Stonegate Capital Partners has updated coverage on Heliostar Metals Ltd (TSXV: HSTR), highlighting the company's continued advancement of its flagship Ana Paula project in Guerrero as a high-grade underground development asset. The project recently received a positive preliminary economic assessment in early fourth quarter 2025, outlining substantial production potential and strong financial metrics that demonstrate the project's viability in current gold market conditions.
The Ana Paula PEA outlines total recovered production of approximately 875,000 ounces over a nine-year mine life, with mill feed averaging 5.37 grams per tonne gold. The proposed 1,800 tonne per day underground operation would produce roughly 101,000 ounces annually at cash costs of approximately US$923 per ounce and all-in sustaining costs of approximately US$1,011 per ounce. At US$2,400 per ounce gold price assumptions, the PEA delivers a post-tax NPV5 of US$426 million, a 28% internal rate of return, and a 2.9-year payback period, showing strong leverage to higher gold prices.
Management is currently progressing engineering work, metallurgical studies, and a 15,000-meter drill program designed to upgrade inferred resources, extend the high-grade and parallel panels, and support a feasibility study targeted for mid-2026. First underground production remains on track for 2028, maintaining the company's development timeline despite ongoing market challenges.
Heliostar's producing assets at La Colorada and San Agustin continue to serve as the cash-flowing core of the company's portfolio, providing low-capital expenditure ounces to support corporate overhead and early-works spending at Ana Paula. Both mines, acquired in the November 2024 Florida Canyon transaction, continue to optimize recoveries from existing leach pads and stockpiles while advancing mine planning for higher-grade phases. These operations, combined with potential future project financing, are expected to contribute significantly to funding the planned approximately US$300 million initial capital expenditure at Ana Paula and the approximately US$15 million decline extension and underground early-works program scheduled for 2026.
Beyond Ana Paula, Heliostar's growth pipeline includes the Cerro del Gallo project in Guanajuato, which continues through metallurgical and engineering work ahead of a planned pre-feasibility study in fourth quarter 2025. The San Antonio project in Baja California Sur remains under strategic review following its January 2025 PEA, while the Unga project in Alaska is expected to see follow-up drilling as part of the medium-term exploration program.
Management maintains 2025 guidance of 31-41 thousand gold equivalent ounces at cash costs of US$1,800-1,900 per ounce and all-in sustaining costs of US$1,950-2,100 per ounce. Production is expected to rise significantly to 150,000 ounces by 2028 and 300-500 thousand ounces by 2030, representing substantial growth from current levels. Near-term priorities include completing the 15,000-meter drill program, filing an underground permit amendment in first quarter 2026, and advancing decline extension and early works to support a potential construction decision in first half 2027.
Stonegate Capital Partners' valuation analysis applies an enterprise value to net asset value range of 0.4x to 0.7x with a midpoint of 0.6x, resulting in a valuation of $2.71 to $4.57 with a midpoint of $3.64. When using an enterprise value to reserves valuation method, they apply a multiple range of 50.0x to 80.0x with a midpoint of 65.0x, resulting in a valuation of $2.36 to $3.64 with a midpoint of $3.00. More information about Stonegate Capital Partners is available at https://www.stonegateinc.com.
