Resources Top 5: West Wits on track for Qala Shallows to lift South Africa’s gold standing

A definitive feasibility study update has drastically improved financials for West Wits Mining’s Qala Shallows gold project in South Africa.

A DFS update has strengthened West Wits Mining’s Qala Shallows project and should support a lift in South Africa’s gold production standing. Pic: Getty Images

• Qala Shallows gold project is expected to generate US$2.7bn in revenue and free cash flow of US$983m for WWI

• Geophysics is expected to refine potential high-grade copper-gold zones at GTE’s Oval and Oval South targets

• FAU has started diamond drilling at the Nimba gold project JV in Liberia

Your standout small cap resources stocks for Wednesday, July 23, 2025

West Wits Mining (ASX:WWI)

South Africa was for many years at or near the top of the list of gold-producing countries but has slipped in the past few decades. In 2024 it was twelfth globally and third among African nations with 98.9 tonnes, behind Ghana and Mali, and well down on leading producer China’s 380.2 tonnes.

One company with intentions of lifting South Africa’s position is West Wits Mining (ASX:WWI)with its Qala Shallows project, part of the broader Witwatersrand Basin project in an historic gold-producing region near Johannesburg.

The company’s production intentions have been boosted by an updated definitive feasibility study that drastically improved Qala Shallows financials and saw shares up 25% to a high of 2.5c accompanied by volume of more than 95m.

Under the base case, the project is expected to generate US$2.7bn in revenue – an increase of US$983m from the original 2023 study – and free cash flow of US$983m (up 88%).

Post-tax net present value and internal rate of return, which are measures of profitability, increased by 97% and 53% to US$246m and 81% respectively.

Managing director Rudi Deysel said the updated DFS delivered a compelling outcome by reinforcing Qala Shallows’ robust value and strong economic fundamentals.

Adding interest for WWI, peak funding has been reduced from US$54m over a three-year period to US$44m over a 2.6-year period while the payback period from the end of the peak funding has dropped to eight months from 13 months.

Steady-state production of 70,000oz per annum has increased from nine years to 12 while overall production is now 944,000oz over a mine life of 16.8 years.

All-in sustaining costs for Qala Shallows increased US$977/oz to US$1289/oz, with 14.3% of the increase linked to the higher gold price assumption of US$2850/oz from US$1850/oz in 2023.

The updated study uses a new gold price (US$2850/oz) and an exchange rate of ZAR18 to US$1 based on current Bloomberg consensus forecasts. This is still hugely conservative compared to the current spot price above US$3300/oz.

Additionally, the updated mine plan is based on a 1.31g/t lower cut-off grade, which is warranted given the higher gold price environment compared to the 2023 DFS.

This has facilitated a 9.3% increase to the ore reserve, which is now 4.6Mt at 2.6g/t for 383,900oz of contained gold, as well as an accelerated and increased production profile as more ore is available for inclusion.

Great Western Exploration (ASX:GTE)

(Up on no news)

While Great Western Exploration (ASX:GTE) had no news today, it announced earlier this month the start of a geophysics program to refine potential high-grade copper-gold zones at Oval and Oval South targets of the Yerrida North project in WA.

With the project near the DeGrussa and Monty copper-gold volcanic hosted massive sulphide (VHMS) deposits in the adjacent Bryah Basin, GTE considers the targets as being prospective for similar mineralisation.

Investors share the company’s enthusiasm with shares moving 75% higher to a daily top of 2.1c.

Previously reported assays at Oval returned highly prospective pathfinder geochemical signatures from multiple potential VHMS horizons and these units are interpreted to be on the edge of potential copper-gold rich VHMS system(s).

The company is undertaking a close-spaced and cost-effective ground gravity survey at Oval and Oval South to refine the broad-spaced airborne gravity gradiometry dataset. 

