Vault Minerals is on track to meet FY26 production targets with a strong focus on expanding its King of the Hills operation and progressing a merger with Regis Resources, positioning itself as a senior gold producer.
- FY26 production on track with 306,542 ounces YTD
- KoTH plant expansion ahead of schedule and budget
- Exploration success supports life-of-mine extensions
- Merger with Regis Resources to create 700kozpa producer
- Sugar Zone restart regulatory approval progressing
FY26 Production Momentum and Capital Investment
Vault Minerals (ASX:VAU) is delivering on its FY26 production guidance with 306,542 ounces produced year-to-date as of 31 May 2026, supported by its Leonora, Mount Monger, and Deflector operations. The company is investing heavily in capital projects, with a near-term focus on the King of the Hills (KoTH) plant expansion, which accounts for around 70% of FY26 capital expenditure. This investment aims to boost throughput by approximately 50% to 7.5-8.0 million tonnes per annum, lowering unit costs and reinforcing KoTH as the dominant processing facility in the Leonora district.
At Deflector, Vault has transitioned to an owner-operator model to improve cost control and operational flexibility, with underground mining ramping up and new mining fronts like the Spanish Galleon and Contact Lode poised to extend mine life. Exploration remains a key pillar, advancing high-value targets both in-mine and near-mine to underpin future growth.
KoTH Expansion and Underground Growth Potential
The KoTH operation stands out as a cornerstone asset with a 2.8 million ounce Ore Reserve offering an 18-year life of mine. Stage 1 of the plant upgrade completed in January 2026, and Stage 2 is progressing ahead of schedule and on budget, with commissioning expected by September 2026. The upgrade includes a new crushing circuit and a 9MW regrind ball mill, targeting a throughput increase to 7.5-8.0 Mtpa.
Underground drilling at KoTH is extensive, with 346 drill holes completed in FY26 to date, targeting reserve conversion, resource extensions, and new structural zones such as Imperial and Sandsnake. High-grade intersections reported recently, including 7.6m at 31.7 g/t and 5.1m at 25.8 g/t, suggest significant upside potential to extend mine life and production rates beyond current plans.
Mount Monger and Deflector Operations Supporting Growth
Mount Monger, with a 0.6 million ounce Ore Reserve and a 9-year processing life, is benefiting from increased waste stripping and declining strip ratios at the Santa Open Pits, which should improve cash margins over time. The Daisy underground is expected to deliver approximately 10% year-on-year production growth in FY27, while the Rumbles open pit offers additional upside leverage to gold prices and exploration success.
Deflector’s transition to owner-operator status has already delivered improved underground performance. Access to the Spanish Galleon mining front has been established, with stoping scheduled to commence in Q1 FY27. Exploration drilling along the Gullewa corridor, approximately 7km from Deflector, aims to validate and extend Mineral Resources, potentially adding new feed sources for the mill.
Sugar Zone Restart Advances with Regulatory Milestones
Vault is progressing the restart of its Sugar Zone underground mine in Ontario, with the submission of a Closure Plan Amendment for the Southern Tailings Management Facility in June 2026 marking a key regulatory milestone. This approval is the last major hurdle before underground development recommences in Q1 FY27, with gold production targeted for Q1 FY28. The operation boasts a high-grade 389,000 ounce Ore Reserve and upgraded infrastructure, including new crushing and screening circuits and enhanced water treatment facilities.
Surface stripping and exploration programs are underway to define additional high-grade shoots along strike, supporting ongoing conversion and discovery potential. Senior site leadership appointments are advancing, setting the stage for a successful ramp-up.
Merger with Regis Resources to Create Senior Gold Producer
Vault Minerals has agreed to merge with Regis Resources through a scheme of arrangement, forming a combined entity with annual production exceeding 700,000 ounces. Under the deal, Vault shareholders will receive 0.69472 Regis shares per Vault share, with Regis shareholders owning approximately 51% and Vault shareholders 49% of the merged company.
The merger, unanimously recommended by both boards, will create a debt-free balance sheet with significant cash reserves, enhancing operational resilience and shareholder returns. The combined board will be evenly split, with Russell Clark appointed Chair and Jim Beyer as CEO. The transaction is subject to shareholder, court, and regulatory approvals, with implementation expected between August and September 2026.
Financial Performance and Capital Management
Vault’s H1 FY26 results highlight strong operational leverage, with revenue up 20% to $817 million and EBITDA rising 44% to $385 million despite a 15% decline in gold sales volume, reflecting a 34% increase in average realised gold price. The company declared its maiden interim dividend of 7 cents per share, deploying $33 million in a buyback program to date. Vault maintains a robust cash position of $537 million and zero debt, underpinning its capacity to fund growth projects and shareholder returns.
Bottom Line?
Vault Minerals is positioning itself for sustained growth through strategic capital investment, exploration success, and a transformative merger, but investors should watch regulatory approvals and integration risks as key upcoming catalysts.
Questions in the middle?
- Will the Sugar Zone restart meet its Q1 FY27 timeline amid regulatory and operational challenges?
- How will the merger with Regis Resources influence Vault’s growth strategy and capital allocation?
- Can exploration success at KoTH and Deflector translate into meaningful extensions to mine life and production?