Matsa Resources (ASX:MAT) Announces Devon Feasibility Study Surplus
Financial Performance
Matsa Resources Limited has completed a feasibility study for the Devon Pit Gold Mine, projecting a pre-tax surplus of A$59.8 million at a gold price of A$4,250 per ounce. At the current gold spot price of A$4,550 per ounce, the surplus could reach up to A$73.4 million. The study indicates all-in costs of A$2,829 per ounce and positive free cash flow over an 18-month mine life.
Project Details
The Devon Pit Gold Mine is fully permitted and ready for production, expected to commence mining from late Q1 to early Q2 2025. The project involves mining 340kt of ore with a grade of 4.6g/t, yielding 50koz of gold, including 4koz of inferred resources. Capital expenditure is low, estimated at A$3 million, with major infrastructure such as haul roads and accommodation already in place. Mining, processing, and funding arrangements are nearing completion, with further drilling planned to potentially increase the mine’s size and gold output.
Executive Comments
Executive Chairman Paul Poli stated, “We are delighted with the results of the Feasibility Study for the Devon Pit. We have always been confident the shallow high grade nature of the deposit provides a sound foundation to achieving strong returns and the rising gold price environment provides a compelling case for the Company to get this project into production as soon as possible. Devon is a great little project and the projected returns are significantly higher than Matsa’s current market capitalisation. I expect we should see a re-rate of the Company based on these results. At today’s gold price, this project returns twice as much as our current market value. You can now understand why Matsa has been saying that the Company is significantly undervalued. I’m also pleased to add that Matsa is very close to finalising mining, processing and financing arrangements and we hope to be on the ground preparing Devon for mining very shortly.”
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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