en.Wedoany.com Reported - Hillgrove Resources has approved Emily Star as the third underground mining front at its Kanmantoo copper mine in South Australia, aiming to boost copper production. The project's development capital is estimated at A$20–22 million, funded by operating cash flow, with extraction targeted for the second half of 2027 to support operational flexibility and a run rate of 2 million tonnes per annum.
Board approval was based on drilling results from the upper section of Emily Star, which confirmed geological continuity and grade distribution consistent with the existing block model. Hillgrove Resources (ASX:HGO) stated that no significant stratigraphic stability issues were identified that would hinder development or future extraction. Emily Star has now entered the development phase, with completion capital estimated at A$20–22 million, in addition to the A$2.9 million already spent on drilling and pre-engineering. The company plans to invest A$6.5–7.5 million in the project during the second half of 2026, with extraction scheduled for the second half of 2027. Results from the upper section drilling will be incorporated into Hillgrove's resource and reserve update for the December quarter.
HGO CEO and Managing Director Bob Fulker stated that the approval of Emily Star is another step toward unlocking the larger Kanmantoo system. Fulker noted that the drilling completed to date has validated the geological model, giving the company confidence to proceed with development. Emily Star provides an additional mining front, enhancing operational flexibility and supporting sustained copper production over the mine's life. The investment will be funded by operating cash flow as Kanmantoo continues to build momentum in 2026.
Emily Star joins Kavanagh and Nugent as the third underground mining front at Kanmantoo, offering greater flexibility in ore production scheduling. It will replace some deeper Kavanagh production and help maintain the mine's target run rate of 2 million tonnes per annum. A higher plant throughput rate spreads fixed costs over a larger production base, thereby supporting lower all-in sustaining costs. Emily Star's average planned stope size is approximately 35,000 tonnes, consistent with the larger-scale Kanmantoo underground operations. The development plan includes stopes, decline works, access infrastructure, ventilation shafts, and an escapeway network.
Hillgrove has revised its 2026 major capital guidance from A$8–10 million to A$15–17 million, with the increase reflecting the start of Emily Star development and ongoing work on the Mutooroo Stage 1 pre-feasibility study. The company stated that the revised guidance remains fully funded by operating cash flow. Emily Star requires more capital than Nugent due to the need for additional ventilation shafts and access infrastructure for development.
Kanmantoo's 2025 mineral resource stands at 22 million tonnes at 0.74% copper, 0.17 g/t gold, and 2.3 g/t silver, containing 160,000 tonnes of copper and 120,000 ounces of gold. This includes Emily Star's inferred resource of 2.6 million tonnes at 0.77% copper, 0.08 g/t gold, and 1.6 g/t silver, containing 20,000 tonnes of copper and 7,000 ounces of gold. Results from the upper section drilling will be incorporated into the December quarter resource and reserve update. Current ore reserves total 4 million tonnes at 0.85% copper and 0.22 g/t gold, with Kavanagh and Nugent combined containing 34,000 tonnes of copper and 29,000 ounces of gold.
Emily Star development will proceed under Kanmantoo's existing Program for Environment Protection and Rehabilitation (PEPR). Hillgrove plans to submit a full PEPR update later this year, with approval expected before the start of extraction in the second half of 2027. Mine planning adopts conservative ground support and decline advance rates. Logging and structural interpretation indicate variable conditions but consistent with Kanmantoo's typical characteristics, with no geotechnical risks identified that would hinder development or extraction.
Additionally, Hillgrove will seek shareholder approval at the upcoming general meeting to change the company name to Kantra Copper Limited and implement a 15-for-1 share consolidation. The company stated that the name "Kantra" combines "Kan" from Kanmantoo and "tra" from a variant of Terra, linking the brand to the mine and signaling a broader, forward-looking vision. The proposed change comes at a time when copper has become the most important metal for investors, with mining giants such as BHP, Rio Tinto, Glencore, and Anglo American all aligning investment decisions around increasing copper production. As a key material for electrification, renewable energy, and artificial intelligence, copper prices are near historical highs at approximately US$13,600 per tonne. The company stated that the consolidation will not change shareholders' proportional ownership and is not a precursor to financing, but it is expected to improve liquidity and bring the company's share price into a more conventional range. The company remains cash positive and will maintain a disciplined capital allocation approach, balancing growth investments with the potential for dividends as the business matures.
