Safety Concerns Surface as Aurelia Metals Advances Growth Projects

Strong Production and Cash Flow Drive Confidence

Aurelia Metals Limited (ASX – AMI) reported a solid second quarter for FY26, with group metal production reaching 11,671 ounces of gold, alongside significant volumes of copper, zinc, and lead. The company’s Cobar Region operations generated an impressive operating cash flow of $42.9 million, a substantial increase from the previous quarter’s $8.3 million, underscoring the strength of its mining and processing activities.

Despite investing $10.5 million in growth projects and paying $12.2 million in taxes related to FY25, Aurelia maintained a healthy cash balance of $85.6 million. This financial robustness supports the company’s ongoing expansion plans and operational commitments.

Federation Mine and Processing Plant Performance

The Federation Mine continues to ramp up ahead of schedule, with mine development metres slightly lower than the prior quarter but ore mined increasing to 76,000 tonnes. Notably, ore grades improved significantly, with zinc rising to 8.18%, lead to 4.61%, and gold to 1.23 grams per tonne, reflecting successful access to higher-grade zones.

At the Peak processing plant, throughput remained near its current capacity limit of 800,000 tonnes per annum, processing 187,000 tonnes this quarter. Metal recoveries remained excellent, with gold recovery at 94%, zinc at 84%, lead at 89.6%, and copper at 88.2%, maximising metal output and revenue potential.

Growth Projects on Track to Boost Capacity

Aurelia’s growth initiatives are progressing well, with the Great Cobar Project advancing steadily at 506 metres of development this quarter. The project remains on track for first ore production around FY28. Meanwhile, expansion projects at the Peak plant; including a new thickener and tertiary ball mill; are on schedule to increase throughput capacity to between 1.1 and 1.2 million tonnes per annum in the first half of FY27.

These upgrades are expected to enhance metal recoveries and reduce operational costs, positioning Aurelia to meet its ambitious target of 40,000 tonnes of copper equivalent production by FY28.

Safety and Governance Updates

On the safety front, the company recorded four reportable injuries this quarter, primarily hand injuries and slips involving short-term contractors. Management has responded with targeted safety programs, including a behavioural safety initiative and enhanced field leadership, aiming to prevent future incidents.

Governance changes include the stepping down of Chair Peter Botten and the appointment of Bruce Cox as Interim Chair. The Board is actively searching for a permanent Chair, while director Franklyn Brazil resigned in December, with no immediate replacement planned.

Exploration and Regional Activities

Exploration efforts continue across Aurelia’s Cobar Basin tenure, with underground and surface drilling programs underway at several prospects including Federation, New Occidental tailings, and regional targets like Stone’s Tank and Dominion. Assay results are pending, with further analysis expected to inform resource updates and future development plans.

Overall, Aurelia Metals appears well-positioned to deliver on its FY26 production and financial guidance, while laying the groundwork for sustained growth through FY27 and beyond.