Going to spend a lot of time talking about the growth side of things today. As we roll through this year, we've guided 90,000 to 105,000 ounces of gold. As you can see there, guidance at AUD 2,800 to AUD 3,400 Aussie or roughly USD 2,000 per ounce. We've got a strong reserve base of 900,000 ounces of gold. We expect that to continue to increase as we carry out a large exploration program. We're spending AUD 50 million this year exploring. We spent the same last year and expect to spend the same again next year. We have zero debt. We have no hedging. We have around AUD 230 million or USD 160 million in the bank. We got into this asset in 2019. We very rapidly took the reserve from zero to 1 million ounces. We drilled about 350,000 meters over the first year and a half.
By October 2020, we'd finished the feasibility study. We moved straight to constructing a new processing plant. There was an old plant here, which we demolished, and we got into production. We by no means moved in first up on the highest grade assets. We moved in and proved up what we saw as the opportunities that were the lowest time and the lowest capital to get to production. Our strategy was to get into a strong cash flow position and then move into stages 2 and 3, which is to drill up what has been historically the highest grade goldfield in Western Australia, replace the lower grade open pit ounces with high grade underground ounces, and take our production profile from that 100,000 ounces a year up to 200,000 ounces a year. We've talked a little bit about the balance sheet there already.
You can see we have just under 400 million shares on issue. We have a strongly institutionalized register. We have some really strong coverage from a majority of the Australian brokers, but you can see some of the very large houses there are covering us now as well. We put out a short update this week just before these conferences started just to let people know that everything is running well on track for this year. With that guidance of 90,000 to 105,000 ounces, it was 40% to 45% in the first half of the year, 55% to 60% in the second half of the year, and you'll see why as we go through the presentation. We're actually tracking in this first quarter at the very top end of the guidance that we gave there.
We have a new open pit that commenced in August that's already producing ore for us. Very importantly, we've made a big discovery. We think it's going to be a big discovery at Racetrack, which is just north of one of our operating mines at OK, which you'll see in a moment. You see our tenure there. Sorry. Processing plant sits in the center of it. We're producing from right down in the south end at Scotia. OK, right next to it. Gladstone to the right-hand side there. We're developing a third underground mine at Mainfield at the moment as well. As I said, we sit right at the southern end of the Norseman-Wiluna Greenstone Belt. This belt has produced pretty much all of the gold that's come out of Western Australia, with a few exceptions.
This was a large package that came out of the Western Mining stable when Western Mining decided they were exiting gold. I've got the comparison to the north there with Kambalda. Kambalda was purchased by Gold Fields out of South Africa. They went straight in. They undertook a big exploration campaign. They've added about 14 million ounces of gold there during the period that Norseman has essentially sat idle with no exploration at all until we've come back in in 2019 and picked it up. A big exploration opportunity here, as well as conversion of resources to reserves in the well-established resources that we already hold, which are sitting at about 4.7 million ounces. Our pathway to that 200,000 ounces. As I said, we're at that 100,000 at the moment.
We've optimized the mill, so we're comfortable that we can run that mill at between 1.4 and 1.5 million tons per annum now. That is contingent on having a full fresh rock feed. We currently still have a little bit of oxide coming from the pits. That will be completed early next year. Bringing additional underground mines on will see us replace that lower grade open pit feed with high grade underground feed and drive that plant up to the 200,000 ounces per annum. In terms of our operations, the first one here is the OK Underground Mine. It's relatively small. It's currently producing between 25,000 and 30,000 ounces per annum. We've been mining here since 2022 when we commenced mining. We have replaced the depletion and increased the reserve every single year that we've been operating this thing.
It has just over 120,000 ounces of reserve, roughly twice that in resource, and I fully expect that we'll continue to see the increases in those main ore bodies that we're mining now being the O2 Lode, Star of Erin, and Main Lode as we move forward in the coming years. But importantly, you can see on the top left of that diagram there, a proposed access out to a discovery that we call Racetrack that we've just made in the last sort of five months. You can see we have some quite phenomenal widths and grades developing at Racetrack. It's currently 900 meters long. It's completely open to the east. Every time we step out, we're stepping out another 200 meters. We've drilled it down to 600 meters deep.
We're seeing that continuity in the high-grade plunge very strongly through everything that we've drilled so far. I just want to demonstrate just how strong it is looking on this next slide. First of all, the diagram that you're seeing on the left-hand side now is a plan view of that oblique view of OK that you were looking at previously. The O2 Lode was what was yellow. The Star of Erin lode is what is green. The Racetrack lode is a parallel lode to the Main Lode and the Star of Erin there. These cross-linking structures weren't really recognized in the very long history of Norseman. It's been mined from 1935 right up until 2000. The only cross-linking lode that was really mined on a large scale during that period was only discovered in the early 1980s.
