AIC Mines adds Jericho momentum to a major Mt Cuthbert growth bet

Jericho advances as Eloise misses quarterly plan

AIC Mines Limited (ASX:A1M) is trying to turn a production shortfall into a timing issue. The company produced 3,072 tonnes of copper in concentrate during the September quarter, below plan after delayed access to higher-grade Eloise Deeps and Lens 6 ore, a seismic event and early shutdowns required to connect the expanded processing plant.

The disruption did not prompt a guidance cut. AIC Mines retained its FY27 target of 17,500 to 18,500 tonnes of copper and 7,250 to 7,750 ounces of gold in concentrate, with full-year AISC guidance of A$4.80 to A$5.20 a pound. The company said the delayed high-grade material would be accessed later in the mine schedule, while the December quarter is expected to deliver approximately 4,500 to 4,900 tonnes of copper and 2,000 ounces of gold.

Jericho reaches first stope production

The more consequential operating milestone came from Jericho. Its first production stope, the Jolly shoot, was fired on 24 September, around two weeks ahead of schedule, and ramp-up towards an initial rate of approximately 37,000 tonnes a month is under way. Commercial production remains targeted for January 2027.

That ramp-up gives AIC Mines a second ore source just as Eloise is being expanded. Jericho processed 25,000 tonnes during the quarter and generated A$8.0 million in metal sales, with a A$5.8 million cash margin credited against project capital costs. Development reached 1,307 metres, including 542 metres of ore development, while the first Jolly stope produced approximately 7,200 tonnes grading 2.2% copper. The latest drilling results were consistent with the existing resource model, according to the company.

Eloise expansion nears commissioning

The Eloise processing expansion to 1.1 million tonnes a year was 97% complete on construction verification at quarter-end, with dry commissioning 78% complete and wet commissioning 32% complete. Construction was effectively complete and remained on budget, although the associated cutover work caused unplanned plant shutdowns and contributed directly to the quarter's lower production.

AISC improved sharply from A$6.15 a pound in the June quarter to A$4.86, while AIC fell from A$6.49 to A$5.01. Those figures remained above the company's first-half guidance range because of lower-grade ore, higher-cost concentrate inventory and increased diesel prices. AIC Mines said current landed diesel prices were approximately A$0.50 a litre above the A$1.26 average price embedded in FY27 guidance. The report also contains a production-data discrepancy: its narrative states 1,562 ounces of gold in concentrate, while the consolidated table records 1,469 payable ounces.

Mt Cuthbert deal heads for shareholder vote

The quarter's largest strategic move now rests with shareholders. AIC Mines agreed to acquire the Mt Cuthbert Copper Project for A$120 million, comprising A$100 million in new AIC shares and A$20 million in cash. The cash component and additional work at the project are being funded partly through a A$70 million placement to major shareholder Hawke's Point at A$0.795 a share, following the previously announced Mt Cuthbert acquisition.

Mt Cuthbert adds a reported 18.67 million tonnes of resources grading 1.3% copper for 246,000 tonnes of contained copper, alongside a 2,400 square kilometre tenement package and existing infrastructure. The company is focused on the project's sulphide potential and is assessing a standalone operation, but the resources are subject to completion and there is no certainty they will become Ore Reserves. Shareholders will vote on the acquisition and placement at an extraordinary meeting on 4 November.

Exploration adds optionality, not yet certainty

Exploration supplied several high-grade headlines during the quarter. At Brumby, the company reported a 10.5-metre intercept grading 14.4% copper and 3.8 grams a tonne gold within a broader 46.4-metre interval grading 3.6% copper and 1.0 gram a tonne gold, extending a sulphide-magnetite breccia system over 500 metres of strike. Those results build on the Brumby drilling result, but the prospect remains an exploration target rather than a declared mine development.

At Eloise South, drilling returned 3.2 metres at 92.5 grams a tonne gold, including 1.2 metres at 249 grams a tonne, while Iris returned copper-bearing intersections including 12 metres at 1.0% copper. Assays remain outstanding from follow-up drilling at both prospects, as well as from Jericho extension holes and other regional targets. With AIC Mines spending A$44.3 million on investing activities during the quarter and closing with A$37.2 million in cash, the next test is whether the operating ramp-up and exploration pipeline can advance without stretching the balance sheet before Mt Cuthbert begins demanding capital.