Hillgrove to pursue growth at Kanmantoo after capital raising

Hillgrove Resources (ASX:HGO) is expecting a downhole electromagnetic (EM) and magnetotelluric (MT) surveys will occur in April 2024 to further define the Kanmantoo Underground Mine in South Australia. 

The surveys will be focusing on further defining the Kanmantoo’s Deeps target, ahead of a planned drill program. 

Kanmantoo Deeps is a coincident gravity-magnetic-conductivity anomaly that is interpreted to be due to a higher concentration of garnet, magnetite, and sulphides along the Kanmantoo shear zone. 

As previously reported, the $157 million market capitalisation company conducted a $10 million capital raising to accelerate exploration aimed at increasing both mine life and annual copper production. 

Managing Director Lachlan Wallace says the company is still focused on ramping up underground production. 

“Over the course of the next quarter, we will focus on increasing the mining rate towards steady state, as the underground development matures and multiple stopes are mined concurrently,” Wallace says.

“Following the successful capital raise, resources have been mobilied to undertake downhole geophysical surveys at Kanmantoo Deeps to assist in drill targeting. Kanmantoo Deeps is a very exciting prospect that appears to be the northern continuation of the Kanmantoo mineral system that has been offset down plunge by a fault.”

Wallace notes that the exploration target is now 60 million to 100 million tonnes with a grade range of 0.9% to 1.2% copper, which is considered an order of magnitude above Hillgrove’s existing mining inventory. 

Following commissioning the first copper production of 239 tonnes in February at Kanmantoo, production continued to ramp up to 589 tonnes in March. 

Hillgrove says this will continue to increase over the next two quarters as operations ramp up to a steady state. 

The regional area comprises 5,652km2 of exploration licences in the southeast of South Australia, within the Kanmantoo province.

As of 31 March 2024, the company had $7.43 million in cash and cash equivalents at hand, according to its latest quarterly report. 

Write to Aaliyah Rogan at Mining.com.au   

Images: Hillgrove Resources
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Written By Aaliyah Rogan
Relocated from the East Coast in New Zealand to Queensland Australia, Aaliyah is a fervent journalist who has a passion for storytelling. When Aaliyah isn’t writing stories, she is either spending time with friends and family or down at the beach.