Foreclosure dispute threatens Celsius access to flagship copper project

MMCI dispute drives Celsius into a financial and strategic squeeze

Celsius Resources Limited (ASX:CLA) has put a number on the cost of its Philippine ownership battle: a A$23.4 million net loss for FY2026, more than three times the prior year’s A$7.6 million loss. The result includes a A$30.7 million impairment charge and arrives after Celsius lost control of Makilala Mining Company Inc (MMCI), the vehicle holding the MCB copper-gold project.

The accounting change followed a 20 April 2026 meeting at which Sodor representatives took all five MMCI board seats and terminated key executives, according to the annual report. Celsius now records a 40% interest as an associate, but has impaired both that investment and a related loan to nil. The company says it disputes the validity of the subsequent foreclosure process and is pursuing court appeals and arbitration.

The dispute moved from boardrooms to an auction after Equinaire Holdings, a Kiri Industries subsidiary, claimed events of default under the Omnibus Loan and Security Agreement. On 8 September, Equinaire submitted a US$5.01 million credit bid and was declared the winner after no other registered bidders submitted offers. Celsius says the result remains subject to the pending arbitration and disputes Equinaire’s capacity to foreclose or transfer the MMCI interest.

MCB economics remain substantial, but funding is unresolved

That legal uncertainty sits against a project study with sizeable headline economics. Celsius’ completed definitive feasibility study models a 35.3-year mine life, US$276 million of initial capital and a post-tax net present value of US$771 million at an 8% discount rate. The study forecasts a 24.1% post-tax internal rate of return and 4.7-year payback from production across the life of mine.

Those figures are study outputs, not operating results. They assume copper prices of US$4.30 a pound for the first nine years and US$7 a pound thereafter, with gold assumptions of US$3,000 an ounce and US$4,500 an ounce respectively. The next practical steps include underground mine optimisation, an engineering, procurement and construction tender for the process plant and work on power supply.

Celsius raised about A$9.3 million before costs during the March quarter through 465 million shares issued at A$0.02, with attaching options. Cash stood at A$7.2 million on 30 June, while operating and investing activities consumed A$17.1 million during the year. The directors say the company has sufficient resources for its obligations over the 12 months from authorisation of the accounts, but the report also acknowledges that further financing is required for exploration and development.

Opuwo sale offers a potential funding bridge

The proposed sale of Celsius’ 95% interest in Namibia’s Opuwo cobalt-copper project to Chinalco (Xiong’an) Mining for US$15 million is therefore more than a portfolio tidy-up. The transaction is intended to provide near-term funding and allow Celsius to concentrate on its Philippine copper-gold assets, but it remains subject to conditions and is targeted to complete before 29 December 2026.

Celsius is also turning greater attention to the Sagay Copper Project, where it reports a 312 million tonne resource grading 0.39% copper and 0.11 grams per tonne gold. A smaller shallow supergene deposit is proposed as a first phase, subject to community support and further technical work, while the larger porphyry resource would require a later underground development. None of that changes the immediate question facing shareholders: whether Celsius can secure control, financing and a workable ownership structure for MCB before its cash runway becomes the more pressing constraint.