Meeka Metals Reports 6,083oz Gold Production with $15.8M Growth Capital Investment

Production Impacted by Weather and Stockpile Reliance

Meeka Metals Limited (ASX:MEK) reported a challenging March 2026 quarter as heavy rainfall and reduced productivity delayed access to high-grade open pit ore at its Murchison Gold Project. Gold production slipped to 6,083 ounces, down 34% from the previous December quarter’s 9,174 ounces, driven by an increased reliance on processing lower-grade stockpiles accumulated over the past year. The company’s processing throughput, however, improved significantly by 37% to 123,000 tonnes, despite the negative impact of high moisture content in the oxide ore blend.

Processing throughput is expected to remain stable in the June quarter before rising in September as fresher, higher-grade underground ore increasingly contributes to the mill feed. This transition is part of Meeka’s strategic shift towards underground mining, aiming to lift head grades and reduce dependence on open pit stockpiles.

Meeka’s Managing Director Tim Davidson acknowledged the frustrating production quarter but highlighted the ramp-up in processing capacity and the anticipated boost from underground ore. He noted that the company’s growth capital investments are positioning the operation for higher-grade feed and improved throughput in coming quarters.

Underground Development Accelerates at Andy Well and Turnberry

Underground mining development at Andy Well accelerated with 1,397 metres completed during the quarter, up from 1,056 metres in December 2025. The expansion opened up new work areas, improving productivity and reducing development costs to $5,723 per metre from $7,309 previously. High-grade ore recovery continued via airleg mining in upper levels, accessing zones not reachable by jumbo drills.

Preparations for a second underground mine at Turnberry advanced, with two next-generation Sandvik DD422iE development drill rigs delivered to site and power station design well underway. Portal cutting and decline development are targeted to commence in the September 2026 quarter. This development complements the company’s strategic goal to increase underground ore’s contribution to mill feed, which is expected to enhance overall grade and production consistency.

The shift towards underground mining and the associated infrastructure investments build on Meeka’s earlier efforts to increase processing capacity and efficiency, as detailed in the company’s plans for a smart ore sorting upgrade to raise throughput at Murchison to approximately 800ktpa.

Processing Plant Upgrade and Operational Costs

Meeka commenced upgrade works on its processing plant, including installation of an additional crushing circuit, a wash plant, and a Steinert multi-sensor ore sorter. Commissioning is targeted for the September 2026 quarter. This upgrade is expected to unlock significant additional processing capacity, improve head grades by removing hard waste rock, reduce plant wear, and lower tailings volume per ounce produced.

Despite the throughput increase, gold production was constrained by the lower grade of the oxide ore processed and weather-related mining delays. Processing unit costs decreased to $43 per tonne from $50 per tonne in the prior quarter, reflecting improved efficiency. However, all-in sustaining costs (AISC) rose sharply to A$4,146 per ounce, driven by the lower production and increased reliance on stockpiles.

Financial Position Strengthened Amid Growth Capital Investment

Financially, Meeka generated mine operating cash flow of A$25.8 million and net mine cash flow of A$10.0 million after investing A$15.8 million in significant non-recurring growth capital. Key investments included stripping the final stage 1 oxide open pit at Turnberry North (A$9.4 million), underground equipment and mine development (A$4.5 million), village expansion (A$0.9 million), and ore sorter purchase (A$0.7 million). The company’s cash balance rose to A$50.1 million at quarter end, up from A$37.3 million in December 2025.

Meeka remains unhedged, retaining full exposure to gold price movements, and carries no debt aside from mining equipment finance. Gold sales increased to 8,460 ounces at an average price of A$6,732 per ounce, generating sales revenue of approximately A$57 million.

This quarter’s results reflect the operational challenges posed by weather and the transitional phase towards higher-grade underground mining. The company’s continued investment in processing upgrades and underground development signals confidence in the long-term potential of the Murchison Gold Project, with the upcoming September quarter expected to show improved throughput and head grades as underground ore becomes a larger part of the blend.

Meeka’s operational update aligns with its recent strategic moves, including the acquisition of Mt Holland gold tenements and the planned 20,000-metre drilling campaign to expand resource bases and underpin future growth.

Investors will be keen to watch how Meeka manages the transition from open pit to underground mining and whether processing upgrades deliver the anticipated boost in production and cost efficiencies in the coming quarters.