Westgold to massively increase production at Higginsville

Westgold Resources (ASX: WGX) has announced plans to expand its existing 1.6Mtpa Higginsville processing plant to 2.6Mtpa.

The Higginsville expansion plan (HXP) would increase the steady state gold production at the site, located in WA, from 87,000 ounces per annum to between 122,000 and 160,000 ounces per annum.

Westgold’s chief executive and managing director Wayne Bramwell said that the company’s strategy is to drive its cost base lower and increase free cash generation and improving outputs.

“An expanded, lower cost 2.6Mtpa Higginsville mill will also enable greater resource development opportunities across the Southern Goldfields portfolio,” he said.

“Debottlenecking of the existing Higginsville mill has commenced with the next phase of the Higginsville detailed engineering study to commence immediately, with a view to making financial investment decision on the HXP during FY26.”

The project is expected to reduce processing costs from $36 per tonne to $33 per tonne as well as decrease the Southern Goldfields’ midpoint all-in sustaining costs (AISC) by approximately $142 per ounce.

The scoping study presented modest midpoint capital requirements of $92m, most of which is funded by the $85m sale of Lakewood.

The study also showed a midpoint internal rate of return (IRR) of 37% with a payback period of just over two years at a gold price of $3,200 an ounce.

Expansion of the project has the potential to bring forward an estimated $135m to $279m in cash flow at the same assumed gold price.

The Higginsville processing plant is currently supplied by the Beta Hunt and Two Boys underground mines. Open pit mining has also recently recommenced at Lake Cowan and will provide a softer oxide ore source to the plant.