They mined right next to it in what we call the Main Field for the best part of 50 years before they discovered it, and they found this thing called Bullen. Bullen produced 500,000 ounces of gold at 10 grams a ton. What you see on the right-hand diagram there is what we've discovered at Racetrack with the whole Bullen mine superimposed over the top of it. You can see we've already extended the strike compared to what Bullen was. We've extended the depth, and we're continuing to extend that depth. The really exciting thing for me is that before Bullen was mined, there was 90 holes drilled in it, and of those 90 holes, the average width was 1.37 meters. The average grade was 10.3 grams a ton. It did overcall a little bit while mining.
The Racetrack deposit so far, we've drilled 43 holes, so we've drilled roughly half of what was drilled in Bullen. We're currently averaging 3.6 meters wide at 18.6 grams a ton. So we're more than twice the width, we're nearly twice the grade compared to what Bullen was. So it's shaping up very strongly to be a plus million-ounce deposit. Obviously early days, but you can see there with the proposed decline, which has been approved by the board, we're advancing this very quickly. That decline going out to Racetrack has actually commenced this week, and we expect to be drilling from that by late in the first quarter of next year. We expect to be developing the first levels here within 12 months from now. Moving on from OK now to the Scotia mine, so down to the southern end of the field.
We've been mining underground here for the last couple of years. All of the red stopes that are shown are stopes that we've mined. The blue areas are historical mining from the 1980s and 1990s. The yellow areas are what fits into our mine plan at the moment. We produced just under 40,000 ounces out of here last year. This year, we expect to do 45,000 to 50,000 ounces. The big change that you have is you can see that most of our mining's been in that central area in Scotia until now. We have now advanced all of that development down to the northern side of the mine. We have 2 full levels developed. We have a third one under development in ore. We have a fourth one that's at the crosscut. So that's in a true production position now as well.
Straight above that, you see extensions to that as historical mining. We've proved up about 500,000 tons at 4 grams there. So through this year now, we will move into having a full production capacity from 3 different areas in this mine where we've only had one up until this current time. The Green Lantern open pit now is an extension from Scotia. You can see Scotia in the background there marked with the white writing. Green Lantern Stage 1 we mined in 2022. It reconciled very well. It is lower grade than most of the things we're mining. The reason we're mining this now is that it is fresh rock from the top, as you can see.
It allows us to build a large stockpile through this year to give us a very constant fresh ore feed so that when we have rain and other events, we don't have to slow down in that processing plant. By this time next year, we expect to have over 600,000 tons in stockpiles and have that plant at the higher run rate. I should say this pit, we expect to mine it for 12 months, build that big stockpile, and give it a rest again. But operating with one pit at the sort of rate that you see there, it has about four years of life. We can switch this pit on and off as we please to fill the mill. Moving on to the Gladstone pit now, so eight kilometers east of the processing plant. We have been mining here for the last year.
We have mined stages 1 and 2, which are shown in green and yellow there. We're currently doing the cutback for stage 3, which is shown in blue. That cutback has proven up very well with our drilling. We've only drilled the pit position at the moment. We will drill for underground there as well. We now have about 50,000 ounces here at an average mined grade of 3.4 grams a ton. So nearly as good as an underground feed. Coming from Gladstone, we will put about 20,000 ounces on the ROM pad from this pit in this coming year, 30,000 in the second year. Looking at further growth now outside of the Racetrack lode. I'm showing the Main Field here of six kilometers from north to south. Over three million of the historical six million ounces of Norseman have come from this Main Field.
You can see right down the southern end there, the OK Mine with that cross-linking structure that is Star of Erin lode that I was talking about earlier. You can see halfway up the Bullen decline that is marked. The other two major reefs there, the Crown Reefs, produce 1.1 million ounces at 11 grams. The Mararoa Reef has produced 1.4 million ounces at about the same grade. This is what it looks like in plan view. Everything that's in dark blue there, we have rehabilitated or put new development in in the last 18 months. We've rehabilitated roughly eight kilometers of the existing mine. We've put about two kilometers of new development into this mine as well to allow us to drill the initial areas. You can see three areas marked in red there. We are going to development of these things this year.
We only expect to produce roughly 10,000 ounces this year out of this Main Field but expect to grow it to sort of 40,000 and 50,000 ounces and beyond. You can see this and Racetrack lode combined take us to that elevated production profile that we're chasing. I should mention on this scale, those areas that we're mining look very small, but you can see that at 300 and 350 meters of strike, they are about the same size as the OK Mine, each of them in their own right. Both of them are open, one to the north, one to the south. The one in the center there that's shown as 300 meters, we're developing an ore ramp through that at the moment. We're getting very strong results from it. We're also drilling below it.
