The latest drilling homed in on Blacklode’s western flank, where the shear connects with the Syndicate and Midas Gully splays – a zone barely touched by modern exploration.
The one-kilometre-long structure links up with the north-west trending shears that host the Syndicate and Coxes reefs, creating a geological hotspot where thick, high-grade shoots plunge more than 700 metres deep and remain wide open for growth.
Larvotto says it plans to incorporate the latest results into an upcoming resource and reserve upgrade for Hillgrove, where drilling is now running full throttle.
Four diamond rigs are churning out the metres across the district, with two at Metz and two at the Freehold prospect as part of a broad campaign aimed at expanding near-mine resources and uncovering new lodes at depth.
USAC’s $720 million offer looks like a sharp opening move, however, the numbers suggest Larvotto may be holding the stronger hand. The bid appears to neatly reflect the company’s $26 million cash balance and the May definitive study, which pegged Hillgrove’s value at $694 million using conservative assumptions of US$2850 gold and US$41,000 antimony.
Even back then, however, Larvotto hinted that the real picture was far brighter. At May’s spot prices – A$5100 per ounce gold and $45,000 per tonne antimony – the project’s net present value shot up to $1.269 billion, supported by forecast annual EBITDA of $354 million and free annual cashflows of $198 million. Those are serious numbers for a mid-tier miner in waiting.
Fast forward a few months and the market tailwinds have only strengthened. Gold has since rocketed another $1600 to above A$6700 per ounce, propelling Hillgrove’s potential economics into uncharted territory. Add in the strong likelihood of a resource upgrade next year, which could stretch the current 8 year mine life well beyond the current forecast and Larvotto’s deck starts to look stacked. And a revised mine life should theoretically lead to an improved net present value – the key figure when valuing any project.
With soaring commodity prices, a resource expansion on the horizon and a potentially revalued mine life and NPV, the clock is ticking on USAC’s offer.
Continuous drilling through 2026 is set to keep Larvotto’s news flow humming, with each batch of assays feeding fresh fuel into its growth story outside of existing resources. The company says its dual focus on near-term resource gains and district-scale discovery could breathe new life into Hillgrove as one of Australia’s only producing antimony hubs.
If the latest batch of assays is any guide, the Blacklode zone could soon emerge as the next big chapter in Hillgrove’s 150-year mining story and just might prove to be something of a thorn in the side of suitor USAC.
Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au
