Highlights

  • Metal Bank signs a non-binding Memorandum of Understanding with Terra Mining for contract mining and crushing services at the Seven Leaders Deposit, targeting commencement in Q4 2026 for a six-month production programme
  • Seven Leaders holds a JORC 2012 Mineral Resource of 138,000 tonnes at 1.4 grams per tonne gold for 6,300 ounces, predominantly in the Indicated category, supporting the Phase One production strategy
  • Value engineering studies are underway to assess on-site gravity concentration of ore, which could reduce haulage costs and remove toll treatment costs, improving the project's unit Economics ahead of binding agreements

 

Metal Bank Limited (ASX:MBK) has signed a Memorandum of Understanding with Terra Mining, a contract mining services provider, for the provision of mining and crushing services at the Seven Leaders Deposit — part of the Whiteheads Project located approximately 80 kilometres northeast of Kalgoorlie in Western Australia. The MOU represents a significant procedural milestone in Metal Bank's strategy of phased execution across its Western Australian gold portfolio, moving the Seven Leaders deposit from resource definition toward active production planning in a single announcement.

Terra Mining is described by the company as bringing decades of management experience across Australian resource projects, with a track record in complex mining operations in challenging environments. The MOU is non-binding and subject to several conditions precedent, including grant of the Seven Leaders mining licence, finalisation of mining and processing plans, and negotiation and execution of a binding contract. Estimated commencement is during Q4 2026, with completion expected approximately six months from that point.

Seven Leaders: Resource Profile and Production Case

The Seven Leaders Deposit holds a JORC 2012 Mineral Resource Estimate of 138,000 tonnes at 1.4 grams per tonne gold for 6,300 ounces, with 6,200 ounces in the Indicated category and 100 ounces Inferred. By the standards of the broader gold industry, this is a modest deposit. However, in the context of Metal Bank's stated Phase One strategy — generating Cash Flow from near-term, low-Capital-intensity operations before scaling to larger deposits — Seven Leaders occupies a specific and deliberate role.

The intended mining method is conventional open-cut drill-and-blast using the engaged contractor's fleet. This approach minimises upfront capital requirements and allows the company to sequence its capital deployment across multiple deposits rather than concentrating it in a single large-scale programme. The rationale is sound for a company of Metal Bank's size: generating early cash flow from a known, drill-defined deposit de-risks the path to developing larger Assets such as those in the Livingstone project northwest of Meekatharra, which holds JORC 2012 resources of 122,600 ounces gold across 2.81 million tonnes.

Value Engineering: The Gravity Circuit Option

One of the more financially significant details in the announcement is the ongoing value engineering study exploring on-site gravity concentration of ore. Recent test work has confirmed outstanding gold recovery results, and the gravity circuit option, if pursued, would generate three categories of cost saving: elimination of nugget-effect losses to toll treaters (high-grade coarse gold that can be under-recovered in external processing), reduced haulage costs due to pre-concentration of ore before transport, and removal of toll treatment charges entirely.

For a deposit of Seven Leaders' scale, the economics of processing are particularly sensitive to per-tonne costs, because the small absolute tonnage leaves limited Margin for inefficiency in the cost structure. Capturing the gravity gold on-site rather than relying entirely on external toll treatment would improve the net Recovery Rate for the highest-value fraction of the ore — the nugget-effect gold — which could have a disproportionate positive impact on project economics given the low overall resource grade of 1.4 grams per tonne.

Whiteheads Context and Broader Portfolio

Whiteheads is Metal Bank's Phase One project and contains the Seven Leaders deposit as its initial production target. The broader Whiteheads tenement package lies approximately 80 kilometres northeast of Kalgoorlie, a region with established mining services infrastructure that reduces the logistical complexity of contract mining operations. The Livingstone project, northwest of Meekatharra, represents a larger and longer-term growth opportunity, with 122,600 ounces of JORC resources available for future development as cash flow from the Whiteheads operations matures.

The company's strategy of separating near-term cash generation from longer-term resource development is a considered approach for a junior miner in the current market environment, where access to Debt capital remains selective and Equity markets for small-cap resources companies are episodic. By demonstrating production capability at Seven Leaders with minimal upfront capital, Metal Bank aims to establish a cash-generative base that can support ongoing exploration and the development of its larger resource inventory.

Conditions and Timeline

The MOU is expressly non-binding and rests on several conditions, most notably the grant of the Seven Leaders mining licence. Mining licence applications in Western Australia have generally been progressing within standard statutory timeframes, but licence timing remains an external variable that Metal Bank cannot fully control. Separately, Native Title agreement negotiations with the Kakarra people are described as progressing well, and a technical Mine Development and Closure Plan is in progress — both standard requirements for WA open-cut mining operations.

Access agreement discussions with the relevant pastoralist are ongoing. These landowner negotiations are a routine but consequential step in the Western Australian mining approvals process, and their timely conclusion will be necessary to underpin the Q4 2026 commencement target.

Conclusion

The Terra Mining MOU moves Metal Bank's Seven Leaders production ambition from strategic intent to operational preparation. The non-binding nature of the agreement appropriately reflects the conditions still to be satisfied, but the engagement of a specific mining contractor at this stage signals genuine momentum toward a Q4 2026 production start. The gravity circuit value engineering study adds a layer of upside to the project economics that could materially improve the unit cost structure relative to a conventional toll treatment scenario. For investors tracking Metal Bank's phased execution strategy, the announcement represents a meaningful step along a well-articulated roadmap.