
Research Report Completed by Keith Goode at ERA
Intermin has a target route to become a ~100kozpa gold producer with a >5 year mine-life, by using the stepping stones of small mining projects (SMPs) to self-finance its exploration, and has displayed its capability to achieve that with its very successful oxide mining of Teal realising ~3.5koz higher gold production at 21.84koz, mostly from ~13% higher ore tonnes mined and 5% higher recoveries of 93.6%, which increased the expected revenue of $29.3m by 24% or $7.2m to $36.5m. The actual profit (>$8m?) is expected to be finalised in SQ 2018, with its operational JV partner claiming alternative cost variations.
Intermin is currently rated by ERA as a SPEC BUY at 17c, with a target of >A$0.25.
The key points from the visit and recent announcements are :
- The SMP over Teal has been extremely successful, with a larger resource mined, better recoveries and higher profits than expected, and has increased IRC's confidence in advancing the next 3 prospects in the pipeline (Goongarrie Lady, Jacques-Peyes, and Anthill) through to mining, treatment and profitability.
- Apart from Goongarrie Lady, the proposed production pipeline order of the projects/prospects is not "set in stone" and could change, especially if one prospect infers potentially better return characteristics, as illustrated by the Crake discovery joining the mix.
- The results from the feasibility study on Goongarrie Lady were reported on 28 June 2018, with an expected free cashflow return of $5 to $7m over 7 months, possibly pre-strip mining in MQ 2019.
- The Crake discovery in the Binduli tenements resulted from Evolution ending its JV farm-in and handing control back to Intermin who were then able to drill/explore where they wanted to, with IRC's first target (Crake) being on strike of Janet Ivy (where Zijin is mining & paying a 50c/t royalty).
- There are a number of projects making steady progress such as Blister Dam and Baden Powell/Olympia, and the tenement package is increasing with Ida and Lakewood in Figure 1a(see link below).
- In addition to the JVs mostly involving other companies farming-in, as shown in "blue" in Figure 1b(see link below), Intermin has its Richmond Vanadium JV in QLD, which has also been making steady progress.
To view the full report with figures, please visit:
About Intermin Resources Limited
Intermin Resources Limited (ASX:IRC) is a gold exploration and mining company focussed on the Kalgoorlie and Menzies areas of Western Australia which are host to some of Australia's richest gold deposits. The Company is developing a mining pipeline of projects to generate cash and self-fund aggressive exploration, mine developments and further acquisitions. The Teal gold mine has been recently completed.
Intermin is aiming to significantly grow its JORC-Compliant Mineral Resources, complete definitive feasibility studies on core high grade open cut and underground projects and build a sustainable development pipeline.
Intermin has a number of joint ventures in place across multiple commodities and regions of Australia providing exposure to Vanadium, Copper, PGE's, Gold and Nickel/Cobalt. Our quality joint venture partners are earning in to our project areas by spending over $20 million over 5 years enabling focus on the gold business while maintaining upside leverage.
Intermin Resources Limited