First Mining Gold

Dan Wilton, First Mining Gold. [laughs] Appreciate everyone coming to join us today here. See some very friendly faces in the audience. I’m gonna walk through a presentation with some forward-looking statements here. First Mining is at a very, very exciting point. Those of us who’ve followed our story for a while know a lot of it has been about advancing two of the largest undeveloped gold projects in Canada. Our Springpole Gold Project in Northwestern Ontario, five million ounces plus, pre-feasibility study done last year.

Springpole has always been about confidence in driving forward on getting not just your environmental, but your social license to develop the project. The last few months have been critical in demonstrating that we’ve got that license. We got our federal environmental assessment approvals at Springpole after an eight-and-a-half year process in the end of June this year, and then in August signed two long-term relationship project agreements with the three main indigenous communities at Springpole. So have those long-term social license agreements in place now. Waiting for our provincial environmental assessment approval. We’re expecting to get that by the end of October. So we’ll talk about what that means ’cause it’s very significant. When you look at large projects in Canada that have made it this far through a permitting process that aren’t yet in construction, right now there’s one of them, and this is it.

We’re also moving forward our Duparquet Gold Project. It’s six million ounces in the middle of the Abitibi Gold Belt. We’ll talk about this. One thing I’m very certain of is that Duparquet is not priced in. There’s a lot of value that needs to come from the Duparquet project. But it is an absolute gem of an asset in the middle of the most sought-after gold district in the world. So well-financed, we just closed a financing last week. We have in excess of $80 million on the balance sheet, and driving forward on very clear paths to move these projects further toward a, call it final investment decision at Springpole looking in really Q1 2028.

So this just, for those of you who might know about the history of the company, it was founded by Keith Neumeyer, the founder and CEO of First Majestic Silver, in 2015, really as a mineral bank. So Keith and some like-minded folks in the early days used a public company to go acquire eight other projects or companies in Canada with significant resources at a time when you could buy those resources for $10 an ounce or less. So we’ve actually turned most of that portfolio into cash now over the last five years. It was, until recently, quite a difficult financing environment. So it’s actually these assets that have allowed us to keep doing real work on our main projects at Springpole and Duparquet.

We still have a couple of really important assets on the balance sheet. One is our 20% carried interest in the Pickle Crow project, which our partner, Bella Vista Resources, continues to move forward. A great team at Bella Vista. Those of you who may not know the company or the team that’s running it, it’s the same team that just advanced and sold De Grey Mining in Australia for $5.5 billion. They kind of looked around the world and have picked this project to work on next, which we’re very excited to be a partner in that.

And then we still own 48% of Seva Mining, which is a company we created with the Fiore Group and Frank Giustra earlier this year to move forward our Cameron project. So very interesting project. Million-ounce deposit, 80 kilometers north of Coeur’s Rainy River mine. And it’s got a significant value for us on the balance sheet today, worth about $36 million, and we think that’s only going north as they continue to do really good work to both unlock the social license and advance the technicals of that project.

So we’re sitting today about a 1.2, 1.3 billion Canadian market cap. As I said, $80 million plus of cash in the bank, and still have some other significant assets. Now, this funding will get us to the major milestones that we’re moving forward on, being a resource update at Duparquet, a PFS at Duparquet in the middle of next year, and ultimately driving towards DFS at Springpole Q3 of next year and driving towards that construction decision Q1 2028. Well-covered by a number of analysts who’s picked us up over the last year, I think showing some good momentum on kind of the capital markets profile.

And important to know that the management and directors are significant shareholders in this company. Keith Neumeyer, our chair, would own about the same amount as First Majestic, in kind of the three, three and a half percent range. And the entire management team’s bought stock in our financings and taken a significant portion of our compensation over the last five years of difficult times in equity, so now seeing some of the benefit of that.

So we like to talk about this as the opportunity here. These are the largest gold projects in Canada. We have kind of on a list of developable gold projects greater than five million ounces. As you can see, we have two of them. And if you were to look on this list as to which of these projects could see a shovel in the ground and start construction before 2030, I think you have three on this list that would qualify for that. Springpole is certainly one of them. Eskay Creek’s half or two-thirds built, and Troilus is driving towards its environmental assessment approvals in Quebec next year. But beyond that, most of the rest of these projects really haven’t even entered the EA process.

