Funding uncertainty threatens Ausmon’s next drilling phase

Rare Earths Targets Move Towards Grid Drilling

Ausmon Resources Limited (ASX:AOA) has identified three prospective rare earths areas across its South Australian tenements, but the next stage will depend on two less geological variables: land access and money. The Beelitz, Geranium and Jabuk targets collectively cover about 122 square kilometres, with the company planning closer-spaced drilling that could eventually support a maiden JORC-compliant Mineral Resource.

The exploration case has been built from broad road-verge aircore drilling across the Parrakie, Peake and Wilkawatt tenements. At Beelitz, February 2026 drilling returned intervals including 2 metres at 631.3 ppm TREO and 1 metre at 915.5 ppm, while earlier programs recorded results as high as 2,192 ppm TREO at Peake and 1,452.73 ppm at Parrakie. Those results are exploration intersections, not a resource estimate, and the company notes that closer drilling is required to establish the data density needed for resource studies.

Ausmon is considering an initial 10-square-kilometre grid at Jabuk and a further grid program at Beelitz. The proposed work would move from drilling along public road verges to 200-metre-to-400-metre spacing on private land, requiring agreements with landholders, community consultation and scheduling around farming operations. The company says it has begun those discussions, but drilling remains conditional on access and funding.

Base Metals Work Adds Another Funding Demand

At Enmore near Broken Hill, the company has retained the tenement and expanded its focus beyond the East Borehole prospect to Pine Creek and West Enmore. A geochemical survey began in August 2026, with laboratory results pending. East Borehole remains a longer-dated proposition: an earlier hole was halted at 192 metres before reaching its target, and the redesigned program would use RC pre-collars followed by diamond tails.

Preliminary results from East Borehole included 4 metres at 1,095 ppm zinc and 28 metres at 583 ppm zinc, alongside lead, manganese and copper readings. Ausmon says it intends to resume drilling after assessing contractor quotes and financing plans. The company has also allowed the Eureka and Mt Darling licences to expire, while relinquishing Brungle Creek to concentrate on McAlpine near Tumut and its South Australian REE portfolio.

Losses and Borrowings Put Pressure on Exploration Plans

The financial statements show the constraint plainly. Ausmon reported a $719,767 loss for the year ended 30 June 2026, cash of $104,866 and total borrowings of $1.505 million. Current liabilities of $958,515 substantially exceeded current assets of $136,631, while total equity fell to $673,769 from $1.331 million a year earlier.

Stantons issued an unmodified audit opinion but highlighted a material uncertainty related to going concern, citing the loss, operating and investing cash outflows, and a working capital deficiency of $821,884. The directors say the company can meet its commitments through available borrowings and future funding, including equity, debt or farm-outs. The $540,000 short-term loan notes due in September were refinanced on 23 September with $550,000 of new notes bearing 10.5% interest and maturing on 23 December 2026; a further $40,000 was drawn under the broader facility after year-end.