Highlights

• Tallebung entered the environmental impact statement phase after its scoping report was approved in the June 2026 quarter.

• Bulk ore sorting lifted Tallebung tin grades from 0.17% to 2.32% Sn while rejecting more than 93% of mass.

• Sky Metals closed FY2026 with $3.59 million in cash and $14.0 million in term deposits after two placements.

• Doradilla carries an exploration target of 10 to 15 million tonnes grading 0.32% to 0.42% tin.

A tin project in central-west New South Wales has moved from concept towards the approvals stage, and Sky Metals Limited (ASX:SKY) is the company steering it. Tallebung, a 100%-owned tin-tungsten-silver deposit, entered the environmental impact statement phase of the state significant development process after its scoping report was approved and environmental assessment requirements were issued in the June 2026 quarter. Shares were trading at A$0.180 on 23 October 2026, up 12.50%.

Permitting Meets a Bigger Resource

The permitting step sits alongside a much larger drilling base. By the end of the year to 30 June 2026, more than 500 holes had been drilled at Tallebung, compared with 115 holes behind the previous Mineral Resource Estimate. An updated estimate followed on 13 July 2026, and a pre-feasibility study was released on 10 August 2026. The company describes the project as technically and economically viable, though its annual report gives no study metrics.

Drill results from the program include 5 metres at 1.63% tin from 6 metres in hole TBRC253 and 23 metres at 1.14% tin and 0.03% tungsten from 19 metres in hole TBRC395.

Ore Sorting Changes the Grade Story

Metallurgical work has become a central part of the Tallebung case. Stage 1 bulk ore sorting tests lifted tin from 0.17% to 2.32%, a 13-fold upgrade, with recovery above 94.8% while more than 93% of the mass was rejected. Stage 2 testwork reached 10.8% tin.

At Doradilla, the company's tin project in the same state, testwork indicated roughly 78% tin recovery into a concentrate grading about 45% to 55% tin. Sky Metals has defined an initial exploration target of 10 to 15 million tonnes at 0.32% to 0.42% tin over 2.5 kilometres of a 10-kilometre corridor, equal to 32,000 to 63,000 tonnes of contained tin. The company calls Doradilla a potential second major tin development asset.

Balance Sheet and Funding Path

Sky Metals has no operating revenue. It reported a net loss of $5,369,867 for FY2026, compared with $3,150,526 a year earlier, including a $1,660,345 exploration write-down. Operating cash outflow was $2.04 million, while investing outflow reached $21.97 million, of which $8.68 million went on exploration.

Two placements funded the work: $6.1 million at $0.065 per share in July 2025 and $20.5 million at $0.155 per share in February 2026, both directed at Tallebung. Share issues raised $26.64 million, less $1.38 million in costs. At 30 June 2026 the company held $3.59 million in cash and $14.0 million in term deposits, and net assets rose to $42.08 million from $20.46 million. The company says further funding will be needed for studies, permitting and exploration.

Housekeeping has continued. In May 2026 Sky Metals signed a binding agreement to sell its non-core Iron Duke copper-gold project for up to $1.1 million, subject to conditions and milestone-linked payments. On 4 September 2026 the company was added to the All Ordinaries Index.

Priorities for FY2027

Management has set four priorities for the coming year: advancing Tallebung through development, environmental and permitting activities; continuing metallurgical optimisation, concentrate production and development studies to support future production decisions; running targeted drilling for resource growth and conversion; and progressing metallurgical, geological and exploration programs at Doradilla. No dates for completing the environmental impact statement have been confirmed.