Minerals 260 Shares Gain 7% as Bullabulling Gold Developer Bounces Back Ahead of 2027 Investment Decision

Minerals 260 Ltd shares rose more than 7% on Monday. Investors returned to the developer of the Bullabulling gold project in Western Australia after a pullback that followed the recent slide in gold prices.

Minerals 260 shares gained 4.75 Australian cents, or 7.20%, to 70.75 cents. In the session they traded between 67.25 cents and 72 cents. About 6.9 million shares changed hands, and the company's market value was about A$1.8 billion.

The stock has risen about 136% over the past 12 months, one of the strongest gains among ASX 200 resource stocks.

Minerals 260 did not release any market-sensitive news on Monday. The gain came even though bullion stayed weak: spot gold traded near US$3,996 an ounce after dropping below US$4,000 on Friday for the first time in about three months. The S&P/ASX 200 was up 0.13% at 8,806.8 at 2:22 p.m. Sydney time.

Recovering ground

Monday's rise followed a pullback. The shares closed at 66 cents on Friday, down from 81 cents on Oct. 16, when a rally in gold to around US$4,190 an ounce lifted gold developers. They are also below the 88-cent price of the company's A$250 million placement in September.

A 6.2-million-ounce project

Minerals 260 bought Bullabulling, about 25 kilometers southwest of Coolgardie in Western Australia's Goldfields, in April 2025. Since then it has quickly expanded the project's resource and moved it toward development.

The current mineral resource is 6.2 million ounces of gold: 190 million tons at an average grade of 1.0 gram per ton. Of that, 4.4 million ounces are in the indicated category.

A pre-feasibility study released in July outlined:

A maiden ore reserve of 2.5 million ounces. A 19-year mine life producing about 150,000 ounces a year. A post-tax net present value of about A$2.3 billion. An internal rate of return of 43%. Pre-production capital estimated at A$855 million.

The company aims to bring Bullabulling into production by the end of 2028. Managing Director Luke McFadyen has said that would make Minerals 260 "the next mid-tier gold producer on the ASX."

Early works are under way. They include a 400-person accommodation village expected to open in early 2027, water infrastructure, and grade control drilling.

Drilling supports resource

Earlier this month the company reported results from its first grade control drilling at Bullabulling. The results included 6 meters at 17.1 grams per ton gold at the Phoenix deposit. They also included a narrow, high-grade intercept of 1.1 meters at 290 grams per ton at Bacchus, which the company said would need further drilling to assess.

"Results from our initial grade-control drilling strengthens our confidence in the Mineral Resource," McFadyen said.

A second round of grade control drilling is planned to support a definitive feasibility study and the conversion of resources to reserves.

Funding the build

In September, Minerals 260 raised A$250 million at 88 cents a share. The raising came in two tranches, and the second, worth about A$71.1 million, requires shareholder approval at a general meeting scheduled for late October. The company also offered a share purchase plan of up to A$30 million to existing investors.

Royalty and streaming company Franco-Nevada committed A$30 million as a cornerstone investor in the placement. It also agreed separate royalty funding of A$170 million in exchange for an additional 1.45% royalty over Bullabulling.

The company said those deals lifted its pro-forma cash to about A$633 million, with no debt. It expects to cover the rest of the capital cost with project finance and has received non-binding indicative term sheets from lenders.

McFadyen said the funding "has significantly strengthened and de-risked the Company's balance sheet."

"We are targeting to be fully funded ahead of the planned Final Investment Decision in early 2027," he said.

Risks remain

As a pre-production developer, Minerals 260 faces the usual execution risks: securing approvals, finalizing debt funding, controlling construction costs and delivering the project on time. Its share price is also highly sensitive to gold prices. Gold has retreated in recent weeks as inflation concerns, fueled partly by rising oil prices, reduced expectations of interest rate cuts.

The company joined the S&P/ASX 200 index in June. Over the next few months, investors are expected to focus on the second-tranche shareholder vote, the definitive feasibility study and progress toward a final investment decision.