Navarre’s recently acquired Mt Carlton Operations is already outperforming forecasts following a strong quarterly production report.

The Queensland project produced 14,603oz of gold, 100,781oz of silver and 610t of copper during the December quarter from the processing of 236,672t of underground and open pit ore mined from the V2 orebody.

And if Navarre Minerals (ASX:NML) sustains this for FY22 it places Mt Carlton’s performance above the top end of the vendor’s forecast in August 2021.

Evolution Mining (ASX:EVN), which sold the project to Navarre last year, originally estimated Mt Carlton would produce between 45,000oz to 50,000oz at an all-in sustaining cost (AISC) of between $1,650 and $1,700 per ounce in FY2022.

By way of comparison, gold is currently trading at about US$1,803.8 ($2,506.4) per oz, which could make for some very attractive margins.


Mt Carlton World

Mt Carlton is located 150km south of Townsville and consists of an open pit, underground mine and a 950,000 tonne per annum plant situated on a 815 sq km tenement package.

It produced 58,371oz of gold in FY2021 at an all-in sustaining cost of $1,937 per oz, delivering net mine cash flow of $19.6m in the fourth quarter alone.


Two satellites

Recent drilling by the company has identified the potential for two satellite open pits to deliver significant gold resource growth after returning hits such as 25m grading 21.4 grams per tonne (g/t) gold from 75m and 4m at 46.2g/t gold from 82m at the Delta deposit and 3m at 47.2g/t gold from 81m at the BV7 deposit.

Navarre acquired the project for an upfront consideration of $40m – including up to $20.4m worth of shares in the company.

A further $25m of contingent payments are payable on cumulative gold production milestones from Crush Creek, along with a further $25m in the form of a 5% gold price linked royalty when the spot price exceeds $2,250 per oz in a given quarter.

This article was developed in collaboration with Navarre Minerals, 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.