Heavy Minerals Seals Hillgrove Deal, Eyes $35m for Garnet Expansion
Heavy Minerals Limited has finalized a binding agreement with Hillgrove Resources to extract garnet from tailings, while advancing its Port Gregory project and targeting substantial capital raising.
- Binding agreement signed with Hillgrove Resources for garnet extraction
- IHC Mining provides plant designs for 50,000 tonnes per annum garnet production
- Port Gregory Pre-Feasibility Study nearing completion, due Q3 2026
- Capital raising discussions underway targeting $25-$35 million
- Recent funding includes $165K from royalty options and $175K via ATM facility
Binding Agreement with Hillgrove Resources
Heavy Minerals Limited (ASX – HVY) has taken a significant step forward in its industrial minerals ambitions by finalizing a binding agreement with Hillgrove Resources. This deal, executed shortly after the December quarter, grants Heavy Minerals the right to extract Hard Rock Almandine Waterjet Garnet from Hillgrove’s existing tailings stream at the Kanmantoo Copper Gold Mine in South Australia. The agreement outlines operational and permitting frameworks, developed in close consultation with South Australia’s Department of Energy and Mines, setting the stage for near-term production.
Advancing Plant Design and Production Capacity
Complementing the agreement, Heavy Minerals has received firm pricing and detailed plant designs from IHC Mining for a modular wet and dry garnet processing facility capable of producing 50,000 tonnes per annum. This facility, strategically located adjacent to the Kanmantoo processing plant, represents a scalable production platform that Heavy Minerals may acquire upon a positive financial investment decision. The modular design reflects industry best practices and positions the company to efficiently enter the garnet market.
Port Gregory Garnet Project Pre-Feasibility Study
Meanwhile, the company’s flagship Port Gregory Garnet Project in Western Australia is progressing steadily, with the Pre-Feasibility Study (PFS) now in its final review stage. The PFS, expected to be released in the third quarter of 2026, builds on prior scoping and economic assessments, aiming to refine the project’s technical and financial parameters. Led by IHC Mining’s experienced team, the study adheres to rigorous industry standards, promising a comprehensive evaluation that could unlock significant value for shareholders.
Capital Raising Efforts and Financial Position
Heavy Minerals is actively engaging with multiple funding sources to secure between $25 million and $35 million in capital. The company envisions a blend of debt, pre-sales, and royalty arrangements to finance its expansion plans. During the quarter, it raised $165,000 through the conversion of royalty options and an additional $175,000 post-quarter via its At-The-Market (ATM) facility. Despite closing the quarter with a modest cash balance of $38,000, the company’s strategic funding initiatives aim to underpin its operational and development activities moving forward.
Outlook and Strategic Positioning
Executive Chairman Adam Schofield expressed confidence in the company’s trajectory, highlighting the Hillgrove agreement as a pivotal milestone that accelerates Heavy Minerals’ entry into the garnet market ahead of the Port Gregory project’s development. The company’s methodical approach to project advancement, combined with its proactive capital raising, signals a clear pathway toward near-term production and value creation. Shareholders are encouraged to anticipate the upcoming PFS release and further funding updates as key catalysts in the coming months.
Bottom Line?
Heavy Minerals is positioning itself for a breakthrough in garnet production, but funding execution and PFS outcomes will be critical next steps.
Questions in the middle?
- What are the detailed financial terms and royalty structures of the Hillgrove agreement?
- How will the company balance debt, pre-sales, and royalties in its $25-$35 million capital raise?
- What operational timelines and production targets will the Port Gregory PFS reveal?
