Thank you for joining today's teleconference for the release of MGX Resources December Quarter Activities Report. MGX Chief Executive Officer Peter Kerr will be leading the discussion and is joined by Chief Financial Officer Gill Dobson and External Relations Manager John Phaceas. Mr. Kerr will provide a brief overview after which there will be an opportunity to ask questions. Due to time constraints, only institutional participants will be invited to ask questions at that time. A recording of the call will also be available via the MGX website shortly after completion of today's teleconference. Thank you, and go ahead, Peter.
Thanks, Lisa. Good morning, everyone, and thanks for joining us to discuss MGX's quarterly activities report. As usual, I'll give a brief overview before any questions. And a usual reminder, all currency we mention on this call is denominated in Australian dollars unless otherwise stated. So, as you're aware, our plans for the 2025/2026 financial year were interrupted in October by the substantial rockfall we experienced on the eastern footwall of the Koolan Island main pit, and safety concerns subsequently led us to suspend mining and withdraw production guidance, and really to focus on achieving cash flows in other ways. We promptly adjusted the operations to focus on monetizing stockpile lower-grade material, and the financial performance for the December quarter actually beat our original expectations. Processing and shipping of low-grade stockpile material is now expected to continue to late in the June 2026 quarter.
Separate to Koolan Island, we're nearing completion of the exciting Central Tanami Gold Project acquisition, and that will underpin an exciting diversification into the precious metal sector for us, and I'll talk about that acquisition in a bit more detail shortly, and at the November AGM, shareholders have supported our move and approved a change of name to MGX Resources, which took effect before Christmas, so onto the quarter in a bit more detail. Firstly, in relation to safety, we had two reportable injuries during the quarter, and one involved medical treatment and the other resulted in this restricted work outcome. The company's total recordable injury frequency rate consequently lifted a little from 4.8 to 5.3 injuries per one million man-hours worked, but importantly, we still have not incurred a lost-time injury for a long period, and our frequency rate remained at zero on that measure.
Our safety performance remains favorable when compared with applicable industry standards. However, obviously, any injury is unwelcome, and significant focus continues to be applied by all at Koolan Island and in our Perth business to regain our longstanding trend of continuous improvement. In relation to the Koolan Island operations, while the quarter started positively, mining was necessarily suspended, as I mentioned, in mid-October following the footwall rockfall. Importantly, advance warning was provided by the site's radar monitoring systems and geotechnical personnel, and no injuries were incurred. So we were very fortunate and very pleased to have all those systems in place. Following subsequent geotechnical assessment, we determined that the potential for future instability posed too great a safety risk to immediately resume mining activities within the pit, and mining operations were suspended.
While monitoring has continued through the current wet season, and that's still in process now, to further assess the ground conditions, and I note that we did experience further ground instability in November in that area, the primary focus of our activity switched to the sale of available high-grade iron ore stocks that we had at the time, and then subsequently the processing and shipment of stockpile low-grade material that we had previously retained for slow blending purposes. This also necessitated substantial workforce reductions, and unfortunately, this resulted in approximately 140 employee redundancies and the loss of 130 contractor roles. Consequently, sales in the quarter totaled 0.8 million wet metric tons, and that comprised four shipments of high-grade material averaging 62.6% Fe and six shipments of lower-grade material averaging just under 50% Fe.
Shipments for the half-year totaled 1.35 million tons, and that was 870,000 tons of high-grade material at 63.7% Fe and just under 500,000 tons of low-grade material, as I mentioned, which was all in the quarter at just under 50% Fe. Given the success of the low-grade program to date, we're targeting to process and ship a further approximate 1 million tons of low-grade stockpile material, and it is lower grade. That's in the 42%-45% Fe range, and we're planning to do this in the June 2026 half-year period. Although they're sensitive to pricing, these low-grade sales are anticipated to substantially reduce the previously estimated net cost of AUD 30 million -AUD 40 million that we had for the site's post-rockfall activities in fiscal 2026, although any reduction to that estimate will obviously depend on the pricing and volume of material that's ultimately sold.
This net cost estimate also includes progressive rehabilitation activities, which we have accelerated in the quarter, and that's using available equipment and personnel, which is the most cost-effective way for us to do this. Given the benign characteristics of iron ore mining and processing at Koolan Island, i.e., there are no tailings there, it's basically mining and then resizing of rock material, the rehabilitation earthworks are progressing rapidly, and completion of those earthworks is targeted for later in the current June half. In relation to insurance, as we indicated at the AGM in November, preliminary discussions are also underway with insurance providers with respect to a potential claim relating to the rockfall incident, and we'll provide more updates on that as and when we can.
In relation to realized pricing, and that obviously improved in the quarter as far as the high-grade material is concerned, the index for 62% fines material averaged $106 a ton, and that was up from $102 per ton in the prior quarter. For high-grade material, and this is for the ships we sold early in the quarter, the 65% index improved slightly to $118 per ton in the quarter, and the Australian dollar remained reasonably steady to average $0.656. Shipping freight rates from Koolan Island to China were reasonably stable, but they did lift by around $1 per ton and averaged $13 per ton.
