REZ’s $2M Capital Raise Sets Stage Amid Exploration Risks at East Menzies

Exploration Momentum Builds at East Menzies

Resources & Energy Group Limited (ASX – REZ) has entered 2026 with renewed momentum at its flagship East Menzies Gold Project in Western Australia. The company has commenced a reverse circulation (RC) drilling program focused on testing extensions to known mineralisation at the Gigante Grande and Goodenough deposits, both key components of its growing resource base.

The drilling campaign aims to validate a recently defined JORC-compliant Exploration Target for the Gigante Grande Central Domain, which estimates between 4.0 to 5.0 million tonnes grading 1.3 to 3.0 grams per tonne gold, potentially containing 160,000 to 500,000 ounces of gold. This target is exclusive of the existing inferred resource of approximately 40,700 ounces, highlighting significant upside potential within a relatively small portion of the overall mineralised strike.

Supporting Exploration with Advanced Techniques

Complementing the drilling, REZ has completed a comprehensive soil sampling program across underexplored northern and eastern areas of the project, where surface cover has historically limited exploration. These samples will undergo multi-element analysis, including the CSIRO-developed UltraFine+ method, designed to detect concealed gold mineralisation beneath thick saprock and sheetwash layers.

Additionally, a LiDAR and high-resolution aerial photography survey has been conducted over the entire East Menzies tenement package. This survey will provide a consistent and accurate topographic dataset, resolving discrepancies from previous piecemeal surveys and enhancing structural interpretation to better target future drilling.

Funding the Next Phase of Growth

In December 2025, REZ successfully completed a $2 million placement to sophisticated and professional investors, issuing shares at $0.014 each. This capital injection bolsters the company’s balance sheet, providing the necessary funds to advance drilling, resource expansion, and near-term production growth. The company ended the quarter with $2.3 million in cash, positioning it well to execute its exploration and development plans.

The placement also included options exercisable at $0.04, subject to shareholder approval, which is expected to be sought by mid-March 2026. Directors have indicated their intention to participate in the placement, further aligning management with shareholder interests.

Towards Sustainable Gold Production

REZ’s strategy at East Menzies is to build a sustainable gold production platform by systematically expanding its resource base while progressing mining and processing initiatives. The Goodenough deposit, historically mined underground with high-grade results, is being revisited with drilling aimed at extending mineralisation and improving resource confidence. Metallurgical test work is planned to confirm recovery rates, building on promising results from previous campaigns.

The company’s geological model highlights a combination of near-surface supergene enrichment and deeper in situ granite-hosted gold associated with the Moriarty Shear Zone. This structural setting supports the potential for bulk open-pit mining with relatively low strip ratios, enhancing the economic viability of the project.

As REZ advances its exploration and development programs, the integration of new drilling data, soil geochemistry, and topographic mapping will be critical to refining targets and unlocking the full potential of the East Menzies Gold Project.