Heliostar Metals (TSXV:HSTR) - Mine Cash Flow to Fund $150M of Ana Paula Build

Interview with Stephen Soock, VP Investor Relations & Development of Heliostar Metals

Our previous interview: https://www.cruxinvestor.com/posts/heliostar-metals-tsxvhstr-emerging-gold-producer-targets-300k-oz-by-2030-with-strong-cash-flow-10415

Recording date: 24th September 2026

Heliostar Metals (TSXV:HSTR, OTCQX:HSTXF) is a Mexico-focused gold producer attempting to move from roughly 50,000 ounces a year towards 300,000 ounces by the end of the decade without issuing new equity. The strategy rests on sequencing. Two producing heap leach mines, La Colorada in Sonora and San Agustin in Durango, generate cash that is being directed into the Ana Paula underground project in Guerrero. Ana Paula's cash flow is then expected to fund Cerro del Gallo in Guanajuato.

Operationally, the company produced 14,803 ounces of gold in Q2 2026 at a year-to-date AISC of $2,155 per ounce. La Colorada has moved from stockpile processing to injection leaching, which Stephen Soock, VP Investor Relations & Development, said is producing about 1,000 ounces a month. Waste stripping on the Veta Madre Plus cutback runs to around Q2 2027, followed by nine to 12 months of production from fresher ore. Soock expects about 20,000 additional ounces beyond the existing Veta Madre reserve, although a technical report has not yet been issued.

Ana Paula is the core of the investment case. The feasibility study is 34% complete and due in Q2 2027. Drilling of about 25,000 metres focused on converting inferred material, and the company is targeting 100,000 ounces a year over a 10-year mine life. Optimisations include raising throughput to 2,000 tonnes per day, sizing equipment for 2,500 tonnes per day, and a twin-decline design with an underground crusher and conveyor that could cut operating costs. Bio-oxidation remains the preferred processing route, and Soock noted it is not yet used in North America. Initial capital is expected to rise from the PEA's $300 million to around $330 million. The study gold price is likely to move from $2,400 to around $3,500 per ounce based on a three-year trailing average.

The funding plan allocates about $150 million of operating cash flow to Ana Paula construction over roughly two years, net of overheads and exploration. Project debt is intended to cover the rest. Cash is expected to hold near US$43 million through year-end, and just under $15 million is budgeted for deposits on long-lead items. A construction decision is expected around June or July 2027, with first gold targeted before the end of 2028.

Beyond Ana Paula, Cerro del Gallo offers about 85,000 ounces a year over 15 years on current study numbers, with Soock suggesting an updated PFS could show a larger staged project. Exploration is picking up at La Colorada and Ana Paula, where down-dip drilling returned 101.0 metres at 5.34 g/T gold. Goldstrike in Utah adds an antimony zone with drill results pending.

On valuation, Soock argues Helios