Kaiser Reef clears Auramet debt as Maldon drilling expands

Cash Position Strengthens as Auramet Loan Ends

Kaiser Reef Limited (ASX:KAU) closed the September quarter with A$33.1 million in cash and A$6.9 million in bullion, taking its combined position to A$40.0 million. Underlying cash flow was A$5.6 million, with A$2.8 million directed to debt and deferred payments and the balance lifting cash and bullion by A$2.8 million.

The company also completed the final 104-ounce delivery to Auramet International after quarter end, retiring the 1,872-ounce senior secured gold loan originally used to help fund the Henty acquisition. The repayment was funded entirely from Henty operating cash flow. Kaiser had made three 104-ounce repayments during the quarter, while a further 150 ounces went towards deferred payments owed to Catalyst Metals (ASX:CYL), leaving 2,450 ounces outstanding under that arrangement.

The balance sheet milestone had been flagged in Auramet loan repayment, which reported that Kaiser had used Henty-generated cash to remove the recurring gold delivery obligation. The company still has A$9.0 million of drawn financing facilities at quarter end, including equipment finance and an insurance premium facility.

Henty Production Supports a Replaced Reserve Base

Henty produced 5,692 ounces of gold during the quarter from 64,719 tonnes processed at a 92.9% recovery. Maldon added 572 ounces, taking group production to 6,263 ounces. Across both operations, Kaiser sold or transferred 5,529 ounces at an average realised price of A$6,067 per ounce, including gold applied to loan, deferred payment and royalty obligations.

Henty’s all-in sustaining cost was A$4,991 per produced ounce, compared with A$5,645 per ounce at Maldon, where the operation generated a negative all-in sustaining cash flow of A$1.8 million for the quarter. Group AISC was A$5,051 per ounce. Those figures sit alongside Appendix 5B net operating cash flow of A$5.237 million; the company’s higher A$5.6 million underlying cash-flow measure uses a different presentation.

The mine’s updated resource and reserve position provides the quarter’s clearest operating anchor. Henty now carries a 198,000-ounce Probable Ore Reserve, estimated at 1.91 million tonnes grading 3.22 grams per tonne, effectively replacing depletion. Its 429,000-ounce Mineral Resource comprises 366,000 ounces of Indicated Resources and 62,000 ounces of Inferred Resources. On reserves alone, the mine life remains approximately six years, with Kaiser continuing to target annual production of about 30,000 ounces.

Union Hill Development Opens Maldon Drill Front

At Maldon, Kaiser has begun underground development at Union Hill, allowing drilling north of the existing workings into the Eaglehawk, Linscott’s, Ladies and Sailors reef systems. The first underground diamond drilling phase is targeting Linscott’s and Eaglehawk, complementing an approximately 4,350-metre surface campaign at Union Hill North, Nuggetty and Nuggetty South.

“Union Hill North with new development and drill position to target untested sections of the Eaglehawk, Linscott’s, Ladies and Sailo’s Reefs.”

“Area of heli-mag survey flight at the Maldon Gold Project over geology with known gold mineralisation locations.”

Caption and image © Kaiser Reef Limited. From “Quarterly Activities/Appendix 5B Cash Flow Report”, 26 Oct 2026.

The work advances the Union Hill underground development, which earlier marked the first underground development cut at the project in eight years. Infill soil sampling has also identified contiguous gold and arsenic anomalies along several north-south structures, with anomalism extending up to 1.5 kilometres of strike. Those results define targets for drilling, but they are geochemical indicators rather than a new resource estimate.

The exploration program has not been uniformly encouraging: three Quill diamond holes returned no significant intercepts and Kaiser does not plan further drilling at that target. A 59-square-kilometre low-altitude magnetic and radiometric survey has been completed to improve geological and structural targeting across the wider project.

Maldon Investment Keeps Spending Ahead of Production

“Approved TSF4 Footprint”

Maldon processed 31,013 tonnes during the quarter, up 16% from June, but recovery slipped to 82.0% and most feed came from the low-grade Union Hill stockpile. Kaiser is advancing the approved TSF4 tailings facility, with construction expected to begin in November, while a proposed workplan variation is intended to provide another two million tonnes of tailings capacity, equivalent to about 10 years at current plant capacity.

The company also purchased the Maldon tailings thickener, which is expected to reach site in the March 2027 quarter. At Henty, 13,911 metres of underground diamond drilling were completed across grade control, resource definition, resource extension and exploration work. The next quarter therefore presents a test of whether exploration spending and underground development can translate into additional mineable ounces, while Henty continues to carry the group’s operating cash burden.