Fuerte Metals: Developing the Coffee Gold Project in Yukon, PEA and Feasibility Study in 2026

Key Concepts

• Coffee Project: A gold deposit located in the Yukon.
• Fuerte Metals: The company acquiring and developing the Coffee Project.
• Newmont: The previous owner of the Coffee Project, which acquired it through its purchase of Goldcorp.
• Goldcorp: The company that initially acquired the Coffee Project from Kaminak.
• Kaminak: The original discoverer of the Coffee Project.
• Heap Leach: A mining and processing method for low-grade gold deposits.
• Measured and Indicated Resources: Categories of mineral resources with a higher degree of confidence.
• Feasibility Study: A comprehensive study to determine the economic viability of a mining project.
• Preliminary Economic Assessment (PEA): An early-stage study to assess the potential economics of a project.
• Permitting: The process of obtaining regulatory approvals for a mining project.
• First Nations Agreements: Agreements with Indigenous communities regarding resource development.
• Trinity Capital and Pierre Lassonde: Key investors and partners in Fuerte Metals.
• Orla Mining: A company that successfully developed a former Goldcorp asset.

Acquisition and Background of the Coffee Project

Fuerte Metals, led by CEO Tim Warman, has recently acquired the Coffee Project in the Yukon. This project was previously owned by Goldcorp, which had acquired it from Kaminak approximately 10 years ago. Despite disappearing from the public radar for nearly a decade, Goldcorp, and subsequently Newmont (after acquiring Goldcorp), continued to advance the project, investing over $300 million. Fuerte Metals finalized the acquisition from Newmont just six weeks prior to the interview.

Strategic Rationale for Newmont's Sale

Newmont's decision to sell the Coffee Project to Fuerte Metals is attributed to a strategic alignment with past successes, particularly the Orla Mining example. In that instance, Orla Mining acquired the Camino Rojo asset from Goldcorp, paying a significant portion in stock. Goldcorp's initial stake, valued at approximately $15 million Canadian dollars, grew to be worth around $4.5 billion when Newmont sold its stake for $460 million. This precedent suggests Newmont saw a similar opportunity with the Coffee Project: selling the asset while retaining an equity stake in Fuerte Metals, thus participating in the future upside. Newmont currently holds approximately 25% of Fuerte Metals' shares.

Project Advancement and Infrastructure

The Coffee Project has seen extensive work, with a total of 616,000 meters drilled to date. This includes approximately 270,000 meters drilled by Kaminak and the subsequent work by Goldcorp and Newmont. Beyond drilling, significant engineering, infrastructure development, and permitting advancements have been made. Crucially, agreements have been established with First Nations communities. These advancements position Fuerte Metals to potentially make a construction decision by early 2027.

Resource Estimate and Deposit Type

The Coffee Project is characterized as an open-pit heap leach deposit. The current resource estimate stands at 3 million ounces of gold in the measured and indicated categories, with a grade of 1.15 grams per ton of gold. This is considered a very high grade for a heap leach operation, with Warman suggesting it may be the highest-grade undeveloped heap leach project globally.

Feasibility Study and Preliminary Economic Assessment (PEA)

Fuerte Metals is currently initiating its feasibility study for the Coffee Project. While the consultant for the study is being finalized, the company anticipates its completion by the end of 2026. In parallel, a preliminary economic assessment (PEA) is planned for early next year. This PEA will serve as a progress report on the feasibility study, providing initial insights into costs, throughput, and production profiles, as there is no current feasibility or PEA available for the project.

Next Steps and Permitting

The majority of the engineering and test work for the Coffee Project is already completed. The focus for the upcoming year will be on compiling existing data, evaluating minor operational tweaks (such as the order of mining pits or the timing of crushing), and finalizing the remaining permits. The major permit was granted in 2022, with subsequent permits expected to be in place by next year. Additionally, Fuerte Metals aims to commence construction of the access road next year, which would enable construction to begin the following year.

Infrastructure Funding and Yukon Road Project

Fuerte Metals anticipates benefiting from a significant infrastructure project in the Yukon, involving approximately half a billion Canadian dollars in joint federal and territorial funding for building new roads into resource areas. The company believes it qualifies for this funding and has had initial discussions with the government, who are encouraging their application. Engineering for these roads is currently being finalized.

Projected Production Profile

While definitive production figures await the completion of studies, Warman estimates a production profile in a similar range to the previous Cameon study, which projected around 190,000 ounces of gold per year.

Shareholder Structure and Financing

Fuerte Metals recently completed a $57.5 million financing, which was significantly oversubscribed, indicating strong investor interest. This financing is sufficient to fund the company through to the feasibility study. Further financing may be required for initial construction activities next year, depending on permit timelines.

The largest shareholders are:

• Newmont: Approximately 25%
• Agnico Eagle Mines (AgOo): Approximately 8%
• Pierre Lassonde and Trinity Capital (partners): Approximately 18%
• Management: Approximately 6%
• The remainder is held by institutional investors and individuals.

Company Name and Future Plans

The company's current name, "Verte Metals," is considered somewhat misleading given its focus on the Yukon. The name originates from two projects in Latin America (Mexico and Chile), with "Verte" meaning "strong" and referencing a town near a Chilean project. The company is considering a name change in the future to better reflect its primary focus. The Latin American projects are still under evaluation, with decisions on their future (spin-out or sale) pending.

Conclusion and Investment Outlook

Tim Warman expresses confidence in the Coffee Project's development, highlighting the extensive work already completed and the strong investor backing. The presence of major mining industry players among its shareholders suggests a positive outlook for Fuerte Metals and the Coffee Project. The company is moving towards a feasibility study and construction decision, with significant potential for a high-grade gold operation.