RXL 1.32% 38.5¢ rox resources limited

Rox unveils its Younami pathway to production

  1. 8,931 Posts.
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    Needed a new thread because, as is often the case Rox, buries its important news.
    Rox has chosen a small startup low Capex route to production that will be closer than expected.
    In the end, Rox had 2 choices:
    (1) A big 2- 3 Mtpa + operation, high Capex of + $230m based on a large, low overall grade inventory, producing around 160 kozpa of gold for ten years +.
    (2) A small scale low capex plant based on a high-grade +7g/t inventory with a relatively high AISC producing around 80 kozpa for 10 - 15 years (?) needing a low Capex 300ktpa plant costing approx A$60m inc the low pressure POX.

    The Capex hurdle for (1) was always going to challenging for Rox and represented a risk. Would Rox produce a DFS and be left stranded without finance for the mine?
    The timeline for the big Younami mine was always going to be lengthy because the DFS was so complicated. First pour in 2024 did not impress investors as witnessed by the low SP.
    The small scale low Capex plant was originally going to be used to for the high grade Grace ore (109,000 oz au) but while Grace is a valuable resource it isn't big enough to sustain even a small scale plant.
    So the plan now is to use the low Capex concept to mine the Younami Deeps.
    While the Deeps is currently 657,000 oz @ 8.5 g/t (indicated and inferred) the Deeps Project taking in the fault blocks Block 1 Pollard, 2 Main and 3 Hill End is much bigger. Because these new discoveries are not yet JORC compliant Rox doesn't include them.
    IMO reasonable to think that there will be 1m+ high grade ozs of gold in the Deeps Project.
    AISC is a guess but I would think around $1,500. Perhaps they will mix in the low AISC Grace ore ($700 oz au) to lower that?
    The AISC margin should be no less than $900 oz au at the current POG.
    That generates $72m PA of which Rox gets 70%..
    This low Capex decision also brings forward first production, but it's hard to speculate on a date without seeing if Rox can meet its current timelines, eg upgraded JORC in Q1 next year.
    Rox has now derisked the Capex obstacle to restarting Younami imo.

    ·

 
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