Ora Banda Mining Ltd

Primary ticker: ASX:OBM
Stage of development: Exploration, Production
Primary minerals: Gold
Project to promote: The Davyhurst Gold Project with focus on Rivierina Underground & Sand King potenital Underground
Project location: Australia
Website: www.orabandamining.com.au

Ora Banda Mining (ASX: OBM) is a growth company positioned to deliver substantial value to all stakeholders by focusing on fundamentals and operational excellence to drive organic production growth from disciplined and focused exploration targeting over 100Koz in FY25.

Cash: AUD $19.2M

Debt: AUD $11M

Major shareholders:

Hawke’s Point – 37.6%

Paradice Investment Management Pty Ltd – 9.2%

Luke Creagh – 3.7%

Management ownership – 5%

Financials

Management Profile

Luke Creagh, Managing Director

Mr Creagh is a mining engineer with more than 20 years experience working for both contracting and mining companies at projects throughout Australia and overseas. Prior to joining Ora Banda Mining as Managing Director in July 2022, he served as Chief Operating Officer of Northern Star Resources Limited. Prior to becoming COO in 2018, Mr Creagh held various senior positions within Northern Star, including GM Business Development, GM Strategy & Grown and Operations Manager. Before Northern Star, he was the Operations Manager at Barminco Limited.

What is your rationale for taking part 121 Mining Investment?

To raise the company’s profile with sophisticated, specialist gold and institutional investors.

What recent news would you like to highlight to investors attending?

4/4/24 – Riverina & Sand King Update
1/3/24 – A$30m Placement to Advance Sand King Underground
28/2/24 – New High Grade Lode System Discovered at Sand King
15/2/24 – Riverina Update – Ramp Up on Schedule
6/2/24 – Exploration Update – Sand King

All current announcements are on the OBM website: www.orabandamining.com.au

What are your key goals for the next 3, 6 and 12 months?

3 Months:

– Riverina Underground into steady state production:
– Production rate ~600,000ktpa
– Reserve grade of 4.3gpt
– AISC at less than $1,650/oz
– Improved operating performance and cost reductions
– Exploration updates on additional targets
– Sand King Underground update

6 Months:

– Steady state Riverina Underground
– This will take OBM’s headline production to 100,000kozpa (or more) in FY25 and AISC below A$1,750 per ounce
– Further improvements in operations and processing throughputs
– 2nd underground mine
– Investment to extend mine life and focus on greenfield exploration

12 Months:

– With free cash flow increasing, exploration programs will be expanded to target and develop a second underground mine, with potential to bring the Company’s total production above 150,000ozpa off using the current processing infrastructure of 1.2Mpta

What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?

Labour shortages, cost escalation and mine ramp up.

What do you think makes your company such a compelling investment?

Ora Banda Mining (ASX: OBM / Market Capitalisation: ~$600 million) is one of the fastest growing gold companies on the ASX. With its new team and strategy, OBM is rapidly transitioning from open pit mining to high grade underground operations at its Davyhurst Project in Western Australia. Most recently it started producing first ore from its Riverina Underground mine and technical work is well advanced to make a Final Investment Decision on starting a second underground mine at Sand King. Well funded via the recent sale of non-core metal rights into a Joint Venture and a $30 million placement, OBM is rapidly accelerating from being a ~70,000ozpa producer to a >100kozpa producer.

What are the top 3 key investor takeaways?

1. Riverina Underground = New high grade mine now producing

Since the 1980s the various owners of the Davyhurst tenement package had predominantly focused on immediate, open pit production with limited attention to exploration or pursuing underground options. Consequently, in FY23 OBM changed strategy and went back to basics: structural mapping of key deposits and >$10m of exploration and resource development drilling designed to identify potential high grade underground opportunities.

OBM’s boots-on-the-ground approach immediately pointed to Riverina as a first exploration priority and hence OBM started extensional underground drilling to a small, known resource at Riverina in August 2022.

The results were immediate and impressive with drilling confirming high-grade extensions of the Main Lode (East and West) and the Murchison Lode. The drilling was important because it extended Riverina’s high-grade mineralisation more than 100m to the south and 250m vertically. It has also doubled the depth of known mineralisation from 240m to 480m and the deposit still remains open in all directions.

OBM swiftly moved to capitalise on its exploration success and within 12 months of changing strategy had discovered, approved, financed and commenced mining at Riverina Underground. Processing of this material has begun at the Davyhurst plant.

More drilling is planned at Riverina Underground and the company’s expectation is that the discovery will continue to grow into a multi-year feed source. Crucially, Riverina’s high grade material (>4g/t) is beginning to improve OBM’s gold output profile and at the same time help drive down costs.

2. Sand King = Recent discovery points to second underground mine

A second priority target identified by OBM for high grade underground ore was the Siberia Complex which comprises of six deposits with a combined gold endowment of 750,000oz.

One of the deposits, Sand King, was previously mined by Western Mining Corporation in the late 1980s to 1991 by open pit methods. A small cutback to the south was started in August 2023 and completed in January 2024 by OBM. But the real prize was always thought to be potential high grade mineralisation under the pit.

Consequently OBM launched a 33-hole program to test depth extensions at Sand King. On 6 February the Company announced 30 of those holes had been completed and assays for the first 17 holes had returned outstanding intercepts that demonstrate widths and grades conducive to underground mining.

The Sand King system has now been extended to 1km of strike and 300 metres below surface and remains open in all directions. Encouraged by what it was seeing in Phase 1, OBM has moved to accelerate its understanding of Sand King by rolling into a Phase 2 drilling program at a cost of $2 million.

If successful, this drilling could prove to be a game changer for the Company, as it will form the foundation for pressing the button on a second underground mine. If achieved, then the business will be in a step change position whereby the 1.2Mtpa Davyhurst process plant will be full of high grade ore and the Company’s production rate will increase substantially beyond the current 100,000ozpa target.

3. Well Funded = $30M JV deal and $30M placement means OBM is positioned to deliver

OBM is well funded to execute on its growth strategy following the formation of a lithium focused joint venture with WesCEF (Wesfarmers) in 2023, a deal that included a $30 million cash payment to OBM and which contains upside exposure to future exploration work.

This deal was followed by a $30 million share placement in March 2024 to new and existing, international and domestic institutions. The well supported placement has allowed OBM to rapidly advance Sand King toward FID as a second underground mine and begin accelerating regional exploration across the Company’s 1070km2 land holding.

In addition to this, as Riverina Underground ramps up to commercial production in the June quarter of FY24, the Company will generate strong cashflows to further support exploration and growth opportunities.