Full Breakdown
Forrestania Resources Secures Second 2-Million-Tonne Gold Ore Deal in Western Australia
By Drooid · · How we work
Core Deal Overview
On September 14, 2026 Forrestania Resources signed a second ore purchase agreement with MEGA Resources that gives the company the right to acquire and process up to two million tonnes of ore over the next 24 months. The material will be sourced from MEGA’s Taipan open-pit stockpiles and can be processed at either the Lake Johnston or Edna May facilities, providing operational flexibility. The commercial formula is anchored to a baseline price of $155 per tonne for ore grading 1.43 g/t gold, with an assumed 91 % processing recovery. Ownership of the ore transfers to Forrestania on delivery, and the company retains all gold recovered.
Strategic Context
The agreement reinforces Forrestania’s “processing hub” strategy, which aims to build a regional gold-processing business around its Lake Johnston (3.2 Mtpa) and Edna May (2.8 Mtpa) plants. A similar two-million-tonne deal with First Au’s Gimlet project was secured earlier, creating a dual-supply network across the Southern Cross-Kalgoorlie district. Together, the contracts are intended to cement Forrestania’s foothold in Western Australia and transition the firm from explorer to producer.
Operational and Financial Details
- Global resource estimate: 58.6 Mt at 1.1 g/t gold, equivalent to roughly 2.08 million ounces.
- Lake Johnston mill refurbishment is slated for completion by year-end.
- Replacement mill liners for the Edna May plant are scheduled for delivery in November.
- Recent supply-chain moves include a five-year sodium cyanide agreement with Orica, a haulage contract with Campbell Gold Haulage, and a laboratory-services framework with SGS Australia.
- Forrestania appointed Tom Plant as chief financial officer in January; Plant brings three decades of mining-finance experience, including a prior CFO role at Australian Vanadium and involvement in a $230 million merger.
Official Statements
Executive chairman David Geraghty said the ore purchase and master services agreements provide a commercial framework to source third-party ore while delivering flexibility and optionality for the Lake Johnston and Edna May hubs. He emphasized that the deals advance Forrestania’s “restart readiness” and regional consolidation objectives. The company’s announcement highlighted the strategic importance of aligning supply contracts with the planned refurbishment and equipment upgrades.
Upcoming Milestones
- Completion of Lake Johnston mill refurbishment by the end of 2026.
- Arrival of Edna May mill liners in November 2026, supporting the plant’s target restart in 2027.
- Ongoing execution of long-lead procurement and service contracts to sustain the two-hub processing model.