Discovery

Thanks, Cosmos. I know we talk about our experience and probably try to say only 45 years maybe. We are starting to age ourselves, and there was a time we weren’t even 45 years old. So I guess we gain a lot of things, and at the same time it’s a good time to be in the industry. There’s a lot of new developments and a lot of exciting things to talk about.

I can talk to you about a lot of different things about what we’re doing in Porcupine or what we’re doing in the company between here and Mexico. But maybe I’m just gonna hit some highlights because I could talk about a lot of positives, whether it’s exploration success, whether it’s development success, mining, and what’s going on in acquisitions and people. But there’s two real material things that are happening. What we’re seeing now, maybe within the next five years, is that Discovery is gonna have probably two of Canada’s largest open pits.

I’ll give you a little bit of things to show you what’s there, but we’re gonna be doing these in a brownfield location where you have existing infrastructure, existing people, existing methods. You got knowledge of how to work. We do exceptional geology. We have permitting. We have things in place that we have to work with. So I think it is actually pretty material in terms of what we’re looking to do to really create growth.

When we talk about how do we grow value in our business, fundamentally, we have to grow the value of the business, right? And you do that through an exploration. You do that with how we invest our capital and build new mines. Do that by how we operate and how we get our standards down, and then we do that by how maybe sometimes you acquire or you got good partnerships. And we’ve been working a lot of these things, and the other part is we’re not just working towards growing the business, and I’m not gonna sit there and say I’m gonna grow production in Porcupine and keep the cost where they are. We actually see the double whammy, where we’re gonna grow production substantially, and we’re gonna reduce costs substantially as well.

And there’s a lot of forward-looking statement slides here. Maybe I can just show you those. I am gonna do a lot of forward-looking discussions here, so hopefully that doesn’t take away from what I’m gonna talk about and what you hear.

Anyway, this slide, it’s just a slide we used a lot in the past, and it talks about our growth through over half a million ounces over the next five years. This is what, when we first did the acquisition in Porcupine, this is pretty much what we’re doing, and it also talks about the potential at Cordero. Cordero by itself, 14 million ounces of silver. If you went by the feasibility study at $22 silver, $1.20 zinc, because it produced a lot of base metal, it was over 37 million ounces of silver equivalent over the first 12 years. Now, the prices have changed, right? And so that silver equivalency might be somewhere around 28 million ounces equivalent a year, but the revenues have actually almost tripled that we get from Cordero as it’s built. And I’ll talk about that later on in the presentation.

But in terms of this slide and what has changed now is we see a sight line to grow production to a much higher level now, three-quarters of a million ounces to over a million ounces over the next five years, and to sustain that for 20, 30 or 50 years in the Porcupine Camp. And the developments of this are exploration success in Timmins. We’ve had exploration success everywhere. Particularly now at Pamour. We see Pamour as being a significant deposit. We still have what was called the Dome Century Pit. I’ll talk to you about that. And then with the acquisition of Glencore’s Kidd operations, it unlocks that opportunity to grow. So we needed to prove with diamond drilling and one year diamond drilling to really outline the potential resources here. We’ve done that. Now we need milling processing capacity, and I’ll show you where we’re gonna go with processing capacity.

This next slide here just kind of gives you a sense on the key drivers of our growth. I mentioned here about Pamour and what we’re doing to redesign Pamour mine. We mentioned about Dome, Dome Molten Pit coming on, and then we still have growth at our other operations. Effectively, what really unlocks this is taking the Kidd. We’re gonna put a brand new conventional gold circuit at Kidd. We’re gonna use part of the other gold circuits at Kidd for processing some of the gold ores effectively at Borden in the short term. And then this plant also unlocks our ability to process. So there’s a large deposit we’re working towards outlining and completing. So the preliminary outline of that this year is TVZ, which could be processed through the Kidd met site. It couldn’t go through Dome Mill because they’re not ores amenable for the conventional gold milling. Actually, Borden wasn’t amenable for conventional gold milling. That’s why we’re putting it at the Kidd met site. And it really unlocks value, and I’ll show you a couple of things here that’s going on.

