Two key developments for gold and lithium hunter Firefinch are drawing closer by the day, as the Mali-focused miner wrapped up another transformative quarter.

Firefinch (ASX:FFX) produced 11,115oz of gold at its Morila operations in the December quarter, the upper end of its 10,000-11,500oz guidance range.

The revival of Firefinch’s Morila Super Pit, once known as Morila the Gorilla for its immense scale and grade, is well under way with pre-stripping and dewatering of the 1.86Moz Morila pit progressing on schedule.

Ore is expected to come from the pit in the second half of 2022, propelling Firefinch well and truly into ASX mid-tier gold producer space with a production rate of 100,000ozpa, rising to 200,000ozpa by 2024.

 

Morila the Gorilla

Mining is currently focused on the Viper satellite pit, where FFX completed an extensive pre-strip to begin hauling to the Morila processing plant after the appointment of two locally based contractors which enabled mining to start ahead of schedule.

With the Morila Pit 5 satellite mine completed in December, mine development activities at the main prize, the Morila Super Pit, are well advanced.

Load and haul operations were on track to commence the first week of January with contractor MEIM Morila SARL mobilising a new fleet of Komatsu 785 trucks to begin the first phase of mining.

Tailings repatriation is expected to start in April 2022 after dewatering of the pit with production in the second half to usher in a step change in the scale of the Morila gold mine.

 

All guns blazing for lithium spin-off, Goulamina

Secondly, Firefinch remains on track to demerge its Leo Lithium business onto the ASX by March 2022, which will jointly develop the Goulamina lithium mine in a US$194 million JV with Chinese lithium giant Ganfeng.

But it is not waiting around until then, detailed engineering has already commenced with the selection of an EPCM contractor in the works.

Site works are escalating with a sterilization drilling program ahead of more drilling to convert inferred resources into ore reserves and early civil works to start in February.

The final investment decision has already been made early this month on the development of the mine, one of the few hard rock lithium projects of scale to come online as lithium demand from EVs and storage explodes in the coming years.

 

Spodumonster

 A new DFS in December gave the project a huge NPV of $4.1bn and post-tax internal rate of return (IRR) of 83%.

It is expected to produce 506,000t of spodumene per annum  initially before ramping up to 831,000tpa in its second stage. That’s a hell of a lot of spodumene.

Firefinch has appointed Simon Hay, the former CEO of trailblazing ASX-listed lithium miner Galaxy Resources to lead the Leo Lithium team as managing director ahead of its planned first production in the first half of 2024.

FFX shareholders will retain exposure to Leo Lithium, with FFX to hold a 20% stake following the demerger.

All Chinese and Malian Government approvals and support have been received for the Goulamina mine to go ahead.

 

A new frontier for gold at Morila

One of the big success stories on the exploration front at Morila has been the discovery of high grade mineralisation to the east of the pit, which historically produced 7.5Moz.

Previous owners though the mineralisation had been offset by a major shear zone, but Firefinch’s drilling has shown this theory didn’t pass muster, with their drillers hitting some top notch grades and widths.

Results from the Morila East drilling include:

  • 0 metres at 30.3g/t gold from 294.6 metres, including 1 metre at 128g/t gold (MRD0026);
  • 90 metres at 35.9g/t gold from 228.2 metres (MRD0026);
  • 15 metres at 31.2g/t gold from 174 metres (MRD0021);
  • 2 metres at 18.1g/t gold from 177.3 metres (MRD0025);
  • 9 metres at 5.60g/t gold from 313.6 metres, within a wider zone of 22.2 metres at 2.24g/t gold from 299.3 metres, including 1 metre at 31.8g/t gold (MRD0025); and ¬ 36.6 metres at 2.01g/t gold from 371.1 metres including 4 metres at 4.24g/t gold and 11.1 metres at 2.94g/t gold (MRD0021).

FFX is well stocked with $146.5 million in the bank as of December 31 after completing a heavily oversubscribed share purchase plan at 58c a share in November, raising $51.36m and $100m institutional placement in December at 67c a share.

FFX has kept up the pace of drilling alongside its development and mining activities at Morila, with three diamond drill rigs and RC rigs working continuously completing 25,367m in 200 holes including almost 8km of diamond drilling.

Outside of the Morila Super Pit exploration and resource definition has been carried out at Viper, N’Tiola and the K3-K4 prospects along with grade control drilling at Voper and Beledjo-Koting.

On the mining front, hard rock mining is ramping up from the Viper satellite pit, delivering more ore from satellite pits to displace low grade hydraulically mined tailings that were the mainstay of the processing operations under recent owners.

Those tonnes reduced from 435,000t in Q1 2021 to 100,000t in Q4, with hydraulic sluicing to end completely by April 2022, in preparation for the start of production in the Morila Super Pit.

Morila is expected to deliver production at the same level in the March quarter of 10,000-11,500oz.

This article was developed in collaboration with Firefinch, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.