Group 6 Metals set a new quarterly record processing 77,953 tonnes at its Dolphin Tungsten Mine, producing 21,297 MTUs of tungsten concentrate despite lower feed grades. The company strengthened its cash position to $49.5 million and commenced underground mining, aiming to improve grades and recovery in coming quarters.
- Record quarterly processing throughput of 77,953 tonnes
- Produced 21,297 MTUs of tungsten concentrate from stockpiled ore
- Underground mining commenced at quarter end, expected to raise feed grades
- Cash balance strengthened to $49.5 million with $2.5 million undrawn facilities
- Strong tungsten market supports long-term offtake agreements
Record Throughput Boosts Production Despite Lower Grades
Group 6 Metals Limited (ASX:G6M) pushed its Dolphin Tungsten Mine to a new quarterly processing high, handling 77,953 tonnes of ore in the June 2026 quarter. This is the largest throughput yet, surpassing previous quarters despite the average feed grade slipping to 0.45% WO3 from 0.56% the prior quarter. The company produced 21,297 metric ton units (MTUs) of tungsten concentrate, reflecting operational improvements that offset the lower grade stockpiled ore being processed.
Monthly production tapered slightly through the quarter, with plant feed grades declining from 0.53% in April to 0.40% in June, yet the plant maintained record volumes. The company continues to process accumulated open cut stockpiles, which at quarter end stood at 295,000 tonnes averaging 0.26% WO3, containing about 77,000 MTUs of tungsten trioxide.
Underground Mining Begins, Promising Higher Grades
At quarter end, Group 6 Metals commenced underground mining at Dolphin, marking a critical transition from open cut operations. The underground ore is expected to have a significantly higher grade of around 1% WO3, which, when blended with stockpiled ore, should boost plant feed grades and metal recovery. Executive Chairman Kevin Pallas highlighted that this blend is anticipated to deliver a "breakthrough" in concentrate production volumes, building on two years of experience managing variable feed grades.
The underground mining contract with HMR Drilling Services, secured earlier in April 2026, is now fully mobilised and operational. This contract underpins the company’s capability to sustain underground development and production, with HMR’s teams integrated into site operations. The move to underground mining aligns with the company’s strategy to extend mine life and improve output quality.
Robust Financial Position Supports Growth Plans
Group 6 Metals closed the quarter with a strong cash position of $49.5 million and $2.5 million in undrawn bridging facilities. The company repaid $800,000 of debt during the quarter, with remaining loans maturing in April 2027. Operating cash flow was robust at $40.5 million, supported by $61 million in customer receipts from selling 25,514 MTUs of tungsten concentrate.
Capital expenditure of $4.25 million during the quarter was focused on equipment and mine development to support ongoing operations and the underground transition. The company’s financial momentum and strengthened balance sheet provide a solid platform for advancing underground mine development and processing stockpiles while pursuing reinstatement of ASX trading, following the recent shareholder meeting where all resolutions were passed.
Tungsten Market Dynamics Remain Supportive
The tungsten market remains tight and strategically important, with ammonium paratungstate (APT) prices hovering around US$3,000 per MTU. Supply constraints outside China, coupled with China’s tightened export controls, have reinforced tungsten’s critical mineral status across defence, aerospace, semiconductor, and industrial tooling sectors. Group 6 Metals’ extended offtake agreements and established sales channels underpin revenue certainty amid these conditions.
Kevin Pallas emphasised the structural tightness in supply and elevated prices, noting that new Western supply projects face long lead times. This market backdrop supports Group 6 Metals’ positioning as a stable, Western supplier of tungsten concentrate from King Island, Tasmania.
Related Party Transactions and Tenement Status
The company disclosed payments totaling approximately $2.2 million to related parties during the quarter, including interest on loans and director remuneration, all conducted at arm’s length. These disclosures follow prior shareholder approvals and compliance steps. Group 6 Metals holds 100% interests in key licences and leases on King Island, including exploration licence EL19/2001, for which renewal will be sought before expiry in December 2026.
Bottom Line?
Group 6 Metals is leveraging record processing volumes and a strong cash position to transition into underground mining, setting the stage for improved feed grades and concentrate output in coming quarters.
Questions in the middle?
- How quickly will underground mining ramp-up translate into higher plant feed grades and improved metal recovery?
- What impact will sustained elevated tungsten prices have on Group 6 Metals’ revenue and profitability in FY2027?
- Will the company’s progress on ASX reinstatement unlock new capital or investor interest to support expansion?