Blue Lagoon Resources Inc. continues to progress toward consistent mine production and regular deliveries of mineralized material to its milling partner, Nicola Mining Inc. Following the holiday break, Dome Mountain has resumed production activity, which is set to increase as a result of several new operational measures. The mine is expecting to achieve consistent production of approximately 100 tonnes per day by month-end, positioning the Company to progress toward its fully permitted production level of 150 tonnes per day.
This development matters because consistent production represents a critical transition for junior mining companies from exploration and development phases to becoming revenue-generating operations. For investors and the mining industry, achieving steady production levels demonstrates operational capability and moves companies closer to self-sustaining cash flow. The company's progress toward its permitted production capacity indicates successful resolution of early-stage operational challenges that commonly affect new underground mining operations.
As outlined in the Company's President's Update of November 10, 2025, available at https://www.newmediawire.com, the early stages of ramping up underground mining at Dome Mountain experienced some timing delays. During this phase, a number of operational constraints typical of starting and commissioning an underground mine were encountered and the team identified and addressed these constraints. These constraints have now largely been resolved or mitigated and are no longer limiting underground activities.
Operational highlights include the introduction of a second production shift to enhance productivity and efficiency. The Company is constructing a fire assay laboratory facility, expected to be fully operational by month-end and capable of processing a minimum of 40 samples per day, allowing the mine to receive rapid and timely assay results to help with grade-control and operational decision making. Underground surveying capabilities have been strengthened with the addition of a LiDAR unit, improving accuracy, efficiency, and mine planning.
With the Christmas break concluded, the full operations team has returned to site and underground mining activities have resumed. In December, the Company shipped approximately 1,300 tonnes of mineralized material to its toll milling partner, Nicola Mining Inc., for which the Company received its first payment related to the sale of approximately 1,000 tonnes, as detailed in the press release of December 30, 2025 at https://www.newmediawire.com. The remaining 300 tonnes that were delivered to Nicola remain to be processed and settled. Approximately 150 tonnes of mineralized material is already stockpiled at Dome Mountain and ready for shipment, with trucking expected to commence this week.
These shipments support continued processing activities and the establishment of a regular production and delivery cycle that underpins the Company's transition toward consistent revenue generation. The implications extend beyond the company itself to the broader mining sector in British Columbia, where only nine full mining permits have been issued since 2015 according to company information. Successful production ramp-up at permitted operations can influence regulatory confidence and investment in similar projects throughout the region.
Additionally, the Company received a $500,000 unsecured, interest-free loan from its President to bridge short-term working capital requirements prior to the receipt of initial production revenues. The loan is due on December 19, 2026, or payable earlier at the option of the Company. The Company also reports that several senior employees are being issued an aggregate of 116,884 common shares, subject to approval by the Canadian Securities Exchange.
The progress at Dome Mountain represents a significant step for Blue Lagoon Resources as it works to establish itself as a cash-flowing gold producer. For the mining industry, successful transitions from development to production at permitted operations demonstrate the viability of projects in established mining jurisdictions and can influence investment patterns across the sector. The company's operational improvements and progress toward consistent production levels provide measurable indicators of its advancement toward sustainable operations.
