Kaiser Reef’s Shift to Nova Zone Marks Risky Transition from Remnant Mining

Transitioning to Modern Mining at A1

Kaiser Reef Limited has reached a significant milestone in its December 2024 quarter by advancing development into the Nova Zone of the historic A1 Gold Mine in Victoria. This area, untouched by previous mining efforts, represents a strategic pivot from decades of remnant ore extraction to a modern, mechanised mining operation. The company’s underground decline has now extended approximately 15 metres below the lowest historical level, opening access to higher-grade ore bodies and new reef systems such as the Tasma reef.

While this development focus has temporarily reduced short-term production, it lays the groundwork for increased output and improved cash flow in the coming quarters. The initial underground diamond drilling campaign has already yielded impressive high-grade intercepts, including assays of 65.1 g/t and 40.9 g/t gold, which have been swiftly incorporated into mine planning.

Revitalising the Maldon Gold Project

Alongside progress at A1, Kaiser completed a comprehensive restart study for the Union Hill Gold Mine at Maldon, currently on care and maintenance. The study highlights the mine’s potential to return as a significant producer, leveraging its proximity to the company’s fully operational Maldon Processing Plant. With over 2.1 million ounces historically mined from the region and existing infrastructure such as a 2.4 km decline and grid power, the project is well positioned for a cost-effective restart.

Notably, the Maldon plant commissioned its gravity circuit during the quarter and processed its first trial delivery of third-party ore, signaling Kaiser’s ambition to establish itself as Victoria’s preferred toll treatment facility. Discussions are underway to expand these toll treatment opportunities, which could diversify and stabilise revenue streams.

Financial Strength and Capital Raising

Kaiser Reef’s operational advances are underpinned by a robust financial position. The company successfully raised $8 million through a share placement, attracting strong support from both existing and new investors. These funds are earmarked for accelerating the A1 Mine ramp-up, expanding high-grade drilling programs, and advancing the Maldon project. As of 31 December 2024, Kaiser held $6.2 million in cash and maintained a modest inventory of unsold gold bullion valued at approximately $0.5 million.

The company remains largely debt-free and has not engaged in gold hedging, positioning it to benefit fully from the current elevated gold price environment, which averaged over AUD 4,000 per ounce during the quarter, significantly higher than the last operational period at Maldon in 2018.

Looking Ahead: Scaling Production and Exploration

In the upcoming quarter, Kaiser plans to continue decline development and infrastructure upgrades at the A1 Mine, with a focus on mechanised ore development to boost production rates. The ongoing drilling campaign aims to further define the Nova Zone’s resource potential and expand the mine’s inventory. Concurrently, the company is evaluating financial scenarios to reopen the Union Hill Gold Mine, potentially establishing a second operational base in Victoria.

In addition, Kaiser is actively engaging with potential partners to grow its toll treatment business, which could become a significant complementary revenue source. These strategic initiatives reflect a clear growth trajectory, leveraging both exploration success and operational optimisation.