Westgold Resources' Board of Directors has approved its final investment decision (FID) to expand the Higginsville Processing Hub in the Southern Goldfields, Western Australia (WA).

This decision will see the facility's capacity increase from 1.6 million tonnes per annum (mtpa) to 2.6mtpa, a move expected to significantly boost gold production and reduce operating costs.

The expansion involves an investment of $145m (A$202.28m), covering not only the necessary engineering work but also early works and cost escalation.

A completed definitive feasibility study (DFS) determined the technical feasibility and economic viability of the expansion project.

The study, which has capital and operating estimate accuracy of between -5% and +15%, supports Westgold’s strategic goals of increasing production and lowering costs to enhance cash flow.

The investment includes $16.5m earmarked for owner’s costs, accounting for project management and commissioning needs.

This 2.6mtpa expansion plan also incorporates infrastructure improvements such as a new primary crusher, a 5.8MW semi-autogenous (SAG) mill, a pebble crusher, and additional leaching and adsorption tanks.

Financial projections from the DFS highlight a pre-tax net present value (NPV) of $1.4bn at a gold price of $4,905/oz, potentially rising to $2.7bn at spot pricing.

The pre-tax internal rate of return is estimated at 43% based on the $4,905/oz gold price, with a possible increase to 140% at current market rates.

This expansion aims to increase annual production at the Southern Goldfields by approximately 60,000oz and lower processing costs by 24% to $34/t.

The upgraded Higginsville facility is expected to begin increased production by mid-financial year 2028.

Westgold managing director and CEO Wayne Bramwell said: “The Higginsville Expansion Plan (HXP) is the next step to drive down unit costs and increase group free cash flow from the Southern Goldfields.

“By expanding the Higginsville mill capacity to a nominal 2.6mtpa we are creating a more productive, lower-cost processing hub to match the growing outputs from our Beta Hunt mine. This will see us deliver higher group gold production at a lower cost, in line with our three-year outlook.”

Last month, Westgold completed the sale of its Mt Henry Gold Project in WA to Alicanto Minerals.

"Westgold approves expansion of Higginsville Processing Hub" was originally created and published by Mining Technology, a GlobalData owned brand.

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