Hillgrove Resources (ASX:HGO) has solidified its position as an ASX-listed pure-play copper producer after receiving payments from the first copper concentrate sold from its Kanmantoo mine in South Australia.
Chief Executive Officer (CEO) and Managing Director Lachlan Wallace says proceeds from copper sales will increase over the next 6 months as the production profile ramps up to steady state.
“Seeing the cash from the first copper sales hit the bank account was very gratifying. The revenues represent the execution of a strategy that commenced in 2019 centred on leveraging the existing infrastructure at Kanmantoo to develop a low capital-intensive copper mine.
Delivering first copper from the underground on time and in line with costs is a testament to the capability of the team at Kanmantoo.
Concurrently we will begin to actively grow the mine life and the annual copper production profile through exploration, starting with our substantial exploration target near the underutilised processing plant, including the recently discovered Kanmantoo Deeps target.”
Hillgrove says a ‘significant’ opportunity exists to grow the resource and mine life with further drilling.
On 12 February 2024, the $149.13 million market capitalisation company began production of the first copper concentrate from Kanmantoo, as reported by Mining.com.au.
Productionfollowed the establishment of power to the underground operation, resulting in a 65% cost reduction to power use from $0.40 kilowatt hour to $0.13 per kilowatt hour.
Further, connection to the South Australian power grid, which is supplied by over 70% renewable energy generation, ‘substantially’ reduces Kanmantoo’s carbon footprint.
Hillgrove’s Kanmantoo mine sits about 55km from Adelaide and operated as a series of open pits from 2010 to 2020, producing around 137,000 tonnes of copper and over 55,000 ounces of gold.
According to the Australian government’s December 2023 Resources and Energy quarterly report, Australia ranked second in the world for copper resources.
The report adds global copper consumption was estimated to grow by 7.3% in 2023, and that Australian copper export earnings are forecast to reach around $12.8 billion in 2023-2024. Higher Australian production and export volumes will see export earnings reach $13.4 billion in 2024-2025.
As of 31 December 2023, the company had $10.24 million cash and cash equivalents at hand, according to its latest quarterly report.
Write to Adam Drought at Mining.com.au
Images: Hillgrove Resources
