Streptomyces lomondensis S015 synthesizes the broad-spectrum phenazine antibiotic lomofungin. Whole genome sequencing of this strain revealed a genomic locus consisting of 23 open reading frames that includes the core phenazine biosynthesis gene cluster lphzGFEDCB. lomo10, encoding a putative flavin-dependent monooxygenase, was also identified in this locus. Inactivation of lomo10 by in-frame partial deletion resulted in the biosynthesis of a new phenazine metabolite, 1-carbomethoxy-6-formyl-4,9-dihydroxy-phenazine, along with the absence of lomofungin. This result suggests that lomo10 is responsible for the hydroxylation of lomofungin at its C-7 position. This is the first description of a phenazine hydroxylation gene in Streptomyces, and the results of this study lay the foundation for further investigation of phenazine metabolite biosynthesis in Streptomyces.