Ausgold Extends Katanning Resource with Strong Drilling and Advances Development
Ausgold Limited has reported robust drilling results that expand and upgrade the 2.44 million ounce Mineral Resource at its Katanning Gold Project, while advancing key pre-development milestones ahead of a final investment decision targeted by year-end.
- Step-out and in-fill drilling extend resource beyond 2.44Moz estimate
- Construction of workforce accommodation village underway, modules due November
- Early works agreements signed for engineering and hybrid power infrastructure
- Environmental permitting progressing with no major constraints identified
- Senior leadership appointments strengthen project delivery team
Drilling Results Highlight Resource Growth Potential
Ausgold Limited (ASX:AUC) has delivered a strong set of drilling results at its 100%-owned Katanning Gold Project (KGP) in Western Australia, reinforcing the project's potential to grow beyond the current 2.44 million ounce Mineral Resource Estimate. Step-out drilling in the Central Zone returned broad mineralised zones down-dip outside the existing resource envelope, including intercepts such as 29m at 0.89g/t Au from 159m and 9m at 2.64g/t Au from 165m. Meanwhile, in-fill drilling within the resource boundaries confirmed and locally exceeded grade expectations, with notable hits like 26m at 3.03g/t Au and 12m at 5.55g/t Au.
These results underscore the continuity of mineralisation beyond the current pit designs, with much of the new mineralisation shallow enough to remain amenable to open-pit mining scenarios. A diamond drilling rig is currently testing extensions up to 700m down-plunge, targeting electromagnetic anomalies that may indicate further resource expansion.
Pre-Development Activities Accelerate Toward Final Investment Decision
Parallel to exploration, Ausgold is advancing multiple pre-development workstreams to support a final investment decision (FID) by the end of 2026. The company has signed early works agreements with Lycopodium for detailed engineering and project execution planning, and with CrossBoundary Energy for a hybrid gas, solar, and battery power station to supply the mine. These agreements aim to reduce schedule risk and secure critical long-lead equipment ahead of FID.
Construction of the Katanning Workforce Accommodation Village is well underway under a fixed-price contract with ADD Business Group. Approximately 45% of modular units have been fabricated off-site, with delivery to the site commencing in early August and the first stage scheduled for handover by November 2026. This facility, developed on land leased long-term from the Shire of Katanning, is designed to house the early construction workforce and mitigate mobilisation risks.
Environmental Permitting Progresses with Positive Outcomes
Ausgold continues to move through environmental approvals with the Western Australian Environmental Protection Authority (EPA) and Department of Mines, Petroleum and Exploration (DMPE). Following additional information requests, the company has submitted all required flora and fauna studies, including targeted trapdoor spider habitat assessments that found no constraints within the development footprint. The Works Approval application is under full assessment, with parallel processing underway to expedite approvals.
The largely cleared agricultural nature of the site and limited native vegetation disturbance underpin a robust permitting proposition. Ausgold has also initiated a revegetation program planting local native flora to establish vegetation screens and support future land rehabilitation planning.
Senior Leadership Appointments to Drive Project Delivery
In preparation for the transition to construction, Ausgold appointed Ben Stockdale as CEO, promoting him from CFO. Stockdale brings over 25 years of resources sector leadership, including expertise in project financing. Reece Olney joined as General Manager Operations, bringing extensive operational experience across open-cut and underground mines, while John Sofield was appointed Project Director, with a strong technical and project delivery background across mining and energy sectors.
Financial Position and Next Steps
Ausgold ended the quarter with a healthy cash balance of A$87.36 million, having spent A$12.17 million on exploration and evaluation. No changes to share capital occurred during the period. The company is on track for first gold production targeted in mid-2028, with a drilling program ongoing to reduce drill spacing within the first two years of mine life to approximately 20m by 20m.
Looking ahead, Ausgold plans to complete detailed engineering and procurement for the hybrid power station, continue accommodation village construction, advance project financing, and submit key mine development proposals to regulators. Exploration results from ongoing drilling at the Central Zone and regional prospects like Moulyinning and Kraken are expected in the coming quarters.
Bottom Line?
Ausgold’s expanding resource base and proactive pre-development progress position the Katanning Gold Project for a pivotal final investment decision, though execution risks and regulatory approvals remain key hurdles.
Questions in the middle?
- Will ongoing drilling confirm sufficient resource growth to materially enhance project economics?
- How smoothly will permitting and approvals proceed given recent additional information requests?
- Can Ausgold secure project financing on favourable terms to support construction and ramp-up?
