Heavy Minerals Pins A$322.8M NPV on Port Gregory Garnet Project

Port Gregory PFS Delivers Strong Economic Case

Heavy Minerals Limited (ASX:HVY) has crossed a significant milestone with the delivery of its maiden Ore Reserve and Pre-Feasibility Study (PFS) for the Port Gregory Garnet Project. The PFS, released on 29 July 2026 after quarter end, outlines an Ore Reserve of 85.5 million tonnes at 4.43% Total Heavy Minerals (THM), equating to 3.3 million tonnes of contained garnet. The project boasts a 24-year mine life and a robust post-tax net present value (NPV) of A$322.8 million, assuming an 8% discount rate.

The study estimates development capital at A$122.1 million and a post-tax internal rate of return (IRR) of 47.6%, with a life-of-mine EBITDA projected at A$1.34 billion. Peak funding requirements are approximately A$89.5 million, reflecting a relatively modest capital intensity for a project of this scale. The PFS builds on a JORC (2012) Mineral Resource of 166 million tonnes at 4.0% THM, which remains unchanged since 2023.

Kanmantoo Garnet Project Advances Engineering

Alongside Port Gregory progress, Heavy Minerals pressed forward with Front End Loading Stage 3 (FEL-3) work at its Kanmantoo Hard Rock Waterjet Garnet Project in South Australia. The FEL-3 study is advancing engineering definitions for two plant configurations: a 50,000 tonnes per annum (tpa) single train and a 100,000 tpa two-train setup. These configurations, priced by IHC Mining, underpin the company’s pathway towards a Final Investment Decision under its binding agreement with Hillgrove Resources Limited (ASX:HGO).

Red Hill Assay Results Signal Next Exploration Phase

Heavy Minerals received QXRD assay results for its Red Hill Garnet Project during the quarter. The company aims to generate a maiden Mineral Resource estimate under the JORC Code 2012 Edition, potentially progressing from an Exploration Target to an Inferred or even Indicated Mineral Resource, subject to further assessment. This marks a key step in advancing the project towards development readiness.

Market Engagement and Funding Strategy

On the commercial front, Heavy Minerals is actively engaging with prospective distributors and end-users in the waterjet and abrasiveblast garnet markets. Representative product samples have been prepared for qualification testing, a necessary precursor to binding commercial agreements. However, no binding offtake or pricing terms have been settled to date.

Funding discussions remain deliberately sequenced behind the completion of technical studies. Heavy Minerals is evaluating a range of instruments including bonds, debt, royalties, prepay and offtake-linked structures, and potentially government grants and equity. These talks are preliminary and non-binding, with counterparties requiring completed studies before advancing terms.

Cash Position and Capital Management

The company closed the quarter with a modest cash balance of A$37,000, drawing on previously announced facilities including a A$2 million At-The-Market (ATM) facility with A$1.808 million undrawn at quarter end. Royalty funding contributed A$100,000 during the quarter, supporting ongoing operations and study work. Net cash used in operating and investing activities was A$120,000, offset by A$112,000 in financing inflows.

Heavy Minerals exercised 60,000 options post-quarter, raising A$15,000 and increasing its issued capital to over 71.8 million shares. The company’s disciplined capital management and staged funding approach aim to preserve shareholder value while advancing key project milestones.