TRE
Toubani Resources Limited
ASX
Toubani Delivers Highly Attractive Kobada DFS
Sentiment:
Feasibility Study
30 October 2024 6:00 PM
Toubani Resources' definitive feasibility study confirms the Kobada Gold Project in Mali as a highly attractive, large-scale oxide gold project with a post-tax NPV8% of US$635 million and IRR of 58% at a gold price of US$2,200/oz.
Better than expected
The results of the Definitive Feasibility Study were better than expected due to significantly higher than anticipated post-tax NPV and IRR, driven by a combination of higher gold prices and lower than anticipated operating costs.
Summary
- Toubani Resources announced positive results from its Definitive Feasibility Study (DFS) for the Kobada Gold Project in Mali.
- The study confirms Kobada as a significant gold development asset with a large-scale, free-dig, open-pittable oxide resource.
- The Project is projected to produce an average of 162,000 ounces of gold per annum over a 9.2-year mine life.
- The DFS shows highly attractive financial metrics: a post-tax NPV8% of US$635 million and an IRR of 58% at a gold price of US$2,200/oz.
- At a gold price of US$2,600/oz, the post-tax NPV8% increases to US$897 million with an IRR of 73%.
- Initial upfront capital is estimated at US$216 million, including US$18 million in contingency.
- The project has a rapid post-tax payback period of 1.5 years at US$2,200/oz gold (1.25 years at US$2,600/oz).
- All-in Sustaining Costs (AISC) are estimated at US$1,004/oz, and C1 Cash Costs at US$825/oz.
- Toubani has A$10.5 million in cash at bank to advance the project.
- The company plans to commence resource drilling to delineate additional high-margin oxide mineralization and test for depth extensions.
Sentiment
Score: 9
Explanation: The DFS results are exceptionally positive, showing strong financial metrics and a clear path to development. While risks exist, the overall outlook is highly favorable for investors.
Highlights
- Post-tax NPV8% of US$635 million and IRR of 58% at a gold price assumption of US$2,200/oz
- Post-tax NPV8% increasing to US$897 million with an IRR of 73% at US$2,600/oz
- Initial upfront capital of US$216M, including US$18M in contingency
- Rapid post-tax payback period of 1.5 years at US$2,200/oz (1.25 years at US$2,600/oz)
- All-in Sustaining Costs (AISC) of US$1,004/oz and C1 Cash Costs of US$825/oz
- Average annual operating cash flows of US$158M per annum
- Total Ore Reserves of 53.8Mt at 0.90 g/t for 1.56Moz of gold
- 1.26Moz of Oxide Ore Reserves (44.3Mt at 0.88g/t gold)
- Average production of 162,000oz per annum over the current life of mine
- A$10.5M in cash at bank
Positives
- Highly attractive financial metrics with a significant post-tax NPV and IRR.
- Large-scale, high-grade oxide gold resource.
- Low capital intensity compared to other projects in the sector.
- Rapid payback period.
- Strong operating cash flow generation.
- Significant upside potential at current gold prices.
- Well-funded to advance the project.
Negatives
- Uncertainty regarding the final Mining Convention with the State of Mali and its impact on the project's economics.
- Potential risks associated with operating in West Africa.
Risks
- Uncertainty regarding the final Mining Convention with the State of Mali and its impact on the project's economics.
- Potential delays in obtaining necessary permits and approvals.
- Risks associated with operating in a politically unstable region.
- Fluctuations in gold prices and other commodity prices.
- Potential cost overruns and schedule delays.
- Environmental and social risks associated with mining operations.
Future Outlook
Toubani is confident that Kobada will continue to be a highly attractive and robust development project, irrespective of the ultimate fiscal and investment regime applied once the final Mining Convention is determined. The company is well-funded to advance its strategy to position Kobada as development-ready in 2025.
Management Comments
- The strategy to update the Kobada feasibility study was driven by our belief that the Kobada Gold Project is a unique and rare development asset that had yet to reveal its true potential.
- The delivery of the 2024 Kobada Definitive Feasibility Study (DFS) demonstrating Kobada as an asset belonging in the +150,000 ounce per year tier, producing at an initial mine life of over 9 years while at an AISC of just US$1,000/oz, is an exceptional outcome.
