Firefinch on track to reviving ‘Morila the Gorilla’ after record June Quarter

ASX-listed gold miner Firefinch is going full throttle in its bid to return the Morila gold mine in Mali to its status as “Morila the Gorilla” after confirming a new life of mine plan in the June Quarter.

The 7.5Moz African gold mine earned the nickname during the early 2000s when it was one of the world’s biggest gold producers at grades upwards of 10g/t.

Firefinch (ASX:FFX) scored record quarterly production under its ownership from Morila of 12,555oz, at the upper end of its 11,000-13,000oz guidance range.

But that is just the tip of the iceberg, with the bulk of production until now coming from retreating low grade tailings.

Firefinch has recently restarted mined production at satellite pits at Morila Pit 5 in April, which along with the recommissioning of the comminution circuit drove process plant recoveries up from 50-75%, with the Viper pit to enter production soon.

But the endgame is the revival of the Morila Super Pit, the mainstay of the operations and centrepiece of a plan to increase gold production from current levels of ~50,000ozpa to 200,000ozpa with a long term average of 160,000ozpa between 2022 and 2030.

Its current seven-year life of mine reserve includes 23.8 million tonnes at 1.40g/t gold for 1.07 million ounces and All In Sustaining Costs of US$1124/oz, which would generate margins of US$600-700/oz at recent gold prices.

The dewatering of the Morila pit is ongoing and remains ahead of schedule, the company said.

A mining contract for the first phase of mining at Morila, scheduled for Q1 2022, was awarded during the quarter to international mining contractor Mota-Engil and Mali’s Inter-Mining Services.

Raisings and Goulamina spinoff set platform for growth

Firefinch raised $47 million in an oversubscribed placement in June to progress Morila.

With $61.8 million in the bank it is well stocked to keep up the pace with its revival of the operations and is at the due diligence stage with a preferred financier for around US$50 million in debt funding.

But it has also made significant moves at its other major Malian project, the world-scale Goulamina Lithium mine.

The company secured the support of Chinese lithium behemoth Ganfeng in a deal that will give Ganfeng a 50 per cent stake in the operation by providing US$130 million in equity funding and sourcing between US$40-64 million in debt funding to bring the project into production.

Once the JV is finalised Firefinch will spin out its Goulamina interest into a new ASX-listed vehicle that will create two pure play investments in gold and lithium for shareholders.

Once supporting documents for the Ganfeng transaction are finalised and conditions on the deal are satisfied, the first US$39 million tranche of equity funding will be delivered, enabling detailed engineering and long lead items to be ordered.

The final US$91 million tranche will be delivered on a final investment decision, with the mine currently expected to produce 436,000t of hard rock spodumene concentrate over a 23-year mine life.

Morila production to rise again in September quarter

Production from the Morila gold mine is set to rise again in the September Quarter to 13,000-15,000oz, with contractors set to mobilise to the Viper and N’Tolia deposits in August.

The Viper mineral resource increased from 0.96Mt 1.39g/t gold for 43,000oz to 1.55Mt at 1.05g/t gold for 52,000oz, with 51,000oz in the measured and indicated categories.

Located 28km from Morila, more resource definition drilling is planned at Viper on the back of results from a 54-hole, 6459m drilling program in the June Quarter which highlighted impressive shallow intercepts including 6m at 11.34g/t from 74m and 9m at 6.78g/t from 54m.

Drilling outlined maiden mineral resource estimates at Morila Pit 5 and Koting, and updated the existing N’Tolia resource from 1.13Mt at 1.25g/t gold for 45,000oz to 2.43Mt at 1.04g/t for 81,000oz.

It also made the K3 South discovery near Koting, including the best gold intersection drilled by Firefinch at the Morila or Massigui gold projects of 21m at 13.45g/t from 110m, including high grade zones of 46.5g/t and 16.1g/t.

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.