We have seen multiple hits at plus 100 grams in there, so no doubt that it continues at depth. Just before I jump off of that slide, going out to the Crown, you can see a brown drive, which is a design drive going from that central mining area towards the Crown Reef. The Crown Reef has been a prime target for us since we started here. The bright areas that are shown that are stoping grades from the 1970s and previous to that have produced 1.1 million ounces at 11.2 grams a ton. The pillars that look like pillars that remain up in that upper area are about 300 meters by 300 meters each in size. We have done a fairly substantial amount of drilling in those from underground and from surface.
We now have, in this Bullen decline in total, we now have taken the reserve as of yesterday to 270,000 ounces. We fully expect to keep that growing going forward. The bottom half of the ore body that you see that has had very little mining on it, the development you see is from the 1970s. If you remove the stoping grades from the top half of this reef, the development grades in the second half look very much the same. We see a real opportunity in the areas that have actually had development in them before to be up to a million ounces of additional reserve. Again, all of this is completely open at depth. So a huge amount of growth drilling for us to continue on with and to really grow that reserve to 2 million and beyond.
Just showing this is an example of the drilling that we are doing under those things. So this was the area that was on the left-hand side of the diagram that I showed with the three areas that we are mining. Been very successful over 350 meters so far, enough that we are comfortable to go and put the first three levels in. That is a purpose-built decline that we put in there to undertake this drilling. This is another great example where it is completely open for another 1.5 kilometers to the south. There is almost complete mining above the level that we will be tapping for that whole 1.5 kilometers. So a huge amount of potential there. Then finally, I want to talk about the greenfields areas that have been very, very lightly touched. Western Mining Corporation started drilling these things in 1990.
They made a discovery called Harlequin right on the edge of these lake areas in early 1992. They have been drilled for about 18 months, primarily with air core, a little bit of RC. Harlequin went on to produce 800,000 ounces of gold at 10 grams a ton. It still has a few hundred thousand ounces in resource. That mine requires dewatering before we can get in there, but has produced at very high grade. These lake areas were untouched by Western Mining Corporation because they had so much opportunity elsewhere. But in that very tiny amount of work that they did, they have got multiple prospects here that have had a small amount of holes, generally six to 18 holes. A large number of them have got issues associated with native title in April this year. By June, we had this air core rig out on the lakes.
In conjunction with the air core, we have flown what is understood to be the largest ever drone-based mag survey undertaken in Australia, very close space, and you can fly very low to the ground with a terrain like this. So we have great structural definition. We are going through a stage-gated process now, which we understand to be very similar to what Gold Fields has done in those lakes where they have discovered millions of ounces, over 10 million ounces. As we go through that, we expect to see these anomalies that we know are there developing further, and we will then move in subsequent years, starting next year, with RC and diamond drilling into these areas. So a huge amount of opportunity at Norseman.
We have been fully self-sustaining for the last three years now, I think, building the cash balance of the company at the same time as undertaking these growth activities. So thank you very much for your attention.
Thanks, Paul. Any questions?
Hello, sir. I am just wondering what kind of development profile will you try to do to get. Will you have three different sites in operation or four or what exactly?
Yeah, I expect that to get to that 200,000 ounces, we will have the four underground areas that I showed there. So the OK Mine. Racetrack, while it will be supported from OK, and that is a great advantage of Racetrack, we can use the box cut for OK, we can use the office and workshop infrastructure, but we will set it up as a separate mine with a separate ventilation circuit. So there will be those 2 mines there. We will have the main field that I showed you in that growth area, operating with 3 areas within that and the Scotia underground mine. So those operating together is where we see that 200,000 ounce profile.
Maybe one from me, Paul, to close out the talk. Your balance sheet is in great shape. You have been active with a buyback through the course of fiscal 2026. Maybe just some thoughts on capital allocation and how you might look to deploy some of the cash you are building.
Yeah, sure. Thanks for reminding me, actually. It is something I missed through the presentation. But we have had a long-held policy that we intend to maintain a AUD 250 million balance sheet. Effectively, so that as we make these new discoveries, we have all the capacity that we need to fully drill the new discoveries that we have and to continue that expansion. And also obviously to develop these new mines. So we are fully covering those things and adding strong cash flow to the balance sheet right throughout that process now. So as we sit above that AUD 250 million level, we will go back to making that buyback active. We are in a position now where we will have used most of the tax credits, which will allow us to start paying franked dividends in the not-too-distant future. So dividends and buybacks will become the primary options.
I think the last thing to say there is that you can see that Norseman is now in a very self-sustaining position. It is in a very strong position. It is allowing us to go out and have a look at additional acquisition opportunities. So, the company will get active on that front as well.
Great. Well, thanks very much, Paul. Bang on time. I appreciate it.
Thank you.