Estrella Resources (ASX: ESR) Unveils US$1.45 Billion Limestone Opportunity as Major Development Takes Shape

Estrella Resources (ASX: ESR) has taken a significant step towards unlocking the commercial potential of its Werumata Limestone Project in Timor-Leste, with a new scoping study outlining a US$1.45 billion development opportunity.

Released on 12 November 2026, the study forecasts strong operating margins, a 46% internal rate of return and a staged pathway towards 25 million tonnes of annual production.

With favourable project economics and growing industrial demand across South-East Asia, Estrella now has a clearer development strategy. The next challenge is converting that potential into a financed, commercially viable operation.

Key numbers

• US$1.45 billion: Base-case after-tax net present value at a 10% discount rate.
• 46%: Projected internal rate of return, with a 3.5-year payback period.
• 533 million tonnes: Updated Mineral Resource, comprising 274 million tonnes Indicated and 259 million tonnes Inferred.
• US$476 million: Estimated total development capital, with a US$363 million peak funding requirement.
• US$7.89 per tonne: Forecast average operating cost against an assumed US$20 per tonne selling price.

Werumata's development strategy reveals substantial earnings potential

Werumata is emerging as a potentially important limestone supply project for South-East Asia, particularly Indonesia's expanding nickel processing industry.

Limestone is used to neutralise acidic waste generated during nickel processing, creating a substantial industrial market for Werumata's higher-quality material.

Estrella's development strategy begins with an approximately eight-million-tonne-per-annum operation requiring US$117 million in initial capital expenditure.

A subsequent expansion would increase annual capacity to 25 million tonnes, with full production targeted from 2030.

Importantly, the staged approach is designed to generate early operating cash flow that could help finance further expansion, potentially reducing the amount of external capital required.

At an assumed selling price of US$20 per tonne and forecast average operating costs of US$7.89, Werumata offers an indicative operating spread of US$12.11 per tonne before royalties, taxes and other financial obligations.

These preliminary economics highlight the project's potential to generate meaningful operating cash flow once established.

Strong projected earnings support the development opportunity

The scoping study forecasts approximately US$500 million in typical annual revenue and US$306 million in EBITDA under its full-scale base case.

These projections demonstrate the potential scale of Werumata's earnings contribution, although they remain preliminary rather than established operating results.

The project requires approximately US$476 million in total development capital, with a lower peak funding requirement of US$363 million reflecting anticipated reinvestment of early operating cash flows.

Estrella reported $2.85 million in cash at 30 September 2026, compared with $5.24 million at the preceding quarter-end.

Quarterly operating cash outflow totalled $584,000, while exploration and evaluation expenditure reached $1.65 million.

The company's existing cash resources are therefore insufficient to finance Werumata's proposed development independently.

However, the staged construction strategy provides a potential pathway to funding expansion progressively, provided Estrella secures suitable initial financing and achieves its operational targets.

The next feasibility study will be particularly important in refining development costs, strengthening project economics and supporting discussions with potential financing partners.

Indonesian demand strengthens Werumata's commercial prospects

One of Werumata's most attractive characteristics is its proximity to Indonesia's substantial nickel processing industry.

The project contains approximately 391 million tonnes of higher-quality Product 1 limestone suitable for acid-neutralisation applications.

Around 70% of this material is classified as Indicated, strengthening the geological foundation for further development studies.

Estrella also has a marketing framework agreement with Indonesian group PT Raka Energi Mandiri, providing an established channel for advancing potential limestone sales.

Although binding, bankable offtake contracts have not yet been executed, the arrangement creates a platform for developing commercial relationships.

The project's economics also demonstrate some resilience under lower selling-price assumptions.

At US$15 per tonne, the base-case NPV remains positive at US$622 million, with a projected internal rate of return of 26%.

Separately, Estrella's binding agreement covering 27,000 tonnes of manganese from its Ira Miri joint venture provides another potential avenue for generating nearer-term cash receipts, subject to shipment and payment.

Insight: Could Werumata become Estrella's defining growth asset?

We see Werumata's strongest attraction in its combination of substantial limestone resources, proximity to Indonesian industrial demand and potentially attractive operating economics. The projected US$306 million annual EBITDA highlights what successful development could deliver, while the staged strategy offers a practical approach to managing capital requirements. Although financing and regulatory approvals remain critical, Estrella has established a stronger foundation for advancing the project. The next meaningful tests will be binding offtake agreements, refined feasibility estimates and progress towards securing development funding.

The verdict: A promising opportunity with significant milestones ahead

Estrella is targeting feasibility study completion and a final development decision in the fourth quarter of 2027, subject to board approval and financing.

First production is provisionally targeted for the third quarter of 2028, with expansion towards full capacity planned thereafter.

Meanwhile, exploration at its Laleno Dome copper-gold prospect provides an additional potential source of long-term value.

Werumata's preliminary economics present an encouraging development opportunity, supported by substantial resources and exposure to regional industrial demand.

The focus now shifts towards converting that potential into binding customer commitments, regulatory approvals and a credible financing package.

If Estrella delivers these milestones, Werumata could become a cornerstone asset supporting the company's next phase of growth.