Hillgrove Cuts 2025 Copper Guidance to 11,000–11,500 Tonnes After Nugent Completion
Hillgrove Resources has completed its Nugent Acceleration Project ahead of schedule, boosting underground development and early ore processing. However, the company has lowered its 2025 copper production guidance and raised cost estimates due to geological challenges.
- Nugent Acceleration Project completed early with 6,167 tonnes of ore processed in August
- 1,112 metres of underground development achieved from April to August
- 2025 copper production guidance revised down to 11,000–11,500 tonnes
- All-in costs increased to US$4.20–4.45 per pound payable sold
- Emily Star drilling underway with assay results pending
Nugent Project Completion Ahead of Schedule
Hillgrove Resources Limited (ASX – HGO) announced the successful completion of its Nugent Acceleration Project in early August, marking a significant milestone in its Kanmantoo copper mine operations. The project delivered 6,167 tonnes of ore processed from the Nugent development level, with underground workings advancing 1,112 metres between April and August. Only 286 metres remain to connect the Nugent incline and decline, expected to be finished in the December quarter, which will alleviate congestion in the Kavanagh mining area and improve operational efficiency.
Operational Progress and Strategic Benefits
The completion of the Nugent return air drive and Southern ore drive is nearing, enabling safer and more efficient mining access. These developments set the stage for Nugent stoping production to commence in the December quarter. According to CEO Bob Fulker, the project was delivered safely, on time, and largely within budget, underscoring the team’s operational discipline. Additionally, the Nugent development has facilitated the first drill hole at the Emily Star site, which could open a new mining front and further optimise plant utilisation once assay results are received.
Revised 2025 Production and Cost Guidance
Despite the positive progress, Hillgrove has revised its calendar year 2025 copper production guidance downward to between 11,000 and 11,500 tonnes, from the previous 12,000 to 14,000 tonnes. This adjustment reflects the impact of mining through a geological 'Pinch Zone' at Kavanagh, where grades have aligned with the Mineral Resource Estimate rather than exceeding it as previously anticipated. Concurrently, all-in costs (excluding Nugent acceleration capital expenditure) have increased to US$4.20–4.45 per pound payable sold, up from US$3.40–3.90, driven by lower payable copper volumes and sustained gross costs.
Capital Expenditure and Future Outlook
Year-to-date capital expenditure at Kanmantoo totals AUD 27.9 million, split between sustaining capital and major projects including the Nugent Acceleration Project. The company is focused on increasing mill throughput from 1.4–1.5 million tonnes per annum to 1.8 million tonnes, with Nugent and Emily Star developments playing a key role in this strategy. CEO Fulker remains confident that as mining progresses beyond the 'Pinch Zone,' grades and production rates will improve, helping to reduce unit costs over time.
Looking Ahead
While the Nugent Acceleration Project’s early completion is a clear operational win, the revised guidance highlights the challenges of underground mining and resource variability. Investors will be watching closely for the upcoming Emily Star assay results and the December quarter’s production ramp-up to assess whether Hillgrove can regain momentum and meet its longer-term growth targets.
Bottom Line?
Hillgrove’s early project success is tempered by lower 2025 output and higher costs, setting a cautious tone for the near term.
Questions in the middle?
- What will the Emily Star drill assays reveal about future mining potential?
- How quickly can Nugent production ramp up to offset the 'Pinch Zone' impact?
- Will cost pressures ease as throughput increases and grades improve?
