Simberi Production Shortfall and Tax Uncertainty Cloud St Barbara’s Expansion Plans

Simberi Expansion Project Progress

St Barbara Limited continues to advance its flagship Simberi Expansion Project on Simberi Island, Papua New Guinea, with the feasibility study nearing completion and expected to be announced in the second quarter of FY26. Early works are well underway, including expansion of camp capacity, procurement of a 5.8MW ball mill, geotechnical drilling, and detailed haul road design. The company has also expanded its mobile mining fleet, with new Volvo A60 trucks arriving to improve operational capacity.

Importantly, the Papua New Guinea Mining Advisory Committee has recommended extending the Simberi Mining Lease 136 until 2038, a critical regulatory milestone now awaiting the Mining Minister's decision. This extension is essential for the project's long-term viability and underpins the company’s 13-year life of mine plan.

Operational Challenges and Production Update

Despite these developments, Simberi's gold production in Q1 FY26 was 11,158 ounces, falling short of forecasts. The shortfall is attributed primarily to lower than expected ore grades and persistent issues with mine fleet availability and maintenance. However, the arrival of additional trucks in October and improved contractor fleet performance signal a positive turnaround. The All-In Sustaining Cost (AISC) was reported at A$4,487 per ounce, reflecting operational pressures.

Cash flow from operations contributed A$14 million during the quarter, supported by gold sales and bullion holdings. The company maintains a strong financial position with total cash, bullion, receivables, and listed investments amounting to A$157 million, free of bank debt and hedging obligations.

Atlantic Gold Projects and Permitting Advances

On the Atlantic front, the pre-feasibility study for the 15-Mile Processing Hub in Nova Scotia remains on schedule for completion in Q3 FY26. Notably, improved permitting conditions have allowed St Barbara to withdraw litigation and explore reopening the Touquoy mine to process low and medium grade stockpiles. This potential restart could provide near-term cash flow and bolster the regional economy without impacting the broader development timeline.

Exploration and Resource Definition

Exploration efforts at Simberi and surrounding islands continue to yield encouraging results. The FY25 drilling program, including diamond drilling, trenching, and reverse circulation drilling, has identified significant gold mineralisation in multiple zones such as Pigibo North, Pigiput-Sorowar Northeast Trend, and Samat. Assay results indicate promising grades and widths, supporting ongoing resource definition and sterilisation drilling. Further drilling is planned to refine these targets and assess economic potential.

Financial Strength and Capital Raising

Following the quarter, St Barbara successfully completed a A$58 million institutional placement to fund growth capital projects at Simberi and Atlantic. These funds will accelerate fleet expansion, finalize feasibility studies, and support permitting and early works. The company’s prudent financial management, including the sale of equity positions in Brightstar Resources and Peel Mining, has reinforced its liquidity and investment capacity.

Safety performance also improved markedly, with the Total Recordable Injury Frequency Rate dropping to 0.2, reflecting the company’s commitment to workplace health and safety.

While the company awaits resolution of amended tax assessments in Papua New Guinea, which currently delay the Final Investment Decision for the Simberi Expansion Project, St Barbara remains focused on advancing its development pipeline and operational recovery.