KUALA LUMPUR (Nov 14): Gold miner Niche Capital Emas Holdings Bhd (KL:NICE) has commenced gold mining operations at the Sokor North Gold Mine in Kelantan, with the successful commissioning of its heap leaching plant there.
In a statement Thursday, Niche Capital said the mine is part of its mining concession area totalling 4,524.6 acres — comprising Sokor North, Sokor Midlands and Sokor South in Hutan Simpan Kekal Sokor Taku in Tanah Merah.
The initial resource estimate for just 20 acres out of the 1,352.7 Sokor North tenement is 17,100 ounces, Niche Capital said, highlighting "the significant potential for additional resources across the broader concession".
This initial resource is valued at about RM201 million, based on the current market price of gold of about RM378 per gram on Nov 7, Niche Capital said.
"The company is actively conducting continuous expiration works across its tenements, with the potential for additional resources to be proven over time," it said.
The commissioning of the plant follows a three-year development phase, starting from the completion of a comprehensive mineral resource report in 2023 to securing the authority's approval for its environmental impact assessment in March this year, and getting the greenlight from the Kelantan Department of Mineral and Geoscience for hard rock mining on Sept 18, according to Niche Capital.
Prior to that, the federal Department of Environment had approved the environmental impact assessment in March, while the Kelantan State Department of Environment granted a "no objection" status for the environmental management plan in August, it said.
“Within just 1.5 months of obtaining these regulatory approvals, Niche Capital Emas has constructed and commissioned its heap leach plant, marking the commencement of its gold mining operations,” Niche Capital Emas said.
The timing also coincides with strong gold prices, which have risen from an average of US$1,798.89 per troy ounce in 2021 to above US$2,700 per troy ounce currently, it noted.
Niche Capital’s subsidiary Pembangunan Maju Setia Sdn Bhd entered into a joint venture with Spate Precious Metals Sdn Bhd in 2021 for the gold mining project. Under the agreement, Niche Capital is entitled to 70% of the profits, with Spate Precious receiving the remaining 30%.
According to Niche Capital's June 2021 circular to shareholders, Spate Precious was appointed as the mining contractor for the Sokor North site by Jayamas Mining Sdn Bhd, which had secured the mining rights from the Kelantan state government in 2018.
“Given the global demand for minerals, this maiden venture provides Niche Capital with a valuable opportunity to explore additional prospects in the mining sector. We believe this milestone will support our ongoing efforts for growth and expansion as we work towards establishing a strong presence in the gold and minerals industry in the region,” said the company’s chief operating officer Tan Ken Sim.
Shares in Niche Capital Emas closed one sen or 6.06% higher at 17.5 sen on Thursday, giving the company a market value of RM252.27 million. Year-to-date, the stock has gained over 25%.