Bellevue Gold (ASX:BGL) Surges 7.5% on Deacon North Restart- Is Now the Time to Buy?

Bellevue Gold (ASX:BGL) climbed 7.5 per cent last week after confirming development has resumed at Deacon North, the largest high-grade mining area within its flagship Bellevue Gold Project in Western Australia. First ore production from Deacon North is now targeted for the June 2026 quarter. With shares up around 63 per cent over the past three months, investors are asking whether this rally has further to run or if the stock has gotten ahead of itself.

What are the Best ASX Mining stocks to invest in right now?

Check our buy/sell tips

Why Deacon North Is Critical to Bellevue’s Success

Deacon North is the biggest piece of the puzzle for Bellevue’s future production. The area sits north of the existing Deacon Main orebody and is expected to be a major contributor to output over the next five years. The grade quality here is impressive. Recent drill results include 3.2 metres at 137.8 grams per tonne gold and 4.9 metres at 24.9 g/t gold, figures that support expectations for strong high-grade material.

Development had paused while work was completed at the nearby Armand mining area. Now, a dedicated underground machine has been moved back to Deacon North, and the company has set up independent blasting to speed up progress. Grade control drilling is already underway, which should give management greater confidence in the mine plan ahead of production.

For investors, successful execution here could translate to higher ore grades and stronger cash flow. The Bellevue Gold Project holds a mineral resource of approximately 3.1 million ounces at 9.9 g/t, making it one of Australia’s highest-grade gold deposits. If Deacon North delivers as expected, it could validate the recent share price strength.

Financial Position and Key Risks

Bellevue’s balance sheet has stabilised following a difficult period. The company held A$156 million in cash and gold as of September 2025, with A$100 million in debt and no mandatory repayments until 2027. This gives management room to execute the ramp-up without immediate funding pressure.

However, Bellevue remains unprofitable. In April 2025, the company raised A$156.5 million to cover hedge costs and strengthen working capital after some operational problems. This fundraising reduced the value of existing shareholders’ stakes. While the September quarter showed positive free cash flow of A$33 million before hedge deliveries, consistent profitability has yet to arrive.

On the positive side, Bellevue achieved net-zero Scope 1 and 2 emissions for the first half of 2025, a notable achievement that could appeal to ESG-focused investors looking for “green gold” exposure.

The Investor’s Takeaway

At a market cap of around A$2.1 billion, Bellevue trades at roughly 5.3 times sales, which looks stretched compared to some peers. That said, some analyst models suggest a fair value closer to A$2.98 per share, implying potential upside if the company delivers on its plans.

We believe the Deacon North restart is a meaningful step forward, but this remains a higher-risk opportunity. The investment case depends heavily on execution. If Bellevue hits its FY26 targets and avoids further cost blowouts, patient investors could be rewarded. If the ramp-up stumbles, the stock could pull back quickly.

For growth investors comfortable with execution risk, current levels may offer an opportunity. More cautious investors might prefer to wait for evidence that Deacon North is producing as planned before committing capital.