Key Highlights:
• Heavy Minerals (ASX:HVY) progressed permitting and community engagement at Kanmantoo.
• The company received plant designs for 50ktpa and 100ktpa processing Options.
• A maiden Exploration Target defined significant garnet potential at Kanmantoo.
• Funding discussions continued for project construction and development.
• The Port Gregory Pre-Feasibility Study is nearing completion.

Heavy Minerals (ASX:HVY) provided an operational update as it advances its Kanmantoo garnet project in South Australia, with a focus on permitting, engineering design, and resource definition. The company is positioning the project toward a final Investment decision, supported by parallel progress across regulatory, technical, and financial workstreams.

The update reflects a structured development approach as the company transitions from planning toward execution.

Permitting and Community Engagement Progress

During the quarter, Heavy Minerals finalised the permitting structure for initial production at Kanmantoo, alongside identifying additional requirements for potential future expansion. Engagement with regulatory authorities and Stakeholders formed a central part of this process, with discussions helping to clarify the pathway toward approvals.

Community engagement also continued, with the company participating in consultative meetings alongside project partners. These interactions are aimed at supporting regulatory progress and maintaining alignment with local Stakeholders as the project advances.

Plant Design Options Under Evaluation

Heavy Minerals received detailed plant designs and pricing for garnet processing facilities, including a 50,000 tonne per annum option and a scalable 100,000 tonne per annum configuration.

The availability of modular plant configurations provides flexibility in project development, allowing the company to align production capacity with market conditions and funding outcomes. The final selection between these Options is expected to be determined at the final Investment decision stage.

Engineering input from specialised consultants is being integrated into the broader project framework, supporting technical planning and cost estimation.

Exploration Target Defines Garnet Potential

The company announced a maiden Exploration Target for garnet at the Kanmantoo project, covering both tailings storage and fresh tailings streams. This target outlines a range of potential tonnage and grade, reflecting the scale of mineralisation that may be accessible through tailings retreatment.

The Exploration Target is based on existing resource data, drilling results, and mineralogical analysis, providing an initial framework for evaluating the project’s potential. However, it remains conceptual in nature, with further work required to define a formal Mineral Resource.

The presence of both historical tailings and ongoing processing streams offers a dual pathway for resource access, supporting the project’s development strategy.

Funding and Development Pathway

Heavy Minerals continued discussions with multiple counterparties regarding project funding, including potential Debt, Royalty, and offtake-linked financing structures.

These discussions remain at a preliminary stage, with the company indicating that updates will be provided as material progress is achieved. Funding is a key component of the development pathway, particularly as the project approaches a final Investment decision.

In parallel, the company is progressing development work at its Port Gregory project, where the Pre-Feasibility Study is nearing completion.

About the Company

Heavy Minerals (ASX:HVY) is a resource development company focused on garnet projects in Australia, including the Kanmantoo and Port Gregory Assets.

Industry Trends and Market Context

The garnet market is linked to industrial applications such as waterjet cutting and abrasive blasting, with Demand influenced by Manufacturing activity and infrastructure development. Supply dynamics are shaped by both primary Mining and secondary sources such as tailings retreatment.

Projects that combine resource scale with flexible processing Options may be positioned to respond to changing market conditions.

Investment Risks and Challenges

The Kanmantoo Exploration Target remains conceptual, with further work required to confirm a Mineral Resource. Project development also depends on securing funding, completing permitting, and finalising engineering studies.

Operational risks include processing efficiency, recovery rates, and market Demand for garnet products. External factors such as Commodity pricing and industrial activity may also influence project Economics.

Bullish vs Bearish Perspectives

From a bullish perspective, progress across permitting, plant design, and exploration may support advancement toward production. The dual project exposure and scalable development Options provide flexibility in execution.

From a bearish standpoint, the project remains in a pre-development phase, with funding and technical validation still required. The conceptual nature of the Exploration Target and reliance on future approvals introduce uncertainty.