Hillgrove to boost Kanmantoo copper throughput and lower costs

Hillgrove Resources posted operational gains at Kanmantoo in the June quarter with a 10.7% increase in mine development to 2,011m and ore processing up 11.7% to 353,000t.

Hillgrove owns the Kanmantoo mine in South Australia which mined 336,00t of ore during the June quarter. Pic: Getty Images

• Kanmantoo delivered $6.4m of operating cashflow in the June quarter from production of 2,593 tonnes

• Mine development increased by 10.7% quarter on quarter to 2,011m

• Hillgrove enters the second half of the year with a strong operational base

Special report: Hillgrove Resources made further operational improvements at Kanmantoo copper mine in South Australia during the June quarter, with mine development rising 10.7% to 2011m and ore processing increasing 11.7% to 353,000t.

Other quarterly metrics include lower production of 2,593t at a grade of 0.77%, the first ore mined and processed from Nugent, and significant exploration results from infill and extensional exploration drilling.

Hillgrove Resources (ASX:HGO) mined 336,000t of ore and completed 2,011m of underground development, largely driven by accelerated work at Nugent deposit targeting key bottlenecks.

The company aims to improve stope cycles to increase output in 2026.

Kanmantoo delivered $6.4 million of operating mine cashflow from production of 2,593 tonnes, delivering a C1 operating cost of $5.24 per pound sold.

Production was lower than expected due to minor issues with two of the mining areas that delayed access to higher-grade copper ore. As a result, Hillgrove’s total copper production is now tracking toward the lower end of its 2025 guidance range of 12,000 to 14,000t. Despite this challenge, the company had a strong quarter operationally and made solid progress on the Nugent acceleration project.

This work is due to conclude in the third quarter, which will see a reduction in costs once contractors are demobilised.

Mining and processing milestones faster than expected

On the financial side, HGO managing director and CEO Bob Fulker said the company completed a capital raising, which boosted liquidity to support the accelerated Nugent development and growth initiatives.

“A significant milestone was also achieved with the first ore from Nugent mined and processed ahead of schedule,” he said.

“Overall, Hillgrove enters the second half of the year with a strong operational base, a growing pipeline of resources and a clear strategy to lift production and drive long-term value creation.”

More from HGO: Hillgrove notches record copper mining metrics at Kanmantoo

Focus shifts to increasing mill throughput

Contractors kicked off work on the accelerated Nugent development in late April.

HGO said development rates had increased significantly, leading to the early intersection of the orebody via the 1020 level crosscut and the delivery of first development ore to the Kanmantoo mill ahead of the previously planned December 2025 quarter.

The company prioritised this work in the quarter to establish multiple mining fronts, enhancing operational flexibility and to position for increased mill throughput from the current 1.4Mtpa to a 1.7-1.8Mtpa run rate in the first half of 2026.

Resource and reserve estimate due Q4

On the exploration side, HGO has been actively drilling at Kanmantoo with a focused program targeting extensional and infill opportunities.

This dual approach is designed to deliver near-term value through increased geological confidence and mine planning accuracy, while also unlocking longer-term growth potential by testing the boundaries of known mineralisation.

Extensive exploration targets on the mining lease include along strike and down-dip extensions of the Kavanagh and Nugent resources, the Emily Star down dip extension as well as Valentine, Critchley and Paringa brownfields exploration.

The Coopers and North Kavanagh deposits to the north of the Kavanagh underground development also form part of the broader exploration strategy.

Significant intersections from extensional drilling during the quarter, designed to expand the resource base beyond the current footprint, include 26m at 1.21% copper and 0.27g/t gold from 299m, while infill drilling returned 13m at 2.24% Cu and 0.13g/t Au.

The infill program aims to convert existing resources into higher-confidence classifications ahead of the updated resource and reserve estimate due in Q4 2025.

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.

Originally published as Hillgrove to boost Kanmantoo copper throughput and lower costs