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Auric Mining expands gold reserves by 51% with bargain acquisition of Union Jack project

Company snaps up 102,000-ounce resource near Coolgardie for $9.5 million in cash and shares

By LineZotpaper
Published
Read Time2 min
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Auric Mining has completed the acquisition of the Union Jack gold project near Coolgardie in Western Australia, boosting its total mineral resource inventory by 51 per cent to 301,000 ounces of shallow, open-pitable gold resources.

The company settled the purchase of the granted mining lease for $6.5 million in cash and $3 million in shares, bringing the 102,000-ounce resource into its portfolio. The Union Jack project sits just 15 kilometres from Auric's planned Burbanks processing hub, making it a strategic addition.

The Union Jack resource currently stands at 3.12 million tonnes grading 1.02 grams per tonne (g/t) gold, with a history of strong drill results. Previous intercepts included 17 metres grading 4.57g/t from a depth of 24 metres and high-grade hits up to 5 metres going 12.21g/t gold from 56 metres. Auric plans to begin infill and extensional drilling early next month.

Auric Mining managing director Mark English said: "There was simply no way we could pass on such a strategic purchase, including adding to the ounces we already control in the region."

The Burbanks plant, 20 kilometres south of Coolgardie, was acquired in late 2024 for $4.4 million. Auric plans to expand its capacity from 180,000 tonnes per annum to 600,000 tpa. The company recently purchased a package of processing infrastructure for $1.2 million, which management says would have cost $15 million to $20 million if bought new.

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Analysis

Why This Matters

  • The acquisition expands Auric's gold resource base significantly, positioning it for future production growth.
  • The low-cost acquisition strategy (under $10 million total) could enhance shareholder value if gold prices remain favourable.
  • The proximity to the Burbanks processing hub reduces transportation costs and operational complexity.

Background

Auric Mining is a Western Australian gold exploration and development company. The company acquired the Burbanks processing plant in late 2024 and has been pursuing a strategy of consolidating nearby resources to feed the plant. The Union Jack project adds shallow, open-pitable ore that can be processed at Burbanks. The company has also secured second-hand processing equipment at a fraction of replacement cost.

Key Perspectives

Auric Mining: Sees the Union Jack acquisition as a strategic, cost-effective way to increase ore supply for the Burbanks plant, with potential for resource growth through drilling. Industry observers: May view the low-cost acquisitions as a savvy approach in a high gold price environment, but would note that exploration success and permitting are needed to convert resources into production. Critics/Skeptics: Might question the company's ability to finance the Burbanks expansion and bring the projects to production, given that both the Union Jack and Burbanks were acquired cheaply, possibly indicating limited prior development.

What to Watch

  • Results from the upcoming infill and extensional drilling campaign at Union Jack, which could further expand the resource.
  • Progress on the Burbanks plant expansion to 600,000 tpa, including securing the necessary equipment and financing.
  • Gold price movements, which directly affect the economics of the projects.

Sources

Zotpaper

Written by software from the reporting listed above, scored by an automated standards desk, and published without a person reading it first. If something here is wrong, tell the editor and it will be put right.

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