Red Hill Minerals (ASX:RHI) outlined its strategy as a dividend-paying, diversified royalty and exploration company operating across Australia, emphasizing ongoing cash flow from its royalty on the Onslow Iron Ore Project and a continued focus on expanding its royalty portfolio while funding exploration.
Financial position and shareholder returns
Management said the company is entering 2026 with a cash balance of AUD 61 million and no debt as of the end of December. The company’s market capitalization was cited as AUD 320 million, and the presentation noted a “strong and supportive shareholder base,” with the Board and Management holding 43% of the company’s shares.
Royalties: Onslow in production, new royalties added
Red Hill’s royalty portfolio is anchored by its Onslow Iron Ore royalty, which it said covers a total mineral resource of 1.1 billion tons. The company noted that since the Onslow Iron Project commenced production it has received more than AUD 27 million in royalty payments.
For the current financial year, management said that at a production rate of 35 million tons per annum, and at current iron ore prices and exchange rates, it expects approximately AUD 28 million in royalty payments. It added that it has received almost AUD 15 million over the past two quarters.
In addition to Onslow, the company referenced the Pannawonica Iron Project in northern Western Australia, stating it has a resource of 63 million tons and a mining reserve of 4.7 million tons at a grade of 56% iron. Management said several environmental studies were recently finalized “to a standard suitable” for supporting mining proposals and development approvals.
As part of a broader strategy to expand and diversify royalty income, the company said it purchased two new royalties last year:
- Sandstone Gold Royalty: Red Hill holds a 2% gross revenue royalty covering a portion of Brightstar’s Sandstone hub. Management said the royalty ground contains “just over 1 million ounces of gold.” The company said Brightstar is drilling 100,000 meters across the broader hub, with much of that drilling occurring on the royalty tenements. An updated mineral resource is expected in the June quarter, followed by a PFS and mining reserve expected in the September quarter. Brightstar is expected to seek an investment decision after completing a DFS next year, according to the presentation.
- Thomson Copper-Gold Royalty: Red Hill acquired a 1.5% net smelter royalty on Legacy Minerals’ early-stage Thomson Copper-Gold Project in far western New South Wales. Management said Rio Tinto Exploration has entered into an option agreement with Legacy that includes significant exploration funding of up to AUD 25 million.
Management summarized the royalty set as three assets at different stages: Onslow (in production), Brightstar’s Sandstone royalty (nearer-term), and Thomson (longer-term).
Exploration and joint venture activity: Broken Hill and Anabama
Red Hill also detailed its exploration program, including the Curnamona Earn-In Joint Venture with Peel Mining. Under the agreement, Red Hill has the right to earn 75% by spending AUD 6.5 million within five years across an earn-in area of 1,700 square kilometers. The earn-in area includes the Broken Hill Project in New South Wales, described as having “tier one potential” for lead-zinc-silver deposits under cover, and the Anabama Project in South Australia, which is prospective for shear-hosted copper-gold mineralization.
At Broken Hill, management said the team conducted a review of historic exploration data and acquired new geophysical datasets, which supported target generation and led to four priority targets being drilled late last year. The company completed just over 3,700 meters of diamond drilling across targets including Dementus, Woolley, and Immortan (Broken Hill-type mineralization) and K1 (copper-gold). The best result cited was at Dementus, where a 958-meter hole intercepted 91 meters at 0.1% lead and 0.3 g/t silver from 328 meters. While described as lower grade, management said key Broken Hill-type textural features were encountered, and it characterized follow-up drilling at Dementus as a high priority.
To support that work, Red Hill said high-resolution gravity and AMT (ground magnetotelluric) surveys are commencing next week, with drilling planned in the second half of the year.
At Anabama, the company is targeting shear-hosted copper-gold mineralization along a shear zone. Prior to drilling, it completed a 20 line-kilometer IP survey, and management said the IP anomalies correlated well with known mineralization and helped extend the prospective corridor to 6 kilometers of strike length. The maiden drill program consisted of two diamond holes totaling 946 meters. Assays from the first hole confirmed hydrothermal copper, gold, and silver mineralization associated with the shear zone, including an interval highlighted as 6.5 g/t gold, 2.3% copper, and 10.3 g/t silver over 44 centimeters in hydrothermal breccia. Management said the early results support an interpretation of continuous mineralization at depth and noted the hole tested at least 100 meters deeper than surrounding holes. Results from the second hole are expected shortly, which the company said will guide follow-up work later this year.
West Pilbara: Barkley gold drilling set for April
In the West Pilbara, Red Hill described the region as prospective not only for iron ore but also for gold and base metals, with gold mineralization linked to regional faults. The company said most of its drilling has focused on the Barkley gold target, adjacent to one of these faults, and that it has “consistently” intersected gold mineralization over approximately 1 kilometer of strike. Management said Barkley remains early stage and open in most directions, and outlined plans to continue step-out drilling.
The company said it plans 11 holes totaling about 3,000 meters at Barkley, with heritage surveys completed and approvals in place. A rig is booked for April. Red Hill also said it is progressing other greenfields targets in the Pilbara with the aim of generating drill targets and potentially drilling later in the year.
Outlook: royalty income and active business development
Looking ahead, Red Hill said it is anticipating royalty income of approximately AUD 28.7 million, noting that nearly AUD 15 million has been received over the past two quarters. The company reiterated it will continue a substantial, systematic exploration program conducted on a campaign basis for flexibility, while also pursuing business development initiatives—specifically assessing opportunities to purchase and/or create new royalties on exploration projects.
Management closed by characterizing Red Hill as well-funded, dividend-paying, and supported by long-life royalties, with a “busy year ahead” across its royalty and exploration portfolio.
About Red Hill Minerals (ASX:RHI)
Red Hill Minerals Limited engages in the exploration of gold and base metals in Western Australia. It also explores for battery metals and aggregates. The company holds 100% interest in the Red Hill Minerals West Pilbara project covering 1,600 square kilometers, located adjacent to the western margin of the Hamersley Basin. It holds 100% interests in the Pannawonica iron ore project; and the Three Peaks Hard Rock Deposit. The company was formerly known as Red Hill Iron Limited and changed its name to Red Hill Minerals Limited in December 2022.
