Brightstar’s Growth Hinges on Sandstone PFS and Resource Conversion Risks
Brightstar Resources has unveiled a definitive feasibility study for its Laverton-Menzies gold projects, outlining a clear growth trajectory targeting 70,000 ounces annually over five years and aiming for 200,000 ounces by 2029.
- Laverton-Menzies DFS supports 70koz annual production over 5 years
- Pre-tax NPV of $316 million and IRR of 73% at spot gold prices
- New 1.0Mtpa processing plant at Laverton advancing to final investment decision
- Menzies mining to commence in early 2026 with toll treatment MoU signed
- Sandstone project pre-feasibility study targeted for first half of 2026
A Definitive Feasibility Milestone
Brightstar Resources Limited has taken a significant step forward in its ambition to become a leading West Australian gold producer with the release of its Definitive Feasibility Study (DFS) for the Laverton-Menzies gold projects. The study outlines a robust production plan targeting an average of approximately 70,000 ounces of gold per annum over five years, with a pathway to scale up to 200,000 ounces annually by 2029.
The DFS reveals strong project economics, with a pre-tax net present value (NPV) of $316 million and an internal rate of return (IRR) of 73% based on spot gold prices of A$5,000 per ounce. These figures underscore the financial viability of Brightstar’s multi-hub growth strategy, which is underpinned by a $120 million peak funding requirement and a rapid payback period of just one year post mill commissioning.
Strategic Infrastructure and Operational Advances
Central to Brightstar’s plan is the construction of a new 1.0 million tonnes per annum (Mtpa) carbon-in-leach (CIL) processing plant at Laverton, designed to handle a blend of oxide and fresh rock material. The plant is progressing through front-end engineering and design (FEED), with a final investment decision (FID) targeted for late 2025. This facility will serve as the processing hub for multiple open pit and underground mines, including the Lord Byron and Cork Tree Well open pits and the Yunndaga underground mine.
Meanwhile, mining operations at the Menzies Gold Project are set to commence in early 2026. Brightstar has secured a memorandum of understanding (MoU) with Norton Gold Fields’ Paddington processing plant to toll treat up to 2.0 million tonnes of Menzies ore, effectively minimizing upfront capital expenditure and accelerating first gold production. This phased approach reduces operational risk and supports cash flow generation to fund subsequent development stages.
Exploration and Growth Prospects
Brightstar is actively advancing exploration programs, with over 130,000 metres of drilling planned across its portfolio in 2025. The Sandstone Gold Project, with a substantial 1.5 million ounce mineral resource, is progressing towards a pre-feasibility study (PFS) targeted for the first half of 2026. This study will evaluate processing scenarios ranging from 3 to 5 Mtpa, aiming to establish Sandstone as a new long-life production centre with first gold anticipated in the second half of 2028.
The company’s multi-hub strategy leverages a large landholding with granted mining leases, significant mineral resources, and operational synergies across Laverton, Menzies, and Sandstone. Brightstar’s management team, with deep technical and operational expertise, is focused on converting inferred resources to higher confidence categories and extending mine life through targeted drilling and development.
Financial and Market Position
Brightstar’s market capitalization stands at approximately $232 million, supported by a solid cash position and working capital facilities. The company’s enterprise value to resource ounce metric has improved markedly, reflecting growing investor confidence as it transitions from exploration to production. The DFS outcomes provide a clear framework for funding discussions, with debt term sheets received from multiple Tier 1 banks targeting a 70, 30 debt-to-equity ratio.
Community engagement and environmental stewardship remain priorities, with ongoing native title negotiations and rehabilitation programs in place. Brightstar’s strategy balances near-term cash flow generation with long-term growth, positioning it well within Western Australia’s tier-one mining jurisdiction.
Bottom Line?
Brightstar’s Laverton-Menzies DFS sets a strong foundation for growth, but the market will watch closely as the company advances Sandstone’s pre-feasibility and navigates funding and execution risks.
Questions in the middle?
- How will Brightstar finance the $120 million peak funding requirement amid market volatility?
- What are the key risks in converting inferred resources to reserves, especially at Sandstone?
- How quickly can the Sandstone pre-feasibility study translate into a final investment decision and production?