So this is Timmins. This is what we have. There’s the Pamour operation here. This is Dome, and our mill is here. This is our tailings area we currently have. And this is where the Hollinger McIntyre Pit is. This is where the Kidd Creek met site is, and this is the Kidd tailings area, right? Just to get a sense on where things are.

And then if I go and just try to say a little bit about Pamour, okay? So this is Pamour. Right now, we’re working with developing this open pit here at Pamour. And it’s roughly about total resources here about 3.4 million ounces. We’ve planted and mined it, but getting up to 9,000 tons a day, and eventually get it up to about 12,000 tons a day. So it’s six-meter benches maybe going to nine-meter benches. But we’ve been drilling, right? And I’m probably not gonna do justice, so I have to actually do this on this slide. This is the pit currently that sits at Pamour. And this is what we see, okay? Excuse me. If you get a sense, we’ve probably more than almost quadrupled the resource at Pamour, just down to 300, 400 meters. We have drilling showing down 700, 800 meters. And we have extensive, well over four kilometers, right? And we’re drilling to the north. And so we see this as a very large-scale deposit. We’ll be working on that in terms of what could come from Pamour. I’ll let you guys do the math and what you think it might look like, right?

So the Pamour deposit fit within, it’s a non-conformity between the Temiskaming sediments coming up to another volcanic sequence here. And lots of the Pamour previous mining and exploration was done along that non-conformity. You had the Brule property. You had the Halnor property. You have Coil Pond. They’re sitting in volcanics, and there wasn’t much work done in the volcanics. So on top of what I’m telling you about what’s going on along this contact, the non-conformity, we’re starting to see a lot of work coming up in the walls too, into the volcanics. I can show you other slides at other times that show you what a long-term view is of this whole region, but significant exploration success.

And like I say, from a pit that’s here to a pit that encompasses something like that, right? It’ll start to challenge something like Detourin, and part of the concept is instead of trucking this stuff 25 kilometer round trip to the Dome Mill, which is limited, we’re gonna be able to truck it here to the Kidd met site, which we build a new mill, and we have tailings capacity. We’re gonna work on this tailings dam, and go from 50 million tons of capacity to over half a billion tons of capacity here. So lots of upside.

And then this is Dome. A lot of the time people might have heard about the Century Pit. If someone comes to the Century Pit, we came out of resource over 11 million ounces. We’ve been drilling. We’re getting some positives on that. We definitely can unlock this as we develop the milling capacity in Porcupine. But we see definitely a significant large-scale open pit operation that could be running here.

So getting back to this slide that again just shows the Kidd operations, and this really helps us to unlock the value in Porcupine. It’s gonna add significant process capacity, as I mentioned to you. We can move our Borden ores here and process them here, which is more amenable to the type of ore. It shouldn’t be put in a conventional gold circuit with cyanidation. So we wanna run flotation first to make a float con from this material. Second thing it also does, it unlocks the ability to process now the TVZ ores, which are the potential refractory ore. So that opens up. But we have a circuit here that we can actually use. We have over 100 megawatts of power. We have water. We have a significant tailings area. We have a brownfield site where we can actually build a new conventional gold circuit here that’ll support the Pamour operations and Hoyle Pond operations. And we’re looking at bringing that up to about 40,000 tons a day. With that rate, this thing could be somewhere very close to half a million ounces a year, right? In terms of production, just alone.

And then maybe I went in to explain things. This is just trying to show what we see at this site. And you can see there’s currently four circuits, and trying to outline what we intend to do, where we’re gonna build a conventional circuit right here, and we still are gonna have a base metal circuit. We have multiple circuits. It’s a well-built plant. Always been kept in good operating order over the years. If I go back to the sixties, whoever built it, it was state-of-the-art. It was well put together. And management, operating systems, the way people manage the operations at Kidd, it’s really a testament, and it’s really management systems that we wanna learn. We’ve acquired over 550 people here that know how to work and know how to operate very well, and we’re gonna be able to take advantage of them.

