Nov 11, 2024

Genesis Minerals Hits 7.2m @ 60.0g/t Au at Gwalia Underground Mine, Western Australia

Introduction:

Genesis Minerals (ASX: GMD) (Market Cap: $2.53B | Last Close: $2.24 | Cash, Bullion & Investments: $178M) has reported high-grade gold intercepts from drilling at its Gwalia underground mine in Western Australia, highlighted by 7.2m at 60.0g/t Au. The results support the company's accelerated production growth strategy aimed at reaching 325,000oz per annum.

Top Drill Results:

7.2m @ 60.0g/t Au (Gwalia underground) (UGD3601)
4.2m @ 37.8g/t Au (Gwalia underground) (UGD3037)
6.3m @ 22.6g/t Au (Gwalia underground) (UGD3036)
13.5m @ 9.0g/t Au (Gwalia underground) (UGD3553)
19m @ 8.0g/t Au (Admiral open pit) (CLGC_430_0142)‍
5.3m @ 8.8g/t Au (Hub open pit)

Project Overview:

Genesis Minerals holds a dominant position in the prolific Leonora / Laverton District of Western Australia. The company's assets include the Gwalia underground mine, Admiral and Hub open pit mines, and the Aphrodite deposit. The Gwalia mine is located 3km south of Leonora and represents a cornerstone asset for the company.

The company's total Mineral Resources stand at 15.2Moz, with current Ore Reserves of 3.3Moz. This significant gap between Resources and Reserves presents multiple opportunities for organic growth and production increases.

Program Details:

Recent drilling has focused on infilling the "Heart of Gold" at Gwalia, as well as testing extensions both laterally and at depth. At Admiral, infill drilling has returned high-grade, thick intercepts that will feed into the immediate mine plan. Hub drilling has successfully identified high-grade plunge over significant strike to the south of the main deposit. Initial work has also commenced at the Aphrodite deposit, testing gaps in the existing Resource and potential extensions.

Understanding These Results:

The high-grade intercepts at Gwalia, including 7.2m @ 60.0g/t Au, demonstrate the exceptional grade potential of the deposit and support the mine plan well beyond the FY30 stoping envelope. Results cover approximately 300m down dip below the current stoping front, underpinning the next ~7 years of production.

At Admiral, results like 19m @ 8.0g/t Au confirm a significant increase in grade as mining progresses, rising to 3g/t at the base of the planned pit compared to 1.3g/t to date. Hub results, including 5.3m @ 8.8g/t Au, confirm potential for a future underground mine below the current open pit.

Management Commentary:

Genesis Managing Director Raleigh Finlayson stated:

“Organic growth is at the centre of our strategy to maximise shareholder returns. These strong drilling results support that strategy because they demonstrate the scope to steadily convert Resources to Reserves over the five-year growth plan.

“This will make our mine plans even more robust, paving the way for higher mined grades and increased mining rates, all of which will help accelerate the planned organic growth to 325,000oz and beyond.

“As a result, we not only deliver rapid growth in production and cashflow, but we also future-proof our operations in a way which reduces risk while increasing returns.

“Genesis has a pipeline of strong organic growth opportunities, some of which have potential to be realised in a timeframe which would accelerate our growth plan. Others, such as the Westralia deposit at Laverton, currently sit outside the growth schedule altogether.

“Given the upside at Westralia, we are re-modelling the deposit and its potential to host an open pit operation, followed by plans for a close-spaced drilling program and more detailed economic assessment”.

Next Steps & Catalysts:

Drilling is ongoing at Gwalia with two rigs, focusing on infilling known lodes and testing for extensions. At Admiral, resource drilling will recommence to test for extensions to known mineralization. Future drilling at Hub will infill the southern high-grade shoot for Resource estimation purposes.

The company is also re-evaluating the Westralia deposit as a potential bulk open pit opportunity, which could unlock significant value from this +1Moz gold deposit. Upcoming drilling is planned at Jupiter open pit and the Maritiema prospect near Laverton.

Commodity Outlook:

Gold serves multiple markets, including investment assets, central bank reserves, jewellery manufacturing and industrial applications in electronics. Currently trading at US$2,667.19/oz (November 7, 2024), the metal has experienced record highs in 2024 despite recent volatility linked to U.S. political shifts and Federal Reserve policy expectations.

Long-term market dynamics continue to be shaped by central bank purchasing programs, investment demand for safe-haven assets, and consistent jewellery consumption from Asian markets. This improved price environment, coupled with the company's lean mining approach, supports the potential for unlocking additional value from existing Resources.

Conclusion:

The latest drilling results from Genesis Minerals support its "ASPIRE 400" accelerated growth strategy, demonstrating potential to increase Reserves and underpin higher production rates. With multiple organic growth opportunities across its asset base, Genesis is positioning itself in efforts to achieve its 325,000oz per annum production target.

Sources:

GMD Drill Results Announcement

Additional Figures:

Australia

ASX

Gold

Nov 2, 2024