Results from the geophysics will supplement a large dataset gained from previous exploration campaigns at Oval and Oval South, including diamond drilling geological data, surface (EM) and down-hole (DHEM) electromagnetic surveys. 

This will be used to build a comprehensive geological model for drill targeting VHMS targets at Oval and the yet to be drill tested Oval South.

Great Western anticipates the gravity survey will be complete and data interpreted and modelled by early August 2025.

The company had a strong cash position of $3.7m at March 31, 2025, and is well-funded for its forthcoming exploration. 

First Au (ASX:FAU)

On completing a month-long mapping program over a 10km2 area at Nimba gold project JV in Liberia, First Au (ASX:FAU) has moved to diamond drilling with an initial 3000m program underway using a track-mounted rig.

This aims to confirm FAU’s structural interpretation from previous drilling and to test the westerly extension along strike of the newly generated targets from mapping at Ziyatoya prospect.

Measurements and structural interpretations were conducted against geological intersections of Ziyatoya against a previous drill hole by Hamak Gold and its surrounding area.

To confirm the structural orientation, twin holes will be drilled adjacent to the previous hole as part of the first round of drilling.

“Following the completion of our legal due diligence at the Liberian Nimba gold project, our team of experts completed a 21-day mapping program, having assisted FAU to derive the initial drill targets,” newly appointed executive director Lei Shi said.

“I’m very excited to lead our drillers from Hit N Drill Limited to initiate this program with the aim to confirm the geological system and potential ore body, supported by previously drilled intersections and our interpretation of the mineralisation identified.” 

AuMega Metals (ASX:AAM)

AuMega Metals, which is utilising best-in-class exploration on a district-scale package spanning 105km along Cape Ray Shear Zone in Newfoundland, Canada, has appointed James Withall as a non-executive director, effective August 1, 2025, and shares reached 4.4c, a lift of 22.22%.

Withall was formerly CEO of Rupert Resources and brings nearly 30 years of international experience in mining, exploration and natural resource investing.

“I’m excited to join what I believe is one of the most compelling opportunities in the junior exploration space,” Withall said.

“AuMega is led by a talented and disciplined team that continues to make smart, well-timed decisions – an approach that closely mirrors what we pursued at Rupert Resources. 

“The company’s strong backing from B2Gold and several major global funds gives AuMega a uniquely supportive and strategic ownership structure for a company at this stage.”

The Cape Ray zone is a significant under-explored geological feature recognised as Newfoundland’s largest identified gold structure. 

It hosts Equinox Gold’s Valentine project, the region’s largest gold deposit (+5Moz), along with AuMega’s expanding mineral resource at Cape Ray and Bunker Hill.

Bubalus Resources (ASX:BUS)

A Victorian Goldfields address is again in demand due to the success of the Fosterville and Costerfield mines with several companies seeking the next ultra-high grade deposit.

One of them is Bubalus Resources (ASX:BUS), which has identified some compelling Fosterville-style targets at the Crosbie North gold-antimony prospect within its Crosbie project in the Bendigo region.

BUS hopes Crosbie, which is within 20km of Fosterville, can mirror at least some of the success of that operation, and early signs are encouraging with the latest targets at Crosbie North having geological similarities supported by surface rock chip results of up to 12.1 g/t Au and 2.02% Sb.  

Fosterville was a struggling operation until the discovery of the Swan Zone in 2016, which had a reserve grade of 58.8g/t gold.

The discovery transformed Fosterville into a 500,000ozpa producer, in turn elevating then-owner, Canada’s Kirkland Lake Gold, into a market darling.

Fosterville now produces around 150,000ozpa but still has resources of around 3.3Moz at roughly 4g/t.

This article does not constitute financial product advice. You should consider obtaining independent financial advice before making any financial decisions. While West Wits Mining and Bubalus Resources are Stockhead advertisers, they did not sponsor this article.

Originally published as Resources Top 5: West Wits on track for Qala Shallows to lift South Africa’s gold standing