Monsters of Rock: As ASX gold stocks founder, revival of historic mine is bringing at least some good vibes
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Here’s a trivia question for your next investment themed trivia night – between 1935 and 2014 what was the longest running gold mine in Australia?
If you had Norseman on your lips you’d be correct.
Located in a town 200km south of Kalgoorlie, named after the horse that by legend kicked over the first gold nugget back in the 1890s, the mine eventually shut due to financial troubles.
It sat idle in the portfolio of London-registered Norseman Gold PLC, but has reemerged since Kevin Maloney and his Tulla Group sold half of the mine to junior goldie Pantoro (ASX:PNR) a few years ago.
Both Pantoro and Tulla (ASX:TUL), now listed on the ASX, defied a disastrous day for gold stocks on the ASX after announcing the project remained on time and on budget for its planned revival in August this year.
Pantoro and Tulla were a sanctuary for gold investors on the ASX today.
The ASX All Ordinaries Gold Index was down a shocking 6.53%, led by a calamitous day for Australia’s third largest gold miner Evolution Mining (ASX:EVN), which foundered on a major downgrade to its three-year production guidance.
Pantoro was up early before pulling back to an even day, a positive outcome in the context of the broader market.
$82 million capped Tulla rose 10.1% as of 3.10pm AEST.
As Evolution said it would defer a decision on a plant expansion at its Mungari mine near Kal due to WA’s crazy construction market, Pantoro said a new 1Mtpa processing plant at Norseman was progressing in line with its budget despite Covid cases.
The company said its decision to procure components during the approvals process had expedited construction times and shielded the JV partners from inflationary pressure.
The mine contains a 900,000oz ore reserve within a broader 4.7Moz resource and has produced 5.5Moz across its history.
An initial seven-year mine plan will produce around 108,000ozpa from open pit and underground sources, with mining already underway at the Scotia and Green Lantern mines and underground prep work progressing at the OK mine ahead of development activities next month.
While gold was a drag, other mining sectors did the heavy lifting today, with higher iron ore prices flowing through to major gains from the Pilbara giants.
Lithium stocks also continued a rebound they started late last week with miners of critical minerals heavily bought among large and small caps alike.
The materials sector joined in a major bounce across the ASX today, rising 1.89% with energy stocks lifting 2.75%.