Name of the Project
King of the Hills (KOTH) gold project.

Location
The Eastern Goldfields region of Western Australia.

Project Owner/s
Gold producer Red 5.

Project Description
Red 5 has approved the final feasibility study for a proposed, standalone 4.7-million-tonne-a-year bulk mining and processing operation at KOTH, with an initial mine life of 16 years and the potential to expand this to six-million tonnes a year.

Life-of-mine production is estimated at 2.5-million ounces of contained gold.

Gold production in years 1 to 6 is expected to average 176 000 oz/y, while peak gold production of 203 000 oz/y will be achieved in 2024, benefiting from the underground mining of one-million tonnes a year in years 1 to 4.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of A$1.1-billion and an internal rate of return of 64.3%, with a payback of 25 months and a gold price of A$2500/oz.

Capital Expenditure
The feasibility study has delivered a capital cost of about A$226-million.

Planned Start/End Date
Red 5 declared commercial production at KOTH in December 2022.

Latest Developments
Red 5 has completed a fully underwritten A$90-million capital raise to support work at the newly commissioned KOTH mine.

The miner has completed a bookbuild for a fully underwritten A$80-million two-tranche share placement, which is being conducted in conjunction with a fully underwritten share purchase plan aimed at raising a further A$10-million.

Some 593-million shares will be placed at 13.5c a share under the share placement, with the first tranche to comprise about 419-million shares to raise A$56.5-million under Red 5’s initial placement capacity.

The second tranche of 174-million shares, to raise a further A$23.5-million, will be subject to shareholder approval at a general meeting scheduled for mid-April.

The share purchase plan will enable eligible shareholders to subscribe for up to A$30 000 of new shares in the company, also at 13.5c each, and will open on March 2 and close on March 21.

The offer of 13.5c a share represents a 22.9% discount to Red 5’s last trading price and a 26.7% discount to the company’s ten-day volume weighted average share price.

Funds raised will ensure that Red 5 is well funded to support steady-state operations at KOTH and provide the company with balance sheet flexibility to accelerate future investment in production and mine life growth.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Red 5, tel +61 8 9322 4455 or email info@red5limited.com.