Red Hill’s Exploration Risks: Can New Drilling Deliver on Promising Assays?

Robust Royalty Income Anchors Financial Position

Red Hill Minerals Limited (ASX – RHI) has reported a strong quarter ending December 2025, with royalty revenue from the Onslow Iron Project reaching $7.8 million. This figure aligns with the company’s forecast for the full financial year, underpinning a stable cash balance of $61.3 million despite dividend payments and exploration expenditures. The steady royalty stream from the Onslow Iron Project, operated by Mineral Resources Limited, continues to be a cornerstone of Red Hill’s financial health.

Exploration Advances at Curnamona JV – Broken Hill and Anabama Projects

Exploration activities under the Curnamona Earn-In Joint Venture with Peel Mining Limited have yielded encouraging results. At the Broken Hill Project, diamond drilling intersected over 250 metres of a prospective Broken Hill Type (BHT) lode horizon at the Dementus target, featuring lead-dominant sulphide mineralisation and anomalous zinc and silver. These findings suggest proximity to a significant mineralising vent source, prompting plans for follow-up drilling and geophysical surveys.

Meanwhile, at the Anabama Project in South Australia, assays from maiden diamond drilling confirmed extensions of copper-gold mineralisation at depth along a six-kilometre shear zone. Notably, one drillhole returned 20 metres at 0.6% copper and 0.2 grams per tonne gold, including higher-grade intervals. These results validate the potential of the Anabama region as a copper-gold target and justify further exploration.

West Pilbara Gold Target Shows Growing Potential

In Western Australia’s West Pilbara, Red Hill’s Barkley gold target continues to impress. Recent RC and diamond drilling extended the mineralised footprint to over one kilometre in strike length, with assays including 9 metres at 2.4 grams per tonne gold. The mineralisation remains open in multiple directions, and ongoing geological modelling aims to refine drill targeting. The program benefited from co-funding by the WA State Government’s Exploration Incentive Scheme, highlighting public sector support for Red Hill’s exploration efforts.

Progress on Pannawonica Iron Ore Project and Environmental Approvals

Red Hill is advancing environmental and access approvals for its Pannawonica Iron Ore Project. The company has completed consolidation of environmental technical reports and secured a key miscellaneous licence for a haul road corridor, facilitating future development. These steps are critical to unlocking the project’s 4.68 million tonnes Ore Reserve and aligning with regulatory requirements.

Dividend and Financial Discipline

Reflecting confidence in its cash flow, Red Hill paid a fully franked dividend of 6.5 cents per share during the quarter. The company’s disciplined approach balances ongoing exploration investment with shareholder returns, maintaining a strong cash position to support future growth initiatives.