- The key attributes of the Kobada Gold Project are the large Mineral Resource of near-surface mineralisation and the free dig and free milling oxide Ore Reserves.
- The economic leverage of a low capital and operating cost project is seen in the financial outcomes of the DFS with a rapid payback of 1.5 years at significantly lower gold prices than today's spot prices.
- While Kobada is clearly strong today, numerous opportunities to enhance the Kobada DFS have been identified and are being pursued to further enhance our already lean capital and operating cost profile, while in parallel our exploration strategy to define additional high-value oxide growth targets to supplement, and potentially increase production, is set to commence.
- Given the strength of the DFS, Toubani is confident that Kobada is a Project that can succeed in West Africa today and looks forward to finalising all in-country agreements with the State of Mali as Toubani readies Kobada for development.
- The 2024 DFS has established an excellent platform for the Company to continue to build momentum with Kobada providing exceptional development asset exposure in the backdrop of a rising gold market.
Industry Context
The announcement positions Toubani Resources favorably within the West African gold mining sector, highlighting Kobada's low capital intensity and strong financial metrics compared to competitors. The focus on oxide gold resources reflects a broader industry trend towards projects with lower upfront capital costs and faster returns.
Next Steps
- Finalising the Mining Convention with the State of Mali.
- Updating the Environmental and Social Impact Assessment (ESIA).
- Commencing resource drilling to delineate additional high-margin oxide mineralization and test for depth extensions.
- Optimizing capital and operating costs.
- Commencing debt funding process.
Key Dates
- July 31, 2015: Mining permit (Permis d'Exploitation) No. PE 15/22 issued to African Gold Group Mali SARL.
- August 16, 2018: Kobada-Est exploration permit (Permis de Recherche) No. PR 18/957 issued to AGG Mali SARL.
- April 6, 2018: Faraba exploration permit No. PR 17/921 issued to AGG Mali SARL.
- August 25, 2021: Kobada Est and Faraba exploration permits renewed.
- October 18, 2021: Environmental permit No. 2021-0045 MEADD-SG issued.
- July 2, 2024: Company's ASX release of the Mineral Resource Estimate for the Kobada Gold Project.
- October 20, 2024: Base date of the CAPEX and OPEX estimate.
- October 31, 2024: Toubani Resources hosts an Investor Webinar to discuss the results of the 2024 Definitive Feasibility Study.
Keywords
Gold, Kobada Gold Project, Mali, Definitive Feasibility Study, Oxide Gold, Mining, West Africa, Financial Metrics, Ore Reserves, Toubani Resources
TRE
Toubani Resources Limited
ASX
Sector: Materials
Filings with Classifications
Capital raise
30 April 2025 2:40 AM
Quarterly Activities Report
- Toubani announced it had received rm commitments to raise A$29 million in a two-tranche placement.
- The placement includes a ~A$15.2m transformational investment by A2MP Investments DMCC (A2MP) a wholly owned subsidiary of Eagle Eye Asset Holdings Pte Ltd. (EEA), (a single-family oce based in Singapore) and supported by the African Export-Import Bank (Afreximbank), one of Africas most prominent multilateral nancial institutions ('Strategic Investment').
- A2MP and Toubani have also executed a non-binding, non-exclusive debt commitment letter for A2MP to provide Toubani with a minimum US$160m debt facility as part of its ongoing debt nancing process.
Capital raise
30 April 2025 2:28 AM
Notice of Annual General Meeting
- The company is seeking approval for a 10% Placement Facility, which would allow them to issue up to 10% of their issued capital in Equity Securities.
- The funds raised from this facility could be used for continued exploration and development activities and/or for general working capital.
Capital raise
29 April 2025 7:33 PM
Capital Raising Announcement
- Toubani Resources is undertaking a two-tranche placement to raise A$29 million.
- The company directors intend to subscribe for an additional A$290,000 subject to shareholder approval.
- A2MP may participate in future capital raisings, subject to negotiation and shareholder approval.
Capital raise
27 April 2025 7:50 PM
Trading Halt Request
- The company intends to make an announcement regarding a proposed strategic partnership and accompanying capital raising.
Capital raise
26 March 2025 1:53 AM
Annual Report
- The company requires additional financing to carry out its exploration and development activities.
- The company is actively strengthening an already impressive asset, reducing uncertainties, and bolstering its readiness for the next steps.
