Hillgrove Resources has reported a substantial increase in its 2025 Mineral Resource and Ore Reserve Estimates at the Kanmantoo Copper Mine, with a 43% rise in reserve tonnes and a 33% increase in contained copper metal, significantly extending the mine's operational life.
- 43% increase in Ore Reserve tonnes at Kanmantoo
- 33% growth in contained copper metal year-on-year
- 14% rise in Mineral Resource tonnage and 46% increase in contained gold
- Maiden underground Mineral Resource Estimate at Valentines deposit
- Mine life extended to April 2028 with positive economic outlook
Significant Resource and Reserve Growth
Hillgrove Resources Limited (ASX – HGO) has unveiled a robust update to its Mineral Resource Estimate (MRE) and Ore Reserve Estimate (ORE) for the Kanmantoo Copper Mine in South Australia. The 2025 Ore Reserve shows a remarkable 43% increase in reserve tonnes compared to 2024, alongside a 33% uplift in contained copper metal. This growth not only replaces mining depletion but also extends the mine life significantly, with operations now planned through to April 2028.
Detailed Mineral Resource Enhancements
The 2025 MRE reflects a 14% increase in total tonnage and a 46% rise in contained gold, driven by extensive drilling, refined geological modelling, and updated structural interpretations. Notably, the Nugent deposit experienced a 67% increase in tonnage and a 76% increase in contained copper, supported by the addition of 550kt of Measured Resource. The Valentines deposit also features prominently with the maiden underground Mineral Resource Estimate, adding 540kt to the resource base.
Operational and Technical Confidence
Hillgrove’s CEO, Bob Fulker, emphasized the strength of the Kanmantoo copper system and the technical team’s achievements. The updated Ore Reserve incorporates a shift to a copper equivalent (CuEq) cut-off basis, reflecting increased gold grades at Nugent and supporting a value-based mine design approach. Mining parameters have been refined based on actual operational data, with stope modifying factors adjusted to reflect positive grade reconciliation through the processing plant.
Economic Outlook and Mine Planning
The mine plan, commencing July 2025, schedules an average monthly haul of 127,000 tonnes of ore and development advances aligned with achieved actuals. Economic modelling forecasts total revenue of AUD 431 million against costs of AUD 342 million, yielding an estimated free cash flow of AUD 78 million. Sensitivity analyses indicate that key value drivers include copper price, copper grade, operating costs, and foreign exchange rates, with the current copper price assumption maintained at US$3.85/lb.
Risks and Future Considerations
While the update is overwhelmingly positive, Hillgrove acknowledges material risks such as groundwater inflows in the northeastern Nugent mine area, which have led to a conservative classification downgrade of some stopes. Ongoing hydrogeological studies aim to clarify these risks and inform future mining strategies. Additionally, the company continues to refine ventilation strategies and geotechnical modelling to ensure operational stability.
Infrastructure and Environmental Compliance
The Kanmantoo operation benefits from established infrastructure, including a 3.6Mtpa processing plant and fully permitted tailings storage facilities. Environmental and regulatory approvals are in place, with no significant impediments foreseen. Hillgrove maintains active community engagement and environmental management programs, reinforcing its social license to operate.
Bottom Line?
Hillgrove’s substantial resource and reserve growth at Kanmantoo sets the stage for sustained copper production, but groundwater challenges at Nugent warrant close monitoring.
Questions in the middle?
- How will ongoing groundwater studies at Nugent influence future mining plans and reserve classifications?
- What impact could fluctuations in copper and gold prices have on the economic viability of the extended mine life?
- When will the 2026 Mineral Resource Estimate update incorporate recent high-grade drilling results, particularly at Kavanagh?