en.Wedoany.com Reported - Star Minerals (ASX:SMS) has reached a significant milestone at its Tumblegum South project in Western Australia, with its partner MEGA Resources successfully completing the first blast mining of mineralized material. The initial blasting operation has been safely completed in accordance with the mining plan, and the haulage of mineralized material and waste rock has now commenced.
This progress moves Star Minerals a step closer to generating cash flow from Tumblegum South, marking its transition toward active mining operations. Mining activities are proceeding as planned, with material being stockpiled for transport to the Plutonic processing plant under the company's toll treatment agreement with Catalyst Metals (ASX:CYL).
Over the coming weeks, mining and haulage activities will progressively ramp up, with grade control and inventory management proceeding in tandem with ongoing operational optimization. Managing Director Ashley Jones stated that mining mineralized material at Tumblegum South is a major milestone for the company, reflecting the progress made by the MEGA Resources team on site. He expressed satisfaction that mining activities have commenced safely and on schedule, and that the company is moving toward first processing at Catalyst's Plutonic plant.
Tumblegum South, located just 40 kilometers from Meekatharra, hosts a resource of 616,000 tonnes at 2.28 grams per tonne, containing 45,000 ounces of gold, of which approximately 27,000 ounces fall into the higher-confidence indicated resource category. Mining activities are being executed by MEGA Resources, which is providing up to A$20 million in working capital for the operation in exchange for a 50% profit share.
The toll treatment agreement with CYL allows for the processing of up to 250,000 tonnes of ore at the mid-tier gold miner's Plutonic plant over two years. CYL also acquired A$1 million worth of SMS shares when the agreement was signed in February 2026. MEGA's financial arm, Bain Global Resources, also holds a substantial stake in the company.
SMS previously stated it could produce between 11,800 and 15,900 ounces of gold, generating a cash surplus of A$9.49 million to A$19.6 million after covering all working capital costs (excluding pre-mining capital requirements). Potential upside has increased since that study was completed, with its assumed gold price of A$3,000 to A$3,800 per ounce well below the current spot price of approximately A$6,000 per ounce. First gold production could be a key turning point for SMS, which currently has a market capitalization of around A$9.4 million.
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