St Barbara Ltd (ASX: SBM) shares are on the move on Wednesday.
At the time of writing, the ASX gold stock is up 1% to 54 cents.
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Why is this ASX gold stock rising?
Investors have been buying the gold miner's shares today following the release of two announcements.
The first release reveals what the gold miner is targeting for FY 2026. According to the update, gold production from Simberi is expected in the range of 54,000 to 70,000 ounces with an all-in sustaining cost (AISC) of A$4,000 to A$4,400 per ounce.
This will be a 21% increase on its production in FY 2025.
However, management has warned that its production is likely to be weighted to the second half of the financial year. This is due to there being more planned shutdowns during the first half.
In addition, the arrival of Volvo A60H units, commencing from the end of the first quarter will support increased production.
Strategic review
In a separate announcement, the ASX gold stock provided an update on its plans for the Atlantic Gold Operations.
St Barbara has been looking at options to separate these operations from the rest of the business. However, it notes that to date, it has not received a proposal that provides shareholders with a sufficient participation in the future potential value realisation from the 15-Mile Processing Hub Project.
In addition, the permitting processes (including of environmental approvals) and government support for resource development in Nova Scotia are improving rapidly. So much so, the ASX gold stock now has the potential opportunity to apply to re-open the Touquoy mine to process low and medium grade stockpiles that remained at closure.
Interestingly, while trying to offload Atlantic Gold, the company received interest for its core Simberi operations. It notes that several parties are currently undertaking advanced due diligence enquiries and have completed site visits and management presentations.
However, it notes that there is no certainty that any current discussions will result in any firm proposals, or that any proposals will result in a binding transaction. It also highlights that any transaction will be conditional on all necessary regulatory and shareholder approvals being obtained.
For now, the ASX gold stock remains fully committed to the current Simberi Expansion Project, targeting an updated Feasibility Study in the second quarter of FY 2026. This project would significantly increase annual gold production to over 200,000 ounces with all-in sustaining costs of US$1,200 to US$1,300 per ounce. It would also extend the mine life by 13 years to 2038, based only on proven and probable ore reserves.
