MGX Resources Launches $38M Decline to Unlock 400,000oz Gold at Central Tanami
Key Takeaways
- The Central Tanami Project JV — 50% MGX Resources (ASX:MGX), 50% Tanami Gold (ASX:TAM) — has executed a $38 million underground decline contract with Macmahon Holdings subsidiary Macmahon Underground Pty Ltd.
- Macmahon will construct a 3.5km decline to approximately 350 metres depth over 14 months, with in-pit portal construction scheduled to commence in September 2026.
- The decline enables 33,000 metres of underground resource definition drilling targeting conversion of over 400,000 ounces of Inferred Resources at Groundrush into the higher-confidence Indicated category required for mine design and financing.
- The CTPJV holds a total JORC 2012 resource of 31.0Mt at 2.8 g/t Au for 2.8Moz across the project, with Groundrush alone hosting 11.0Mt at 3.3 g/t Au for 1.2Moz.
- A development decision is targeted for 2027, with three parallel workstreams — decline construction, resource drilling at Jims Gold Deposit, and site infrastructure upgrades — all advancing concurrently.
The Central Tanami Project Joint Venture (CTPJV) has signed a $38 million underground decline contract at its Central Tanami gold project in the Northern Territory, with Macmahon Underground Pty Ltd (a subsidiary of Macmahon Holdings Limited, ASX:MAH) engaged to construct the critical infrastructure needed to unlock the Groundrush Gold Deposit. The Central Tanami Project Joint Venture (CTPJV) — 50% owned by MGX Resources (ASX:MGX) and 50% by Tanami Gold NL (ASX:TAM) — is targeting a development decision in 2027, and the decline is the enabling structure to get there. Surface works are already underway, with in-pit portal construction scheduled to commence in September. This is the path to turning over 400,000 ounces of currently low-confidence resources into the geology that supports a mine design.
Inside the $38 million Groundrush decline agreement
Macmahon will deliver portal and vent establishment plus the initial 3.5km of decline development to a depth of circa 350 metres over a 14-month construction period. The decline itself is not the prize. The prize is what it enables. Once constructed, underground drilling platforms will allow the JV to conduct resource definition drilling down to approximately 650 metres depth, targeting the Groundrush Gold Deposit.
Approximately 33,000 metres of infill drilling is planned, with drilling expected to commence towards the end of the 14-month construction period. This is the work that converts geological theory into bankable confidence.
Surface preparation is already progressing — laydown areas are established, and the pit access ramp is being reinstated. Macmahon mobilises for in-pit portal construction in September.
| Contract Element | Detail |
|---|---|
| Contract value | ~$38 million |
| Contractor | Macmahon Underground Pty Ltd (subsidiary of Macmahon Holdings, ASX:MAH) |
| Initial decline length | 3.5km |
| Target depth | circa 350 metres |
| Construction period | 14 months |
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The drilling prize — converting 400,000+ ounces to higher confidence
The core objective of the underground drilling programme is to convert over 400,000 ounces of Inferred Resources within Groundrush into the higher confidence Indicated category. This is the geological upgrade required for mine design and development purposes. You are not simply exploring for more gold. You are proving the gold you already know exists can be mined economically.
The context matters. As of the 11 November 2025 Mineral Resource Estimate, the CTPJV holds a total JORC 2012 resource of:
- 31.0Mt at 2.8 g/t Au for 2.8Moz of contained gold across the project
- 11.0Mt at 3.3 g/t Au for 1.2Moz of gold within Groundrush specifically
The planned 33,000 metres of resource definition drilling targets the portion of that 1.2 million ounce Groundrush inventory currently sitting in the Inferred category.
Why Inferred-to-Indicated matters for investors
JORC resource categories reflect geological confidence, not just tonnage. Inferred Resources have the lowest confidence level — they are based on limited data and geological inference. Indicated Resources have higher confidence, supported by sufficient drilling density and geological continuity to allow mine design and development decisions.
You cannot build a mine plan around Inferred Resources. Banks do not finance them. Engineers do not design around them. The 2027 development decision the JV is targeting requires Indicated Resources. The underground decline is the infrastructure that makes that conversion possible. This drilling programme is the value-unlocking step between exploration concept and bankable project.
Wider progress across the Central Tanami site
Three parallel workstreams are building momentum across the site:
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Resource definition drilling recommenced at the Jims Gold Deposit in June. Jims was previously mined 25 years ago and offers potential as an expanded open pit ore source to supplement Groundrush. The current Mineral Resource Estimate for Jims totals 2.6Mt at 2.7 g/t Au for 220,000oz of contained gold.
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Repairs and improvements to accommodation camp and utilities infrastructure. Considerable work is underway within the accommodation camp and associated utilities areas adjacent to the central plant site location, along with cleanup and repair of other infrastructure assets necessary to support planned activities.
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Recruitment of key site and project roles. The site team is building operational capability ahead of the ramp-up in activity.
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What comes next for MGX shareholders
The roadmap is defined. Portal construction commences in September. Macmahon delivers the 14-month decline build to 350 metres depth. Underground drilling begins in the latter stages of construction, targeting 33,000 metres of resource definition work to convert over 400,000 ounces from Inferred to Indicated. Resource conversion feeds into mine design. Mine design feeds into the targeted 2027 development decision.
This is a defined path toward establishing a major new gold business in the Northern Territory, with the decline as the enabling infrastructure.
Peter Kerr, Chief Executive Officer
“The commencement of the Groundrush decline represents a key milestone in the CTPJV’s efforts to advance the project to a development decision and ultimate production.”
“We and our joint venture partner, Tanami Gold, look forward to sharing regular updates as we build momentum towards establishing a major new gold business in the Northern Territory.”
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