Mining Permit Granted but Spot Market Sales Pose Price Risks for GIB
Gibb River Diamonds has received the crucial Mining Proposal Permit for its Neta Gold Prospect, setting the stage for mining operations to begin with equipment mobilisation planned for August 2025.
- Mining Proposal Permit granted for Neta Gold Prospect
- BML Ventures to mobilise equipment in August 2025
- Mining and capital costs fully borne by BML, limiting GIB's financial risk
- Ore processing to utilise existing BML milling contracts
- Neta Prospect holds 24,000 oz gold resource with no forward sales locked in
Permit Approval Clears Final Regulatory Hurdle
Gibb River Diamonds Limited (ASX – GIB) has achieved a significant milestone with the granting of the Mining Proposal Permit (MPP) for its Neta Gold Prospect, part of the Edjudina Gold Project in Western Australia. This approval from the WA Mines Department authorises the company to commence mining activities, marking the culmination of a lengthy regulatory process.
Mobilisation and Mining Operations Set to Begin
Joint venture partner and mining contractor BML Ventures Pty Ltd has indicated plans to mobilise plant and equipment during August 2025. This mobilisation will facilitate ground preparation and logistical arrangements ahead of mining commencement. BML’s involvement is pivotal, as they will manage all mining-related capital and operational costs, effectively insulating Gibb River Diamonds from direct financial exposure.
Ore Processing Strategy and Financial Structure
The preferred approach for processing the Neta ore involves leveraging existing milling contracts held by BML with nearby gold processing plants. While final arrangements are still being confirmed, this strategy is designed to optimise operational efficiency and cost-effectiveness. Financially, after operational costs are reimbursed from cash flow, net surplus proceeds will be split evenly between GIB and BML, providing a clear and balanced revenue-sharing model.
Resource Profile and Market Exposure
The Neta Prospect boasts a JORC-compliant resource of 378,000 tonnes at 1.9 grams per tonne gold, equating to approximately 24,000 ounces of gold. This includes an indicated resource of 110,000 tonnes at 2.2 grams per tonne for 8,000 ounces. Notably, there are no forward sales contracts in place, meaning all production will be sold on the spot market, exposing the project to prevailing gold price fluctuations.
Looking Ahead
With the final permit secured and mobilisation imminent, Gibb River Diamonds is poised to transition from development to production at Edjudina. The company has committed to keeping the market informed as mining operations commence and ore processing arrangements are finalised, underscoring transparency and investor engagement.
Bottom Line?
As Gibb River Diamonds moves toward production, market watchers will keenly observe how operational execution and spot gold prices shape the project’s financial outcomes.
Questions in the middle?
- When exactly will mining operations officially commence following mobilisation?
- What are the finalized terms and locations for ore processing under BML’s milling contracts?
- How will spot market gold price volatility impact the joint venture’s cash flow and profitability?