The four shipments of high-grade fines that we sold, and they averaged 62.6% Fe during the period, they realized average price of $85 per ton as FOB, so after shipping freight, and the six shipments of low-grade material, which averaged 49.6% Fe, realized an average price of around $42 a ton FOB. Pleasingly, in the circumstances, the Koolan Island operation generated positive operating cash flow of AUD 15 million for the quarter, and I think that was a very good result for the team on site and the people in Perth who work hard on this operation. And that comprised sales revenue of AUD 71 million FOB, less cash operating costs of AUD 45 million, and within that 45, there was also AUD 5 million of redundancy, rehabilitation work totaling AUD 4 million, and WA government and third-party mineral royalties of AUD 7 million.
Reduced mining volumes helped lower the unit cash operating cost, as you'd expect, and they were down significantly from the prior quarter to AUD 57 per ton that we sold FOB, so that's at the Koolan port, equivalent to $37 per ton FOB. And that meant for the half-year, our average unit cost for the tons that we sold was around AUD 79 per ton FOB. At a group level, free cash flow was the same as Koolan, so AUD 15 million, and that comprised the Koolan operating cash flow that I just mentioned, interest and other income of AUD 4 million, and that slightly more than covered all of our corporate admin and exploration costs.
So after some working capital movements and an AUD 12 million increase in the value of the company's equity investment portfolio, total cash and investments increased to AUD 497 million as at 31 December, and that's equivalent to approximately AUD 0.42 per share, and that compared with AUD 473 million at the end of the previous quarter, and the company has no bank borrowings. So turning now to our AUD 50 million acquisition of a 50% interest in the Central Tanami Gold project from Northern Star, there were two key steps that we achieved in the quarter. Firstly, the joint venture itself, that's the Central Tanami Project joint venture, updated its mineral resource estimate, and it was done to incorporate new drilling and align previously reported historical estimates with current JORC requirements.
The total resource estimate was lifted to 31 million tons at an average grade of 2.8 grams per ton gold for 2.8 million ounces of contained gold. That's a very good outcome. It makes the project one of the highest-grade undeveloped gold projects in the country, so obviously very exciting for us. Within the resource, the main Groundrush deposit comprises 11 million tons at 3.3 grams per ton gold for 1.2 million ounces, and that will be the core of the overall project going forward. The new estimates are all based on an assumed gold price of AUD 3,500 per ounce, and that's obviously well below the current spot price, which is circa double that at around AUD 7,000 an ounce. The joint venture has also since reported further positive drilling results, especially at the Jims deposit, and that bodes well for future updates.
And then secondly, in relation to the Tanami project, in December we received Foreign Investment Review Board approval for the acquisition, and that followed on from the joint venture partner's waiver of its preemptive right, and this is Tanami Gold NL, back in August. In relation to the remaining conditions requiring, and the main one is a further extension by the traditional owners of infrastructure arrangements on one particular tenement, we're encouraged by the relationships we've already started to build with the CLC, the Central Land Council, in the Northern Territory, and we expect to complete the transaction well before the contractual due date, which is 31 March this year.
Once the acquisition settles, we intend to work closely with Tanami Gold to push toward a development decision as quickly as possible, and that will obviously entail quite a bit of news flow as we go through the next 6-12 months on that project. In relation to the company's other investments, positive commodity prices help boost the portfolio value to AUD 42 million at quarter end, of which roughly half related to the approximate 5% interest in Queensland copper producer AIC Mines, and a further AUD 5 million related to the 5% interest we have in Queensland-based metals developer Maronan Metals. This is all in addition to Mount Gibson's 9.7% shareholding and option holding in Mid West iron ore producer FEX Resources, and that was valued at approximately AUD 38 million at quarter end.
In relation to our regional exploration activities, we expanded our portfolio in recent months and now hold over 1,600 sq km of tenements in the Edmund Basin in Western Australia's Gascoyne region. The region's considered highly prospective for precious and base metals and has remained largely unexplored today given its remoteness, so the next piece of work we're looking to do there is an airborne gravity survey of the tenements, and that's planned for the next couple of months, and before I wrap up, I again highlight the endorsement of shareholders we received at the AGM for our new direction, and that's evidenced by the support for our name change to MGX Resources, which you'll see on the various documents we now publish, and reflects our pivot away from iron ore to precious and base metals.
And then finally, we'll be releasing our financial results for December 2025, a half-year period on the 19th of February, and we have flagged that that will necessarily require a review and write-down of the non-current asset carrying values for Koolan Island, given what's occurred there, and therefore expect to report a non-cash accounting impairment in the order of AUD 55 million -AUD 65 million before tax. This will obviously leave us with a very clean balance sheet and a very strong one. So in summary, operationally, we remain focused on maximizing the remaining value from Koolan Island and doing the rehabilitation work responsibly in that process as we monetize the available stockpile material, while for the Central Tanami Gold Project, we expect to shortly close out that acquisition, and we're very much looking forward to commencing development activities with our JV partner Tanami Gold as soon as we can.
So with that, Lisa, I'll hand back to you for any questions there may be.
Thank you, Peter. Please press star one on your phone now to raise your hand to ask a question. Peter, we have no questions.
Okay, thanks, Lisa. I appreciate it's a busy reporting time ahead of the Australia Day holiday, so I wish everyone a very good happy Australia Day and long weekend, and if you do have any queries, please feel free to contact either John or myself, and we look forward to speaking with you soon. Thank you.