Lunnon Metals (ASX:LM8) has completed open pit mining at Lady Herial ahead of schedule, with the operation set to generate approximately $39 million in attributable pre-tax free cash flow.
The company mined 303,437 tonnes @ 1.68 grams per tonne gold (Au), resulting in 14,910 ounces sold after applying the 91% metallurgical recovery rate under its ore purchase agreement.
The ore was sold to St Ives Gold Mining, a subsidiary of Gold Fields (NYSE:GFI).
On a 100% basis, Lady Herial generated $93.26 million in revenue and $55.7 million in pre-tax free cash flow against the January 2026 Feasibility Study forecasts of $92.54 million and $57.7 million, respectively.
Lunnon’s 70% share of free cash flow reached $39 million, 3.5% below the forecast $40.4 million.
The operation sold 100.7% of forecast gold ounces despite mining 13.1% more tonnes than planned. The additional material and occasional dilution lowered the average grade by 11.1% from the forecast 1.89g/t Au.
Total operating costs reached $31.62 million, 5.1% above the $30.10 million estimate, largely because of the additional tonnes hauled and processed.
However, the all-in sustaining cost was broadly in line with the study at $2,368 per ounce, compared with the forecast $2,354 per ounce. Lunnon notes it also realised an average gold price of $6,254 per ounce against an assumed $6,250 per ounce.
The final August invoice to St Ives totals approximately $5.1 million for 1,258 ounces, against direct operating costs of approximately $1.2 million.
Following the completion of mining, Lady Herial’s ore reserve is fully depleted. The remaining mineral resource estimate totals 589,600 tonnes @ 2g/t Au for 37,000 ounces.
Lunnon reported an unaudited cash balance of $41.4 million at 31 August and is funding a $13 million drilling program for the 2027 financial year.
Lunnon Metals’ Kambalda Gold and Nickel Project covers approximately 47km² in Western Australia’s Kambalda-St Ives district. Its portfolio contains gold resources totalling 73,200 ounces and nickel resources of 113,600 tonnes.
Write to France Pinzon at Mining.com.au
Images: Lunnon Metals
