Study Validates Nine-Year Gold Operation in WA
The 100% owned Lady Julie Gold Project (LJGP) run by Magnetic Resources NL, also known as MAU on the Australian Securities Exchange, is at an end stage in a Feasibility Study. The site is in the Eastern Goldfields, 17 kilometres south west of Laverton, Western Australia.
The analysis notes a free-standing development that will use a total of nine years; the average annual production of which is expected to be 140,000 ounces. LJGP has a life of producing 1.02 million ounces.
Financial Metrics Show Strong Viability
A base case gold price of A$4,000 per ounce provided a pre-tax Net Present Value (NPV) of A$970 million, calculated by Magnetic Resources. The IRR is 45%.
The calculation of NPV in its pre-tax calculation with an A$5,145 per ounce price of gold brings the figure up to A$1.67 billion with the IRR raising to 66%.
Earnings before interest, tax, depreciation and amortisation (EBITDA) is A$2.23 billion. The average All-in-Sustaining Cost (AISC) is at A$1,908 per ounce.
The total initial capital cost comes in at A$375 million and payback should be about 30 months. With the current gold price, payback is reduced to 21 months.
Idealised section through the LJN4 showing the starter pit and cutbacks
Mining Reserve and Resource Base
The project has released its maiden Mining Reserve of 18 million tonnes at 1.72g/t, containing 997,300 ounces of gold.
This includes 15.9 million tonnes of open pit ore at 1.57g/t and 2.1 million tonnes of underground ore at 2.87g/t.
An additional inferred mineral resource of 3.3 million tonnes at 2.64g/t containing 287,000 ounces has not been included in the current design.
Managing Director George Sakalidis said, “This excellent outcome demonstrates that Magnetic’s Lady Julie Gold Project is one of the highest margin undeveloped gold projects in Australia.”
Project Components and Timeline
The site will host three open pit mines: Lady Julie North 4 (LJN4), Lady Julie Central (LJC), and Hawks Nest 9 (HN9). LJN4 will also feature an underground mine.
A 2.75Mtpa processing plant, a 20MW gas/solar hybrid power station, and bore fields for process water are planned.
The workforce will operate on a fly-in fly-out basis from a 300-person camp in Laverton. Construction will take nearly two years.
Key milestones include site clearing in March 2026, plant construction completion in June 2027, and commercial production by July 2027.
LJPG proposed site layout
Production Schedule and Infrastructure
Ore processing will begin with LJC, followed by LJN4 and HN9. Underground mining at LJN4 will begin in year two.
Gold production is scheduled to peak in years 4–7, with yearly outputs above 140,000 ounces.
A temporary 100-bed camp will support early works. A permanent accommodation facility is also being planned, supported by Laverton Shire Council.
CAPEX and Cost Structure
The A$375 million capital estimate includes A$328 million in direct costs and A$47 million in working capital.
Major capital allocations include A$139 million for the process plant, A$89 million for the mobile fleet, and A$33 million for earthworks.
The Company anticipates sustaining capital of A$101 million during operations.
Processing Optimisation
Test work identified gold entrained in sulphides in parts of LJN4. Magnetic revised the processing method to include flotation and fine grinding, increasing recovery from 88% to 91.9%.
Operational Planning and Execution
Magnetic Resources (ASX:MAU) will adopt an owner-managed delivery model. Stuart Gula has been appointed Project Director, bringing over 30 years of experience.
Key tasks underway include recruitment, finalising funding plans, and early engineering for long lead items.
Also Read: Agrimin Advances Strategic Efforts at Mackay Potash and West Arunta Projects
Sensitivity Analysis and Market Leverage
NPV shows the greatest sensitivity to gold prices, contained metal, and process recovery. Gold price shifts of ±A$400 result in major changes to project economics.
The current AISC positions LJGP in the lower half of the global cost curve, improving its resilience.
Regulatory and Indigenous Engagement
A Native Title Agreement with the Nyalpa Pirniku people has been signed. magnetic Mining lease applications and environmental approvals are underway.
Sakalidis added, “The Board remains open to all options to deliver value for our shareholders, but it is now increasingly focused on executing a stand-alone development as magnetic the primary pathway.”
Conclusion
With solid financials, defined reserves, and regulatory magnetic progress, LJGP now shifts focus from exploration to construction. Magnetic Resources is positioned to become a competitive gold producer in Western Australia.
