Hillgrove raises bar with 21% increase in copper metal mined at Kanmantoo in January

Hillgrove Resources reports a 21% uplift on in situ copper mined and more physical improvement at Kanmantoo in January.

Hillgrove believes there is plenty of weight remaining at Kanmantoo. Pic: Getty Images

• Hillgrove Resources reports physical improvements from its Kanmantoo copper mine

• Company stands as one of few producing copper plays on the ASX

• Belief remains firm in extensive exploration potential around Kanmantoo

Special Report: Hillgrove Resources has dramatically accelerated underground production at the Kanmantoo mine in January, in a sign the South Australian operation is ramping up at pace.

The mined figure of 1,074t of in situ copper is up more than a fifth from the December quarter average, with Hillgrove Resources (ASX:HGO)  saying the physicals of its Kanmantoo mine have continued to improve.

That came as development and ore mined increased 7% from 540m to 576m and 11% from 104,000t to 115,000t respectively.

While 99,000t of processed ore is down 10% due to the milling sequence, the ore tonnage mined from the stopes have seen a significant increase to processing grade.

Hillgrove CEO and managing director Bob Fulker said he was pleased to report a production update which clearly demonstrates an operational improvement.

“In particular, the in-situ copper tonnes mined were up 21% compared to the December 2024 quarter monthly average,” Fulker said

“In accordance with plan, stope production in January increased significantly, with grade processed increasing 13% to 0.97%.”

“The ore tonnes processed in the month are in line with our campaign milling schedule, with surface stocks at month end being circa 18,000 tonnes.”

Those higher grades saw copper production from the plant rise 3% to 903t in January, up from 879t in the December quarter average, with recoveries also lifting slightly from 93.5% to 93.9%.

January 2025 Production Comparison to December 2024 Quarter monthly average. Pic: HGO

Claiming Kanmantoo

Located in SA mining heartland between Callington and Kanmantoo, less than an hour’s drive southeast of Adelaide, Hillgrove acquired then resumed exploration around the old open-pit mine in 2004.

Drilling success led to a decade of open-pit operations from 2010 to 2020 before being put on care and maintenance.

But Hillgrove quickly found about a million tonnes of resource in underground lodes beneath the main pit, leading to more drilling, a four-year mine plan, a final investment decision and a return to production.

Hillgrove’s last update almost doubled its resources, and it secured a $10m debt facility in October to continue its ramp-up with eyes also on drilling for a major new discovery on ~4,200km2 of surrounding exploration ground that remains startlingly underexplored.

Red metal arrears

Copper producers are few and far between on the ASX since OZ Minerals was snapped up by BHP, leaving billions in mid-tier funding without a home.

Sandfire Resources (ASX:SFR) still stands independent of the majors, but it has shifted jurisdictions from WA to Spain and Bostwana. ASX copper producers are harder to find in the gap between large caps and small explorers where value is normally found by investors.

While Hillgrove’s Kanmantoo is more modest in scale at the moment, the likes of BHP’s Olympic Dam, Prominent Hill, and Carrapateena offer proof that South Australia remains tier-one red metal territory.

Hillgrove believes the area around its operating mine still has plenty of meat on the bone as it looks to expand Kanmantoo, generate cash and make a new discovery.

Copper market dynamics also fall in its favour. While macroeconomic concerns have kept “Dr Copper” in check, prices of over US$9000/t remain high by historic standards, and numerous analysts think rising demand and a shortage of new operations will eventually push prices for the commodity beyond US$11,000/t.

The Kanmantoo copper mine. Pic: HGO

This article was developed in collaboration with Hillgrove Resources, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.