Wiluna Royalty Changes and Pending Drilling Results Pose Risks for GWR

Progress at Prospect Ridge Magnesium Project

GWR Group Limited continues to advance its flagship Prospect Ridge Magnesium Project in northwest Tasmania. The company is collaborating with the University of Tasmania to conduct metallurgical test work, with results expected in the September quarter. This work aims to refine processing techniques, particularly targeting the removal of deleterious elements such as silica, which is critical for producing high-quality magnesite products.

The project holds an inferred mineral resource estimate of 25 million tonnes at 42.4% magnesium oxide, positioning it as one of Australia's largest magnesite deposits. Recent drilling activities have been completed, with assay results pending, which will inform further resource modelling and potential scoping studies.

Financial Strength and Strategic Investments

GWR's robust balance sheet is a key enabler for its development and acquisition strategies. The company reported cash reserves of approximately $38 million at quarter-end, providing a solid foundation for ongoing exploration and project advancement. Additionally, GWR holds a significant equity stake in Tungsten Mining NL, valued at nearly $12 million, reflecting its strategic exposure to tungsten; a critical mineral with tightening global supply due to Chinese export restrictions.

Wiluna Iron Ore Royalty Adjustment

In response to prevailing iron ore market conditions, GWR and Gold Valley agreed to amend the royalty terms on the Wiluna West Iron Ore Project. The revised royalty structure introduces a sliding scale based on the IODEX iron ore price, with payments ranging from zero to A$2.00 per dry metric tonne depending on price thresholds. This adjustment aims to balance royalty income with market realities over the next two years.

Acquisition Pipeline and Corporate Activity

GWR remains actively engaged in evaluating potential acquisitions that offer existing infrastructure and near-term cash flow. The company is focused on advanced-stage projects across a range of critical and strategic minerals, including gold, copper, rare earth elements, and lithium. This disciplined approach aligns with GWR's objective to deliver transformational shareholder value while maintaining financial prudence.

During the quarter, GWR issued new shares under its Employee Incentive Plan, reflecting ongoing commitment to rewarding performance and retaining key personnel. Exploration expenditure totaled $479,000, primarily directed towards Prospect Ridge activities and due diligence efforts.

Outlook

With government support for critical minerals and a growing global demand for magnesium and tungsten, GWR is well positioned to capitalize on these trends. The company’s focus on operational excellence, strategic investments, and disciplined growth initiatives sets a promising stage for the next phases of development and value creation.