Karora to double gold production in Australia by 2024
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(Kitco News) - Karora Resources (TSX: KRR) announced Monday that it plans to double gold production in Australia from 99,249 ounces in 2020 to a range of 185,000 – 205,000 ounces in 2024 at an all-in sustaining cost of US$885 – US$985 per ounce.
The company said that significant expansion of Karora's primary asset, Beta Hunt underground mine, will see underground production increased to 2.0 Mtpa by 2024 through the addition of a second decline.
Increased production from Beta Hunt will be complemented by the Spargos Reward and Higginsville Central areas, with Spargos expected to begin mining ore in Q3 2021.
Additionally, Phase II expansion of Higginsville processing plant will increase throughput to 2.5 Mtpa by 2024, the company added. Meanwhile, Phase I expansion to 1.6 Mtpa from 1.4 Mtpa is currently underway.
Karora noted that its growth plan is organically funded through operating cash flows and current cash balance (end of Q1 2021 - C$76.7 million).
Chairman and CEO Paul Huet commented, "I am extremely pleased to announce our organic growth plan, which includes a three-year ranged guidance profile that is based on Karora's 2020 year-end Mineral Reserves and Mineral Resources announced on December 16, 2020."
“Our new growth plan doubles our ounce output, reduces costs and increases margins over three years. We are in a very strong position to deliver this plan funded from our current cash balance of almost $80 million and cash flow from operations during this period. Based on this robust plan, we also intend to refinance our existing $30 million debt facility to provide us with further flexibility over the coming years along with materially reducing our interest costs," added Huet.
Karora is focused on growing gold production and reducing costs at its integrated Beta Hunt gold mine and Higginsville gold operations in Western Australia. The company also owns the high grade Spargos Reward project which is anticipated to begin mining in the third quarter of 2021.