Capital raise
27 January 2025 5:51 PM
Investor Presentation
- The company has appointed Endeavour Financial to lead project financing workstream.
- The company is in discussions with the Mali Government to secure the long-term future of the Kobada Gold Project.
Better than expected
27 January 2025 5:51 PM
Investor Presentation
- The project's low AISC of US$1,004/oz is better than many of its peers.
- The project's rapid payback period of 1.5 years is better than many other gold development projects.
- The project's low initial capital expenditure of US$216 million is better than many other gold development projects of similar scale.
Better than expected
27 January 2025 5:41 PM
Quarterly Activities Report
- The Definitive Feasibility Study results exceeded expectations with a high NPV, IRR, and low payback period.
- The project's low capital intensity and competitive operating costs position it favorably compared to industry standards.
Capital raise
30 October 2024 6:05 PM
Feasibility Study
- The company will need to raise capital to fund the project's development, construction, commissioning, and operation.
Better than expected
30 October 2024 6:05 PM
Feasibility Study
- The project's financial metrics, including NPV, IRR, and payback period, significantly exceeded expectations.
Better than expected
30 October 2024 6:00 PM
Feasibility Study
- The results of the Definitive Feasibility Study were better than expected due to significantly higher than anticipated post-tax NPV and IRR, driven by a combination of higher gold prices and lower than anticipated operating costs.
Delay expected
20 September 2024 4:31 AM
Option Terms and Conditions
- Share issuance may be delayed up to five business days pending receipt of exercise notice, payment, and compliance with the Corporations Act.
Capital raise
8 September 2024 7:18 PM
Investor Presentation
- Tranche 1 & 2 of a placement announced on 21 August 2024, with Tranche 2 subject to shareholder approval in October 2024.
Better than expected
29 July 2024 7:03 PM
Quarterly Activities Report
- The company increased the Kobada Mineral Resource Estimate to 2.0Moz in the Indicated category, a 30% increase from the 2023 MRE.
Capital raise
29 July 2024 7:03 PM
Quarterly Activities Report
- The company has less than 2 quarters of cash available for future operating activities.
- The company will need to raise further cash to fund its operations.
Delay expected
8 July 2024 7:04 PM
Missing type for ID: 4236
- ASX:TRE announces a delay.
Better than expected
1 July 2024 7:09 PM
Mineral Resource Estimate Update
- The 2024 MRE exceeded the Company's expectations in ounces converted and increases in grade.
Capital raise
31 May 2024 2:53 AM
AGM Results
- The company has approval for a 10% placement facility, which allows them to raise capital by issuing new shares.
Better than expected
21 May 2024 7:10 PM
Exploration Update
- The drilling results are better than expected due to the high-grade and wide intersections across multiple areas of the deposit.
Better than expected
29 April 2024 9:32 PM
Quarterly Activities Report
- The initial drill results show numerous near-surface, high-grade oxide intersections, which are better than expected.
Worse than expected
29 April 2024 8:18 PM
Annual Results
- The company reported a loss of $6,625,026, which is worse than the previous year's loss of $5,136,694.
Capital raise
29 April 2024 6:10 PM
Notice of Annual General Meeting
- The company is seeking approval for a 10% Placement Facility, which would allow it to issue equity securities up to 10% of its issued share capital over a 12-month period.
- The funds raised from the potential issue of Equity Securities under the 10% Placement Facility would be used towards continued exploration and development activities and for general working capital.
Capital raise
23 April 2024 7:20 PM
Trading Halt Request
- The company intends to make an announcement regarding a proposed capital raising.
Better than expected
21 April 2024 6:55 PM
Exploration Update
- The document contains better than expected results due to the high-grade gold intercepts reported from the Kobada Gold Project.
Better than expected
10 April 2024 6:22 PM
Exploration Update
- The drilling results are better than expected due to the high-grade and near-surface oxide mineralization encountered.
Worse than expected
25 March 2024 6:05 PM
Annual Results
- The company's net loss increased from the previous year, indicating a worsening financial performance.
Capital raise
25 March 2024 6:05 PM
Annual Results
- The Company has finite financial resources and no current cash flow from producing assets and therefore requires additional financing in order to carry out its exploration and development activities.
- There can be no assurance that any such funding will be available to the Company on favourable terms or at all.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.