East Star Resources (LSE:EST), the Kazakhstan-focused gold and copper exploration company, has signed a binding Heads of Agreement with Nova to establish a joint venture company that will farm into the Rulikha Copper Project.
Nova will fund resource definition, feasibility studies, permitting, development and commissioning, with no further cost to East Star, while Orion Development, an experienced Kazakhstan mine developer, will act as operator.
The farm-in runs through five milestones, from tenement transfer and drilling to commercial production, with East Star's final stake set at 25% under the default structure or 35% under an alternative cost-recovery arrangement that gives Nova priority claim on distributable cash flow until construction and relocation costs are repaid.
The deal is East Star's second Kazakh copper joint venture, following the Verkhuba-Xinhai Mining Joint Venture announced on 19 March.
Orion's team previously took the Karshyga copper deposit from acquisition in 2017 to a producing asset generating approximately $80 million in revenue by 2025, before selling its remaining 51% stake to a Chinese mining company.
East Star has received drilling approval for licence area 1799-EL, which hosts the primary Rulikha target, and is sourcing contractors for a drill programme in the third and fourth quarters.
"This transaction enables East Star to maintain exposure to a second, potentially transformational copper development while continuing to focus its own resources on exploration, discovery and value creation," said chief executive Alex Walker.
A November 2025 JORC-compliant exploration target put Rulikha's upper limit at 23 million tonnes grading 2.4% copper equivalent, largely within an open pit.
News Intelligence what this means for the company
East Star has secured a second major copper joint venture, with Nova funding all development costs through to production at Rulikha while East Star retains 25–35% equity depending on the structure chosen. This follows the company's March Verkhuba deal with Xinhai and mirrors its strategy of using farm-ins to advance copper assets without capital outlay; the Rulikha target carries a November 2025 exploration estimate of up to 23 million tonnes at 2.4% copper equivalent, largely amenable to open-pit mining.
- Orion Development's track record - advancing Karshyga from acquisition to ~$80 million annual revenue by 2025 before exit - signals operational credibility, reducing execution risk on the development pathway.
- The dual-JV structure (Verkhuba at 30% carried interest, Rulikha at 25–35% with Nova funding) allows East Star to maintain exploration focus while holding material upside in two copper developments, though cash-flow priority to Nova under the cost-recovery option at Rulikha could delay distributions.
East Star retains 30% in the producing mine at Verkhuba and now holds 25–35% at Rulikha, positioning it as a leveraged play on two funded copper developments without further capital commitment. The risk lies in execution by Nova and Orion, and in the timing and scale of cash returns under the cost-recovery structure at Rulikha.
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