New Murchison Gold (ASX: NMG) begins mining at Crown Prince after securing capital raise

How is New Murchison Gold positioning itself as a near-term gold producer with the Crown Prince development?

New Murchison Gold Limited (ASX: NMG) has officially commenced mining activities at the Crown Prince Gold Project, located within its larger Garden Gully tenement in the Murchison region of Western Australia. On June 25, 2025, the Perth-based gold developer confirmed that all necessary mining and environmental approvals had been secured, paving the way for its transition from an exploration-stage company to a gold producer.

The first blast is scheduled for June 30, 2025, marking the start of ore extraction. Early deliveries of high-grade material are expected to reach Westgold Resources Limited’s Bluebird Gold Processing Operation (BBGO) by September 2025. The development comes as New Murchison Gold finalizes a $15 million capital raise, reinforcing its working capital position in the lead-up to first revenues.

What government approvals and operational milestones allowed mining to commence at Crown Prince?

The Western Australian Department of Energy, Mines, Industry Regulation and Safety granted final approval of New Murchison Gold’s Mining Proposal and Mine Closure Plan, as well as a Works Approval and Native Vegetation Clearing Permit. These regulatory clearances enabled the company to confirm a positive Final Investment Decision (FID) and begin site mobilisation in late June.

Ahead of the inaugural blast, the Western Australian gold developer has already mobilised key infrastructure and equipment, including three 200-tonne excavators, articulated dump trucks, water pipelines, and ancillary machinery. Development, drilling, and mining contracts have been executed with a suite of experienced contractors, including Ozland Mining Services Pty Ltd, which was selected as the primary open-pit mining partner after a detailed tendering and due diligence process.

Institutional sentiment has been broadly supportive, with investors encouraged by the project’s regulatory traction, high-grade resource profile, and clear execution pathway. While exploration risk has historically been a discounting factor for New Murchison Gold’s valuation, the transition to near-term production is seen as a re-rating catalyst by some market participants.

What is the expected ore delivery schedule and processing arrangement with Westgold Resources?

New Murchison Gold has structured an ore delivery schedule targeting approximately 40,000 tonnes per month at an average gold grade exceeding 4 grams per tonne. Deliveries to Westgold Resources’ BBGO plant are expected to continue for at least 24 months under a toll treatment arrangement, with potential extensions subject to ongoing mine planning between the two companies.

This offtake structure allows the Western Australian gold developer to focus capital on mining and logistics without the need to build its own processing facility. The BBGO facility, located near Meekatharra, offers a proven processing route and operational flexibility.

The mine plan is underpinned by a detailed Ore Reserve released on February 3, 2025, which outlined economically viable gold extraction from near-surface zones. That reserve was based on a November 2024 Mineral Resource Estimate update, which refined tonnage, grade distribution, and confidence categories across the Crown Prince deposit.

How is the $15 million capital raise structured, and what does it signal about New Murchison Gold’s financial runway?

To fund the development phase and bridge to first revenues, New Murchison Gold is raising $15 million through a two-tranche equity placement and a Share Purchase Plan (SPP). The placement is priced at AUD 0.017 per share, reflecting a 5.6 percent discount to the June 24 closing price of AUD 0.018. The raise was led by Canaccord Genuity (Australia) Limited, with Argonaut Securities Pty Ltd and Tamesis Partners LLP serving as co-managers.

The first tranche, expected to close on July 2, 2025, will issue 470.6 million new shares under the company’s existing placement capacity. The second tranche, totaling 235.3 million shares, will be subject to shareholder approval at a general meeting in mid-August. Concurrently, the SPP will offer eligible Australian and New Zealand shareholders an opportunity to invest up to AUD 3 million on the same terms.

Importantly, Westgold Resources—New Murchison Gold’s largest shareholder with a 15.74 percent stake—has committed to maintaining its pro-rata ownership by subscribing for AUD 2.361 million in new shares. This strategic endorsement adds confidence to the capital structure and reflects alignment with Crown Prince’s development timeline.

