The Red 5 Ltd (ASX: RED) share price is on the move, up 6% in afternoon trading after earlier being up more than 11%.
This follows a company update on the ASX gold miner's King of the Hills project.
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What milestones did Red 5 report?
The Red 5 share price is lifting after the company reported it has cleared a key legislative hurdle and moved forward with an engineering contract at its King of the Hills gold mine in Western Australia.
On the legislative side, the company reported that the Department of Mines, Industry Regulation and Safety has approved its mining proposal for King of the Hills. This paves the way for Red 5 to recommence mining at the gold mine in 2022. The first gold production is forecast for the June 2022 quarter.
Red 5 also reported it has approved Phase 2 of its engineering, procurement & construction contract. Maca Ltd (ASX: MLD), Red 5's engineering and construction contractor, is now expected to speed up the deployment of its crew over the next months. According to the company, the Phase 2 project is $10 million under budget.
The company said it was finalising the debt financing for King of the Hills with a Tier-1 banking syndicate. It expects that to be complete in the March 2021 quarter.
Commenting on the achievements, Red 5's managing director Mark Williams said:
With all major mining approvals now in place and the debt funding process on track for completion this quarter, Red 5 has approved Phase 2 of the EPC contract. This will allow MACA Interquip to ramp-up the mobilisation of their construction teams over the coming months.
The manufacture and delivery to Australia of all key long-lead items for the plant is also well on track, which will help to ensure that key construction and installation milestones can be achieved once construction of the plant moves into full swing in the second half of this year.
Red 5 share price snapshot
It hasn't been an easy 12 months for Red 5 shareholders, with shares down 42% since this time last year. In comparison, the All Ordinaries Index (ASX: XAO) is up 9% over that same time.
Year-to-date, the Red 5 share price is down 31%.
