Heliostar expands San Agustin upside after drilling hits beyond pit edge, pointing to longer mine life

Heliostar Metals reported new drilling results from San Agustin in Mexico, with gold intercepts more than 200 metres beyond the current reserve pit, supporting potential mine life expansion.

Heliostar Metals has reported the first results from its 2026 drilling campaign at the 100%-owned San Agustin Mine in Durango, Mexico, with new intercepts suggesting the operation could support a longer mine life than currently planned. The company said the latest drilling returned multiple gold-equivalent intervals outside the current reserve pit and has prompted an expansion of the ongoing program.

Among the headline results, Heliostar reported strong near-surface hits in the Corner Expansion Zone, including 35.1 metres grading 0.40 g/t AuEq from 1.5 metres, 19.8 metres grading 0.60 g/t AuEq from 1.5 metres, 54.9 metres grading 0.23 g/t AuEq from surface, and 30.5 metres grading 0.64 g/t AuEq from 48.7 metres. Additional results came from the Phase 3 SW Zone and MKT Zone, where the company also intersected broad mineralized intervals near the existing pit.

Drilling extends mineralization more than 200 metres from the reserve edge

The most significant takeaway from the update is that drilling in the Corner Expansion Zone has defined a mineralized corridor extending more than 200 metres southwest of the current reserve boundary, and the system remains open for further expansion. Heliostar said these intercepts are comparable in grade to material already included in the mine plan, which is important because the current operation benefits from a low strip ratio of 0.9:1 that supports strong cash flow.

The company said the results point to the potential for resource expansion and mine life extension at San Agustin. It is now planning additional definition drilling to support a resource model and evaluate a possible pit layback beyond the reserve currently being mined. That work will include both reverse circulation and core drilling, with the latter aimed at collecting rock strength, hydrogeological and metallurgical data for engineering studies.

Program expanded to 15,000–18,000 metres

Following the encouraging results, Heliostar has added a second drill rig and increased its 2026 drilling campaign from 10,000–15,000 metres to 15,000–18,000 metres. The company said the larger program is focused primarily on identifying additional oxide ounces near the mine to support a longer operating life.

So far, Heliostar has completed 75 holes for 7,230 metres in the current campaign. The latest release covers 53 holes totaling 5,148 metres across three target areas: Corner Expansion, Phase 3 SW and MKT. The company added that the next batch of San Agustin drill results is expected in Q2 2026.

San Agustin seen as a cash-flow engine for broader growth plans

CEO Charles Funk said the new drilling results build on a series of milestones at San Agustin, including the granting of expansion permits in July 2025, the restart of mining in December 2025, and the first gold produced and sold in January 2026. He added that additional production from the mine could generate meaningful cash flow in the current metals price environment.

According to the company, that cash flow could help support its broader strategy of advancing Ana Paula in 2027–28 without the need for equity financing. This gives the San Agustin expansion added strategic importance, as the mine could play a central role in funding Heliostar’s next stage of growth.

Multiple target zones still to be tested

Heliostar said the expanded drilling program will not only follow up on the current results, but also test additional oxide target areas including Phase 3, Phase 5, MKT-2, La Isla and Phase 7. At the same time, the company noted that the two-rig program will test both of its main target concepts at San Agustin: near-mine oxide opportunities and underlying sulphide potential.

That leaves room for further upside beyond the current mine-life extension thesis. For now, however, the latest drilling has strengthened the case that San Agustin may host additional mineable ounces close to existing infrastructure, a factor that could improve project economics and extend production timelines.