East Star Resources (LSE:EST), the Kazakhstan-focused gold and copper exploration company, has mobilised a second diamond drill rig at its Verkhuba copper deposit, expanding capacity as the joint venture with Hong Kong Xinhai Mining Services clears its first major funding hurdle.
Seven holes and more than 1,350 metres have been drilled so far, with the programme aimed at resource conversion, geological modelling, mine planning and feasibility work, particularly for the initial years of mining.
Xinhai has now completed its full Stage 1 investment of A$1.5 million, securing an initial 15% stake in the joint venture company, Verkhuba, to which ownership of the Verkhuba licence has been transferred.
The process of issuing 15% of the JV to a Xinhai subsidiary has begun, and the drilling programme is fully funded by the JV at no cost to East Star.
Under the JV terms, East Star remains carried through to production, at which point it will retain a 30% interest in the producing mine.
"These milestones complete the establishment phase of the JV and allow the partners to focus entirely on advancing Verkhuba towards resource conversion, feasibility studies and ultimately production," said CEO Alex Walker.
News Intelligence what this means for the company
East Star's joint venture partner Xinhai has completed its A$1.5 million Stage 1 funding commitment, unlocking a second drill rig and clearing the path to resource conversion and feasibility work at Verkhuba. The company remains carried through to production with a 30% interest in the producing mine, while the JV funds all drilling at no cost to East Star—a material de-risking as the project moves from exploration into development-stage work.
Xinhai's completion of Stage 1 funding validates the JV structure and removes near-term capital burden from East Star, allowing it to advance Verkhuba toward resource definition and feasibility without dilution. The second rig and fully-funded drilling programme materially accelerate the path to a production decision, though resource conversion and feasibility timelines remain unspecified.
Insights assembled by AI. Editor-reviewed and grounded in tickstock’s coverage and proprietary knowledge graph.
Content is for informational purposes only, not financial advice.
