Alkane Resources Surpasses 36,000 AuEq Ounces Post-Merger, Eyes Growth
Alkane Resources reported a solid September quarter with 36,407 gold equivalent ounces produced following its merger with Mandalay Resources, maintaining its full-year 2026 production guidance despite one-off merger costs.
- September quarter gold equivalent production of 36,407 ounces
- Merger with Mandalay Resources completed in early August
- Strong cash and investment position of A$191 million after debt repayment
- FY2026 production guidance reaffirmed at 160,000–175,000 AuEq ounces
- All-in sustaining costs forecast between A$2,600 and A$2,900 per AuEq ounce
A Quarter Marked by Integration and Production
Alkane Resources Ltd has reported its September 2025 quarterly production update, revealing a combined output of 36,407 gold equivalent ounces (AuEq oz) from its three operating mines. This production figure reflects the first full quarter following the completion of Alkane’s merger with Mandalay Resources in early August, which added the Costerfield and Björkdal mines to Alkane’s portfolio alongside its existing Tomingley operation.
The quarter saw Alkane produce 18,335 ounces of gold from Tomingley, 9,492 AuEq ounces from Costerfield (including 8,612 ounces of gold and 198 tonnes of antimony), and 8,580 ounces of gold from Björkdal. The statutory production figures, which only account for the period post-merger completion, were naturally lower but still significant, underscoring the immediate operational contribution of the acquired assets.
Financial Position Strengthened Despite One-Off Costs
On the financial front, Alkane closed the quarter with a robust balance sheet, holding A$191 million in cash, bullion, and listed investments. This strong liquidity position was achieved after repaying A$45 million in debt and absorbing A$25 million in one-off transaction costs related to the Mandalay merger. The company also completed hedging contracts for 7,250 ounces of gold, reflecting prudent risk management amid volatile commodity prices.
Managing Director Nic Earner highlighted the significance of these developments, emphasizing the solid foundation Alkane now enjoys as a multi-mine operator across Australia and Sweden. The merger not only expanded Alkane’s production base but also diversified its commodity exposure with the inclusion of antimony from Costerfield, a metal increasingly sought after for industrial applications.
Guidance and Growth Prospects Remain Intact
Importantly, Alkane reaffirmed its FY2026 production guidance, targeting between 160,000 and 175,000 AuEq ounces at an all-in sustaining cost (AISC) range of A$2,600 to A$2,900 per ounce. This guidance suggests confidence in operational stability and cost control despite the integration challenges typical of a major merger.
Looking ahead, Alkane continues to invest in exploration and development, notably at its Boda-Kaiser gold-copper porphyry project in New South Wales. The company’s ongoing near-mine exploration programs at all three mines aim to extend resource life and enhance production profiles, positioning Alkane for sustained growth in a competitive market.
While the merger-related one-off costs have impacted short-term profitability, the strategic benefits of scale, diversification, and a strengthened balance sheet are clear. Investors will be watching closely for the full quarterly report due later this month, which will provide further detail on operational performance and integration progress.
Bottom Line?
Alkane’s post-merger production and financial resilience set the stage for a pivotal year ahead, with market watchers keen to see how integration and exploration translate into value.
Questions in the middle?
- How will the integration of Mandalay’s assets impact Alkane’s operational efficiency and cost structure over the next quarters?
- What are the exploration results and development timelines for the Boda-Kaiser project and their potential impact on Alkane’s resource base?
- How sensitive is Alkane’s production guidance and AISC to fluctuations in gold and antimony prices amid global market volatility?