And this slide here is just showing you what we see from our growth in our processing capacity. And you can see we’re gonna go from where we’re sitting, somewhere around three and a half million tons a year capacity, which was now. By the end of 2027, we expect to be to five million. By mid 2027, growing, then second half of 2029, 2030, 2031. So we’re gonna grow the milling capacity, which we’re staging. We’ll be building and investing and building the process out here. So if you think about it, we’re producing somewhere between 260 to 300,000 ounces of gold this year with three and a half million tons of milling capacity. What are we gonna produce when we’ve increased that capacity sixfold? The grades aren’t gonna be all the same because we are bringing some large scale operations, a lot of things on prem process, but a lot of upside, and then we just show what our different mines will do. And for the most part, this is all in place. These are all operating areas where people are working, and we’ve been drilling.

So what are some near-term catalysts? We continue to have exploration results and building on exploration. We do have Cordero, and I’ll talk to you a little bit about Cordero. Right now, we’re completing a number of studies to really tell you what we see, the first resource of Pamour and the updated resources that we expect to come here. What we’re gonna do with the Dome Mill and the Kidd Mine Site Mill, what we expect from a capital investment here, and what we expect in the staging of the various operations as they’re gonna build up over the next five years.

And we still got Cordero, one of the world’s largest undeveloped silver deposits. It’s in the right spot. The capital’s manageable. The previous feasibility capital was just over $600 million. I mentioned to you it was all done at $22 silver, at very good economics on this project. What’s happened since, metal prices, especially silver prices, have almost tripled or more than tripled. The forecast is they’re gonna continue to go higher. Zinc prices are higher. We’re on the verge of getting our permit. We’ve got our change of land use. We’ve actually paid for the change of land use. We’re going through minor things. We’re working at updating the feasibility study. And I can tell you, we update the feasibility study, the capital costs aren’t going up that much. We’ve had a lot of great improvements to what we’ve been looking at. And even if the capital costs go up five or 10%, the revenues have almost tripled on this asset in its current form. So this is definitely an exciting project and gonna bring a lot of new value.

So a lot of value here. You can see brand new discoveries, exploration Pamour, and then with Pamour and Dome and with the Kidd metallurgical facility, unlock ourselves to build new processing capacity that’s gonna significantly grow our operations. And we’re building this in a brownfield area. We’re building it in an area where there’s already operating mines, already operating people. So you look at that and you say, “Jesus, this is definitely stuff that’s achievable.” And we’re not doing anything that state-of-the-art, or sorry. We’re doing everything that’s state-of-the-art. We’re not doing anything that’s leading edge here. We can take advantage of a lot of new developments like the previous thing in terms of AI and build smart mills and stuff like that in these times. But with a lot of opportunity to do things right. We got Cordero and a large project, and I haven’t even talked to you about all the other exploration potential in Timmins and potential third large scale open pit. Maybe I’ll leave that for another time, and maybe if there’s any questions.

No? Thanks, Tony, for a very thorough presentation. There’s one question here. I think we have time for one question. It’s coming, John. Don’t worry. I see you.

Tony, I know you have some constraints under Canadian rules and waiting for 43-101s, but at 40,000 tons a day and 1.1 grams, could Pamour be 465,000 ounces? And at 30,000 tons a day and 1.2 grams, could Dome be 365,000 ounces? Are those reasonable guesses?

I think those are not necessarily reasonable guesses. Those are probably pretty good as assumptions in terms of what we’re working towards.

And you haven’t included in there some of the other sites. So Borden and Hoyle and Owl Creek and TVZ might get you closer to one and a quarter, and we’re not counting the Hollinger McIntyre open pit or five more undergrounds, Hollinger McIntyre, Pamour, Dome, and Paymaster.

Yeah, we haven’t even talked about Paymaster.

And you haven’t begun to drill the Kidd Creek Ground that’s bigger than the Newmont Ground.

Yeah, we don’t even talk about Kidd Creek. We talk about being in elephant country. You’re in one of the largest gold camps in the world. But the Kidd deposit was one of the largest underground base metal volcanogenic massive sulfide deposits in the world, over 170 million tons mined, still open at depth. And the last serious exploration done there is really probably about 20, 35 years ago. So you can see what we’ve done with one year of exploration in Porcupine. Imagine if we spent a year exploring for base metals also. So anyway, I’ll leave you with that. Thanks.

Great. Thanks, Tony. That’s all the time we have. I’m sure Tony will be able to take some other questions on the sidelines. Thank you.