Hillgrove Resources (ASX:HGO,OTC Pink:HLGVF) said on Monday (March 17) that it is accelerating development of the Nugent deposit at its Kanmantoo copper mine after raising AU$16 million.

The company secured AU$13 million through a placement to institutional and sophisticated investors, and raised AU$3 million via a share purchase plan that was open to existing shareholders.

"Following the success of the recent excellent Nugent drilling results, our technical team have identified a path to accelerate the Nugent production profile,” said CEO and Managing Director Bob Fulker in a March 5 release.

Fulker was referring to results from a recent drilling program at the South Australia-based operation, including 18.55 metres at 5.69 percent copper and 1.02 grams per tonne gold — significantly higher than the resource grade.

“This acceleration will allow the Kanmantoo underground mine to increase production up to 1.8Mtpa, with increased production of copper units and a material consequential decrease in our unit costs," he added.

The company said the target expansion for the mining and processing rate is approximately 25 percent, noting that it expects to see changes within the first six months of 2026.

Hillgrove also said it has entered into relevant key contracts to start work on the decline to access ore.

Its existing contractor, PJL, will supply and maintain the requisite mining equipment, while construction engineering company Redpath will provide labour for the project. Both contractors are scheduled to start work in April.

Located approximately 55 kilometres from Adelaide, Kanmantoo operated as a series of open pits from 2010 to 2020. Hillgrove began underground mining at the site in May 2023, declaring commercial production in July 2024.

The project has three production areas: Kavanagh, Spitfire and Nugent. The first two are currently in operation.

“Having three active mining areas will increase the efficiency and flexibility of underground mining operations at Kanmantoo as well as providing a more diversified base of feed to our plant,” Fulker added.

Hillgrove successfully restarted the 3.6 million tonne per year processing plant at the site in 2018.

First ore processing from Nugent is anticipated in the fourth quarter of 2025, while ore from the deposit is expected to be delivered to the plant in the first half of 2026. It plans to complete 60,000 metres of drilling at the site this year.

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Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.