Jason Kosec, President and CEO of Integra Resources (TSX-V: ITR; NYSE: ITRG), joins us to outline the synergies from the new combined company with Millennial Precious Metals (TSX.V:MPM – OTCQB:MLPMF), and the key takeaways from the Preliminary Economic Assessment (PEA) on the Wildcat and Mountain View Projects in Nevada.
The new pro-forma Company is now one of the largest precious metals development and exploration companies in the Great Basin, featuring a diversified portfolio of assets including Integra’s past producing gold-silver DeLamar Project in southwest Idaho and Millennial’s oxide-focused Wildcat and Mountain View Projects in western Nevada, with global gold resources of 6.9 million gold equivalent ounces. We go on to discuss how, moving forward, their valuation could re-rate more in line with industry peers, based on their combined resources, development profile, and future exploration growth strategy.
Wildcat & Mountain View PEA Highlights:
- After-tax NPV(5%) of US$309.6 million (“M”) (C$408.6M1) and 36.9% after-tax IRR using base case metal prices of US$1,700/oz gold (“Au”) and US$21.50/oz silver (“Ag”)
- After-tax NPV(5%) of US$442.1M (C$583.6M1) and 49.7% after-tax IRR using spot metal prices on June 27, 2023 of US$1,920/oz Au and US$22.00/oz Ag
- Wildcat & Mountain View generate combined annual production of ~94koz AuEq from year 1-5 with average annual production of 80koz AuEq over the 13 year Life-of-Mine (“LOM”)
- LOM payable metals from Wildcat & Mountain View of 1,043koz AuEq
- LOM site level cash costs of US$882/oz AuEq on a co-product basis; LOM site level all-in sustaining cash costs (“AISC”) of US$973/oz AuEq on a co-product basis
- Year -1 initial capex of US$115M to begin operations at Wildcat
- Average Au Recovery of 71.4% at Wildcat and 77.1% at Mountain View
- Low combined LOM strip ratio of 1.21 (Wildcat standalone strip ratio of 0.28)
With regards to raising the capex needed to develop this Project, Jason reviews that they’ve had regular participation in project financing by Beedie Investments Ltd. an existing lender and large shareholder of Integra. Additionally, Wheaton Precious Metals Corp. (TSX | NYSE | LSE: WPM) also came on as a new cornerstone investor during the merger, with Wheaton agreeing to invest an amount equal to up to 9.9% of the issued and outstanding Integra Shares, providing significant project and transaction validation while also creating a partnership for future project financing.
There are a number of key catalysts coming up for the Company, but an important milestone will be the updated Mineral Resource Estimate and Mine Plan of Operations at the DeLamar Project, which will now include the aboveground stockpiles left behind by Kinross Mining. There will be an aggressive exploration program at Wildcat later in the year and into next year, expanding the deposit and showing how further mine life and output can be grown.
If you have any follow up questions for Jason regarding Integra Resources, then please email me at Shad@kereport.com.
- In full disclosure, Shad is a current shareholder of Integra Resources.
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