I said before, we’re at the end of the EA process, expecting to have our provincial environmental assessment approvals by the end of October. That was an eight-and-a-half year process for us. So when you look at the value of these large development projects in Canada, you need to be looking at where they are in that development process because I think it’s critical. We’re very hopeful that all governments in Canada that are talking about the ability to fast-track projects are making headway on that. We hope that every project coming behind us doesn’t have to go through an eight-and-a-half year process. But I think we need to be realistic as investors as to really how we see these timeframes developing. And I would much, much rather be where we are in an EA process [chuckles] i.e., at the end of it, than coming into the beginning of it.

A little bit about our Springpole project, very well located. It’s about 100 kilometers from Red Lake, sitting right in between the two historic gold mining camps of Red Lake and Pickle Lake. We’ve got a power line within 30 kilometers of the project. We’ve got forest roads within 18 kilometers of the project. What’s really unique and strategic about Springpole is really the size and productive capacity of the asset. So even on that prior list, there are very few of those projects that are gonna produce more than 300,000 ounces a year. This is a scale of project in an absolute tier one jurisdiction that is of interest to the largest gold companies in the world.

It’s a great place to be developing. There is a skilled workforce in the area, largely trained in forestry. The forestry industry in this part of Ontario is decimated right now. So lots of good opportunity and lots of real focus from both the feds and the province in seeing the economic development move forward. Springpole will be one of the largest ever investments in Northwestern Ontario, and that provides a real opportunity for thousands of jobs, direct and indirect. It’s billions of dollars of tax revenue, so a really important part of this local economy.

We did a pre-feasibility study update on Springpole last year, and again, it shows a big and robust project. Upfront capital, $1.1 billion U.S., 2.1 billion after-tax NPV at a $3,100 gold price. What’s critical about this as well, very attractive all-in sustaining cost. And we’ll talk a little bit about why it has taken a long time for the market to become focused on Springpole going forward. A lot of it had to do with ongoing legacy perception issues that this was a project, the deposit’s in the Bay of a Lake, and we were never gonna get a permit for it. We can now conclusively say that we’ll get our EA approvals [chuckles] ’cause we have the federal EA approval.

But a big and robust project. Part of that perception issue around the lake, I think gave everyone the opportunity to not have to focus on the fundamentals of this project. When you actually look at the fundamentals of this project, it benchmarks very favorably against most of the other big open-pit mines in Canada. And that has a lot to do with the deposit itself, which is unique. It’s a continuously mineralized porphyry intrusive. It’s 150 to 350 meters wide, a kilometer and a half long, and 500 meters deep. So it’s a giant continuous ore body, which is very different than Coté, different than Greenstone, different than Malartic, different than Detour in terms of the simplicity of how you go to mine that ore body, and the continuity that we have.

So you can see here a very attractive grade profile. A lot of talk about how Coté has emerged as one of Canada’s great mines, and it has. Fantastic project. Just for context, our life of mine gold grade is, with a silver credit as well here, probably 30% higher than Coté at half the strip. When people have to look at this project on its merits, it benchmarks really, really well against the other projects being developed.

And importantly, large projects give you massive leverage to the gold price. And so you just look at our study from last year, the difference in NPV from a $3,100 gold price to a $4,200 gold price, it almost doubles. You’re looking at a project with, at spot gold price levels, a 60% IRR. This is a phenomenally profitable project with a very quick payback, which is gonna get made more quick by some of the moves that the Canadian government’s made last week around accelerated depreciation, and we’re hopeful that more of those types of policy changes are coming. So that’s Springpole, large advanced stage, major, major catalyst coming in the next 18 months, and we’ll talk about what we think that means for the value.

But we never have enough time to talk about Duparquet, so this is our second project which we’re moving forward in the wake of the advancement we’re making at Springpole. The project sits in the middle of the Abitibi Gold Belt. This is half an hour from Glencore’s smelter in Rouyn-Noranda. If you were to drive from the two major centers in the Abitibi of Timmins and Val-d’Or, this is literally the midpoint. So a great place. 19 kilometers of the Porcupine-Destor Fault, one of the two main controlling structures. It’s a past producing mine. It’s a mine that produced a million and a half ounces from underground from 1933 to 1956.

In addition to those million and a half ounces, we’ve got five million ounces in four kilometers of strike that’s there today. So when you talk about the endowment in this project, it’s got a six and a half million ounce endowment in the top 600 meters. So a million ounces per 100 meters. There’s not many projects that can claim that, and one of the only other ones in the Abitibi that would have that kind of endowment would be Canadian Malartic. Amazing infrastructure, as you can imagine, that’s there. Roads, power, highway, a town right there. But most importantly, with a project in the Abitibi, you are in the middle of one of the greatest sources of mining human capital on Earth. Within a two-hour drive of this project, you’ve got many of the greatest mining skilled workers, and pretty much every mining supplier on Earth.