According to the unaudited pro-forma capital table, New Murchison Gold expects to end the June quarter with AUD 14.5 million in cash. When combined with placement proceeds, the total cash position will rise to approximately AUD 29.5 million. Of this, AUD 3.93 million is allocated to remaining pre-production capex, AUD 11.29 million to pre-revenue operating costs, and AUD 0.8 million to corporate expenses, with the balance retained as contingency and exploration flexibility.

What are the geological and strategic attributes of the Crown Prince deposit and broader Garden Gully project?

The Garden Gully Gold Project spans over 677 square kilometers in Western Australia’s Abbotts Greenstone Belt, a well-mineralised corridor known for structurally controlled gold systems. Crown Prince is the most advanced of multiple gold targets within the Garden Gully tenure, with mineralisation associated with north-trending structures and contacts between felsic and mafic metamorphosed rocks.

Crown Prince’s mineralisation has demonstrated continuity, shallow depth, and strong grades. New Murchison Gold has completed diamond drilling, grade control drilling of the upper 50 meters, and initial geotechnical assessments to support near-surface mining. The deposit’s geometry has allowed for a relatively low strip ratio and capital-efficient development.

Institutional investors view the Crown Prince asset as a potential “starter pit” that could unlock further growth in the Murchison portfolio. If early production is successful, New Murchison Gold may use Crown Prince as a cash-flow engine to fund additional exploration or extend production into nearby prospects within the Garden Gully district.

What remaining regulatory steps and operational goals lie ahead before revenue generation begins?

While the key regulatory hurdles have been cleared, New Murchison Gold is progressing several ancillary approvals, including a 5C Licence to Take Water (administered by the Department of Water and Environmental Regulation) and a Dangerous Goods Licence. Based on current hydrogeological assessments, the upper pit appears dry, and dewatering may only be required six months into production.

From an operational perspective, New Murchison Gold plans to initiate ore stockpiling in July 2025 and begin ore crushing in August, ahead of the first trucking runs to BBGO in September. The company expects revenue recognition to begin in the October 2025 quarter, with a ramp-up to steady-state deliveries aligned with the mine schedule.

The delivery of 40,000 tonnes per month over 24 months would position New Murchison Gold among the lower-tier producers on the ASX by volume, but with attractive grade characteristics. Further mine life extensions and production scale-up could materially impact both revenue and valuation over the medium term.

How are investors and analysts responding to New Murchison Gold’s production transition?

Investor sentiment has been broadly positive following the June 25 announcement, with institutional backers welcoming the rapid execution timeline and strong permitting performance. The endorsement by Westgold Resources, in particular, has been interpreted as a vote of confidence in both project quality and corporate governance.

While shares in New Murchison Gold have traded relatively flat in recent weeks, analysts expect trading volumes and valuation multiples to respond more strongly as production milestones are met in the second half of 2025. The current market capitalization of approximately AUD 177 million reflects a forward-looking valuation based on successful ramp-up and consistent ore delivery.

Several investors believe the transition to cash flow will allow New Murchison Gold to diversify its asset base, advance regional exploration at Garden Gully, and potentially consider adjacent M&A opportunities in the Murchison district.

What could Crown Prince mean for the long-term growth trajectory of New Murchison Gold?

With mining now underway and capital raised ahead of first revenue, New Murchison Gold has entered a decisive new phase in its corporate evolution. The Crown Prince Gold Project serves not only as a production starter but as a strategic launchpad for the broader Garden Gully region. As operations stabilise and revenue flows begin, investor focus is likely to shift toward mine life expansion, exploration upside, and the potential for multi-asset development.

For now, institutional support, contractor mobilisation, and ore delivery agreements provide a strong foundation. Whether the gold developer can scale beyond Crown Prince into a regionally dominant mid-tier producer will depend on execution, discovery, and disciplined capital allocation in the quarters ahead.