Astral Resources’ (ASX:AAR) rapidly developing Mandilla gold project may be its crown jewel, but financial services provider Euroz Hartleys believes the asset is just the start with the stocks’ secondary project – Feysville – boasting the potential to introduce high-grade ounces earlier in the mine plan.

Situated in Western Australia’s mining heartland of the Eastern Goldfields – 70km south of Kalgoorlie – a September 2023 scoping study highlighted Mandilla’s potential to become an exceptionally profitable gold operation.

Using a gold price assumption of A$2,750 per ounce and a five-stage open pit design based on a A$2,100 per ounce pit optimisation, AAR’s scoping study confirmed Mandilla could deliver free cash flows of ~$740m over a life-of-mine of 11 years.

Now, with the gold price sitting around ~$3,700 per ounce, Mandilla’s value proposition absolutely shoots the lights out.

The scoping study demonstrated a payback period of less than a year for total pre-production capital expenditure of ~$191m with a 2.5Mtpa CIL processing plant and associated infrastructure identified as the optimum commercialisation strategy.

Projected annual production of around 100,000ozpa at an average feed grade of 1.30 g/t gold would be achieved over the first 7.4-year period, eventually being reduced to a projected average gold production target of 41,000ozpa at an average grade of 0.50g/t gold.

‘An asset of significance’

But Euroz Hartleys believes recent exploration at AAR’s Feysville asset could introduce high-grade ounces earlier in the mine plan thanks to several satellite orebodies including Rogan Josh, Kamperman and Think Big.

Drilling at Kamperman last year returned thick, high-grade intersections, extending the prospect over a 450m strike with results such as 21m at 4.16 g/t gold from 31m, 35m at 2.19g/t gold from 81m and 5m at 5.89g/t gold from 112m – results the financial services provider believes could further lift the production rate.

Euroz Hartleys says Feysville could eventuate into an asset of significance, with a conservative modelling of 200,000oz of contained gold and an average grade of 2g/t providing a springboard for potential growth at the Feysville prospects.

Big intercepts this close to surface are not only encouraging from a technical perspective, the financial provider says, but they also indicate the presence of large fluid flow – with the next step being to find where this fluid flow has come from.

While Mandilla showcases enormous scale supporting a lower risk start up opportunity with a 10-15m wide orebody, Euroz Hartleys reckons Feysville could add more high-grade material to the project and further improve the NPV. 

What next?

AAR’s exploration focus has now returned to the Theia deposit, the cornerstone of Mandilla, where the first phase of a new infill RC drilling program kicked off in early August.

On completion of the phase one program, Astral will return to Feysville for further infill and extensional RC drilling at Kamperman, as well as follow up on two significant greenfield gold anomalies announced in July 2024 to the north-west of Kamperman.

A maiden resource estimate for Kamperman is scheduled for reporting in the September quarter as part of an updated MRE for the broader Feysville gold project.