So with that, two main projects, big projects in Canada. One of them that’s got its federal EA approval and driving towards its provincial EA approval. We’re trading today at $70 an ounce. So listen, that’s up from $10 an ounce when we were here last year, so we’re pretty happy about that. But it’s still a lot of room to go. If you look historically at the trajectory that projects have taken as they’ve come through their definitive feasibility studies, they arrange project financing and move toward that construction decision. Typically, you’ve seen projects in Canada trade at somewhere, at that stage, between $200 and $300 an ounce. So lots of upside and runway here to see these projects continue to advance.

Same thing I’d say on the price to NAV ratio. We’re sitting at 0.25 today. Most of our peers would be at this stage traditionally in a 0.5 to 0.7 times NAV. So continue to make really good progress. And one of the other things, again, we wanna really make sure we’re pointing out here is there’s some projects here that are in development, in construction for sure, but with a project with its EA approvals versus one that doesn’t have one in Canada, there’s significant de-risking that’s already taken place on our projects.

So when we think about the NAV, this is the easiest way for us to describe it, just taking the values from our current studies. Challenge is we can only really show the NPV Duparquet at $2,200 gold because that was the upside scenario when we ran [chuckles] those economics three years ago. So where we have that, call it 6.4 billion Canadian, if you run Duparquet at a similar $4,200 gold price, it’s probably in excess of $9 billion Canadian. Obviously, Duparquet is not priced in. It’s something that we really continue to focus on here. The value, and in terms of how we see the re-rating potential with really significant near term catalysts with Springpole and with Duparquet, it’s a very clear path that we could see the share price go up, I think three to four X in the next 18 months as we just deliver on the catalysts that we’re well-funded to do.

And the other thing, if you, like we, believe that the gold price is going higher, and given what we’re seeing in the world, I think that’s a given at this point. What you get with these large projects is massive leverage to the gold price. So every $100 in the gold price with our projects is $230 million of after-tax NPV. And there’s not many other projects in the world or companies in the world that can give you this kind of leverage to increases in the gold price. So our projects are economic at much lower gold prices, we’ve shown that, but this is very, very significant leverage to the gold price here.

So major catalysts upcoming. Obviously, we’ve started to see some of that re-rating happen with the announcement of the Federal Environmental Assessment approval that we got at the end of June. Significant part of that re-rating coming with the demonstration of our social license by signing our long-term project agreements with Cat Lake, Lac Seul, and Slate Falls at the end of August. That’s now five indigenous communities that we have long-term agreements with, so we really have our social license intact from that perspective. And very excited about the opportunities that this is presenting, and we’re already seeing some of the benefit driving into those communities, which is one of the highlights of my career and my time here at First Mining Gold, seeing how these projects are going to contribute to the indigenous communities we’re working with.

So importantly, the equity financing has given us the runway to hit really all of the key project milestones we’re talking about over the next 12 months. Next October, we’re expecting the provincial environmental assessment decision, so that should be coming within 30 days. And then driving on to the feasibility study at Springpole, detailed engineering in support of permit applications, application and submission of an initial closure plan for early works for Springpole coming in the first half of next year, driving towards the submission of a final closure plan, detailed engineering in support of all of those permit applications, ultimately pushing toward a definitive feasibility study, which we’re expecting in September of next year. Project financing, which should come shortly after that, and driving towards that final investment decision in Q1 2028.

On top of that, a very, very busy year at Duparquet, so we’re putting out an updated resource in Q1 that’s gonna reflect 50,000 meters more drilling in that deposit. We have the resource update coming up with that, as I said, in Q1, and driving towards a pre-feasibility study update at Duparquet, which we think is gonna show a multi-billion dollar NPV. We should be seeing that PFS kind of by the end of Q2 next year. So a very, very catalyst-heavy year coming up in addition with drilling at Duparquet. We should have drill results that’ll be coming out consistently and, on top of that, drill results at Springpole as we continue to move the project forward.

So I wanna thank everyone for their time and, if anyone wants to catch us, we’ll be just outside after the presentation. But thank you very much.

Thank you very much, Dan.

Thanks.