Talamore Mining (TSX: TALA; US-OTC: TALMF) has secured the remaining major permit needed to complete the 214-km all-season road to its Coffee gold project in Yukon, removing a key infrastructure... The post Talamore gets key road permit for Coffee gold project appeared first on The Northern Miner .
Talamore Mining (TSX: TALA; US-OTC: TALMF) has secured the remaining major permit needed to complete the 214-km all-season road to its Coffee gold project in Yukon, removing a key infrastructure hurdle ahead of a planned construction decision early next year.
The company is backed by a $638-million (US$460-million) project financing package assembled in July, including $400 million in secured debt from a syndicate led by Canadian Mining Hall of Fame member Pierre Lassonde and Trinity Capital Partners, a $149.5-million equity financing led by Stifel Canada and BMO, and up to $88 million from warrant exercises. The road may cost $71.3 million, according to a preliminary economic assessment (PEA) in February.
“Today’s update is positive for Talamore and provides a supportive readthrough for the whole Yukon mining industry,” National Bank of Canada mining analyst Rabi Nizami said in a note. “Our outperform thesis on Talamore considers: A near-term development opportunity at Coffee for an intermediate-scale, low-cost, heap leach gold project with rapid payback economics.”
Coffee ranks among Canada’s dozen largest undeveloped primary gold projects by measured and indicated resources. The permit allows Talamore, formerly Fuerte Metals, to build about 29 km of new road linking existing sections of the Northern Access Route from Dawson City. About 180 km already exists.
Map courtesy of Talamore Mining.
Shares in Talamore Mining declined 0.8% to $9.55 apiece Monday morning in Toronto, as gold companies weathered increased chances of a U.S. interest rate hike this month and investors considered how the stock has gained nearly 600% over the last 12 months. The company has a market capitalization of $1.53 billion.
“Securing this final critical infrastructure permit represents a pivotal milestone for the Coffee project,” CEO Tim Warman said in a release. “Our focus now turns to finalizing the feasibility study and securing the two remaining primary mine licenses.”
Initial capital costs are estimated at $983 million, according to the PEA. At a long-term gold price of US$3,620 per oz., the study has an after-tax net present value at a 5% discount rate of US$2.3 billion, a 48% internal rate of return and a 1.7-year payback period.
Talamore still needs its quartz mining and Type A water licences before mine construction can proceed. Public comment on the water licence is scheduled to close Sept. 15, while the quartz mining licence is nearing the end of the detailed information-request stage, the company said. It expects both approvals before the planned investment decision.
A feasibility study by G Mining Services is due in the first quarter. Talamore has completed 20,000 metres of infill drilling at the higher-grade Supremo Extension aimed at converting inferred material for potential inclusion in the study’s reserve estimate.
The PEA outlined an open-pit, heap-leach operation producing an average of 249,000 oz. gold annually over its first five full years and 217,000 oz. over a 13-year mine life. All-in sustaining costs were estimated at US$1,274 per ounce.
Coffee contains 80 million measured and indicated tonnes grading 1.15 grams gold per tonne for 2.96 million oz., according to a 2025 resource. It also hosts 21.2 million inferred tonnes grading 1.17 grams for 800,000 ounces.
Talamore acquired the roughly 700-sq.-km project from Newmont (TSX: NGT; NYSE: NEM) last October in a deal valued at up to US$150 million. Newmont retained about 19% of the company and a 3% net smelter royalty, while Agnico Eagle Mines (TSX, NYSE: AEM) owns about 8%. Fuerte changed its name to Talamore in June and graduated to the Toronto Stock Exchange this month.
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