Rumble’s Western Queen South Scoping Study Shows A$112M NPV and 370% IRR

A Compelling Underground Opportunity

Rumble Resources Limited (ASX, RTR) has released a detailed Scoping Study for its Western Queen South underground gold project in Western Australia, painting a picture of a robust mining operation with attractive economics and a swift path to production. The study, conducted by independent consultants Baybridge Mining Services, focuses on mining a portion of the Western Queen South resource, targeting 58,500 ounces of gold from 617,000 tonnes of ore at an average grade of 2.95 grams per tonne.

What stands out is the relatively low upfront capital expenditure, estimated at less than A$10 million, which supports a rapid project start-up with first ore expected within six months of decline development. This positions Western Queen South as a potentially nimble and cash-generative underground mine in a region with established infrastructure.

Strong Financial Metrics Underpin Confidence

The project economics are compelling, with a net present value (NPV) of A$112 million at an 8% discount rate and an internal rate of return (IRR) of 370%, assuming a gold price of A$5,540 per ounce. Operating costs are estimated at A$2,970 per ounce, which is competitive within the Western Australian gold mining sector. The study’s financial model incorporates a conservative approach, including a 20% contingency on costs and sensitivity analyses that demonstrate resilience to fluctuations in gold price, grade, and operating expenses.

Importantly, the study’s production target includes 66% Indicated and 34% Inferred Mineral Resources, reflecting a degree of geological uncertainty. No Ore Reserves have been declared at this stage, underscoring the preliminary nature of the assessment and the need for further drilling and commercial agreements.

Strategic Processing and Infrastructure Plans

Rumble plans to toll treat the ore at Gylden Resources’ Kirkalocka processing plant, located approximately 180 kilometres southeast of Western Queen. The plant is scheduled to resume operations in the second half of 2026 following refurbishment. While a draft ore tolling agreement has been provided, no binding commercial contracts are yet in place, representing a key milestone for the project’s advancement.

The Western Queen project benefits from proximity to multiple processing facilities within 200 kilometres, providing flexibility and potential cost advantages. The company is actively negotiating processing arrangements and progressing regulatory approvals for underground mining, having already submitted relevant documentation to government departments.

Exploration Upside and Tungsten Potential

Alongside the underground gold mining plans, Rumble is conducting a 20,000-metre diamond drilling program aimed at upgrading the resource classification from Inferred to Indicated and extending mineralisation at both Western Queen South and Central deposits. This could significantly enhance the mine life and production profile.

Additionally, the project hosts tungsten mineralisation near the gold zones. Metallurgical testwork is underway to evaluate the potential for a valuable tungsten co-product revenue stream, which could diversify and strengthen the project’s economics in the near term.

Cautious Optimism Amidst Early-Stage Risks

While the Scoping Study presents a promising foundation, it remains a preliminary technical and economic assessment with an accuracy of +/-30%. The absence of Ore Reserves and binding commercial agreements means that further work is essential to confirm economic viability. Funding assumptions have not been finalized, and the company acknowledges the risks associated with securing capital and executing processing contracts.

Nevertheless, Rumble’s management expresses confidence in the project’s potential, highlighting the relatively small capital requirement, strong cash flow forecasts, and strategic location within a prolific gold-producing region.