The Wiluna Mining Corporation Ltd (ASX: WMX) share price is flat today despite positive updates on its flotation plant construction, mineral drilling project and renewable power studies.
The Perth-based gold mining company controls more than 1,600sq km of the Yilgarn Craton in the Northern Goldfields of Western Australia.
After dropping slightly this morning, the Wiluna share price has returned to where it started today and is trading at 99 cents at the time of writing.
Let’s take a closer look at what’s driving the Wiluna share price today.
What did Wiluna announce?
In its latest development update, the company revealed its stage 1, 750 kilotonne-per-annum flotation plant construction and mine development was on schedule, with the mineral resource drilling for its stage 2 feasibility study also on track.
Wiluna’s renewable power studies to supplement gas power generation are in progress, in line with the growing trend across the basic materials sector to diversify into renewable energy.
The company says its stage 2 feasibility study into a metallurgical test work program is also underway for additional design data and variability testing.
In addition, Wiluna has signed an agreement to enter a five-year alliance with Byrnecut Australia Pty Limited for the construction and operation of an underground mine.
Management commentary
Despite the Wiluna share price nearing 10-year lows, executive chair Milan Jerkovic was bullish regarding its progress.
Outstanding progress has been made by our projects and operations teams and key contractors as we prepare to ramp up underground operations to supply sulphide ore feed to the new flotation concentrator currently under construction at Wiluna.
Ensuring the success of these two activities through 2021 is the primary focus of our business as our people work to deliver upon our promise to transform the Wiluna Mining Centre into a significant producer of gold doré and gold in concentrate.
At the same time, we are drilling to expand our resources and reserves for inclusion in the Stage 2 Feasibility Study due to be completed by the end of this year. We continue to explore ways to mine and process more efficiently, sustainably and profitably for the benefit of our shareholders and stakeholders.
Mr Jerkovic emphasised the importance of partnerships with leading industry players. He welcomed the support of GR Engineering Services for process engineering, plant design and construction, and Byrnecut Australia to construct and operate the mine and offtake partners Polymetal and Trafigura.
About the Wiluna share price
Last week, the gold miner received investor commitments for $21.5m as part of an $80m funding package for a new West Australian gold mine.
Its ongoing drilling campaigns have also seen a 142 per cent increase in the contained gold within the company’s mineable underground ore reserves. There has also been no negative press about the company for some time now.
But it hasn’t been a great six months for the miner, with shares falling from a high of $2.18 on 23 September 2020 to their current level of 99 cents. The Wiluna share price is down 8.76% this week, 15.02% this month and 28.78% this year to date.
It’s also down 42.06% against the basic materials sector – a sector that has boomed thanks to strong iron ore prices.
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Motley Fool contributor Lucas Radbourne-Pugh 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 Bruce Jackson.
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