Standout Project See Walkabout Resources Share Price Jet 7.41%

Perth-based minerals developer Walkabout Resources Limited [ASX:WKT] has seen its share price rise for the sixth consecutive day.

At time of writing WKT shares were up 7.41%, to trade one cent higher at 14.5 cents per share.

Source: Trading View

The African-focused energy minerals developer, who is based in Western Australia, has seen its stock price climb significantly since announcing a substantial upgrade to the ore reserve for its high-grade Lindi Jumbo graphite project in Tanzania.

Related: 10 Aussie Mining Stocks you should be watching Go NUTS in 2019. 

What’s all Walkabout Resources share price excitement about?

In its latest announcement, released this morning, Walkabout announced a significant upgrade to the economic potential of its Lindi Jumbo project.

Having upgraded the grade of the graphite at its project to 17.9% from 16.1% on Thursday last week, representing an 11% increase in the life-of-mine, WKT has today indicated a further increase in life-of-mine.

According to results released from WKT’s definitive feasibility study (DFS), life-of-mine revenue has been upgraded to US$1.445 billion, representing a 21.6% increase from the last DFS conducted in 2017.

The upgrade potential mine revenue comes as the DFS outlines in increase in mine life of four years, bringing total operating life to 24 years.

The report also mentions that the grade of graphite is expected to steadily increase towards the end of the pit life.

The remodelling of mine depletion has also changed the financial estimates of the project.

Operating costs of the mine excluding transport have decreased 2.4% along with pre-production capital costs, which have decreased 6.4% from the 2017 estimate.

What’s next for Walkabout?

Today’s news is likely to cause excitement for investors and current shareholders, with Walkabout’s tenements certainly representing strong economic potential.

As executive director Allan Mulligan points out, this strong potential flies in the face of conservative sales assumptions from analysts.

We are delighted with the results of the DFS which demonstrate that the extraordinary Lindi Jumbo project continues to deliver compelling economics in spite of conservative sales assumptions. We have a high degree of confidence in the revised cost estimates which are derived from actual engineering drawings and negotiated contract prices.

Construction on the project is dependent upon adequate pre-production funding being secured. WKT outlined the current schedule has not been modified at present, on the basis that commissioning can be realised 9–12 months after Project-start funding has been received.


Ryan Clarkson-Ledward,
For Money Morning

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