New Found Gold (TSXV:NFG) - Queensway Engineering Development Initiated

Newf Found Gold Corporation: Queensway Project Development Update - Detailed Summary

Key Concepts:

• Queensway Project: Newf Found Gold’s flagship gold project in Newfoundland, Labrador, targeted for first production in late 2027.
• EPCM (Engineering, Procurement, and Construction Management): A contract type where the engineering firm manages the project alongside the company, sharing risk and reducing costs compared to EPC.
• EPC (Engineering, Procurement, and Construction): A contract type where the engineering firm takes full responsibility and risk for the project, typically at a higher cost.
• Pine Cove Mill: Existing 700-ton per day mill being expanded to 1,400 tons per day to process Queensway ore.
• Nugget Pond Circuit: A gravity-leach circuit being relocated and integrated into the Pine Cove Mill.
• CIL (Carbon-in-Leach): A gold extraction process involving leaching gold with cyanide in the presence of activated carbon.
• Environmental Assessment (EA): A process to evaluate the potential environmental impacts of a project and obtain necessary permits.
• Long Lead Items: Equipment or materials with extended delivery times, requiring early procurement.
• Early Works Permit: A permit allowing initial site preparation and construction activities.

1. Project Overview & EPCM Contract Award

Newf Found Gold Corporation is focused on advancing its Queensway gold project in Newfoundland, Labrador, with a target for first production in late 2027. A key milestone announced is the awarding of the EPCM contract to WSP Canada. This decision is driven by the need for detailed engineering, procurement, and construction management to facilitate the project’s phased development. The initial phase involves processing high-grade ore using an existing mill, supplemented by equipment from a previously acquired asset (Maritime Resources). The company has decided to expand the existing Pine Cove mill from 700 to 1,400 tons per day, utilizing equipment from the Nugget Pond site.

2. EPCM vs. EPC & WSP Selection Process

Keith Bole, CEO of Newf Found Gold, explains the rationale behind choosing EPCM over EPC. EPC contracts transfer significant risk to the engineering firm, resulting in a higher premium cost. EPCM, conversely, involves a collaborative approach where the company works closely with the contractor, reducing costs while maintaining control.

The selection of WSP Canada followed a competitive process involving seven firms, resulting in five proposals. WSP was chosen due to their demonstrated experience with similar mill expansion projects, specifically highlighting relevant experience with other mill expansions. The emphasis was placed on the quality of the proposed team and their relevant expertise.

3. Mill Expansion Details: Pine Cove & Nugget Pond Integration

The Pine Cove mill, currently processing 700 tons per day from the Hammerdown mine, will undergo a significant transformation. It will be converted from a grind-flotation-regrind-leach-Merrill-Crow circuit to a full gravity-leach (CIL) circuit. Equipment from the Nugget Pond site will be relocated and integrated, creating a parallel 700-ton per day plant alongside the existing mill, resulting in a total processing capacity of 1,400 tons per day. This configuration will allow for the separate processing of Queensway ore.

4. Project Execution & Timeline Management

Successful execution is paramount to achieving the late 2027 production target. Newf Found Gold has established a clear framework for managing multiple concurrent tasks, likening it to “keeping plates spinning.” Key elements include:

• Permitting: Jared Saunders, VP of Sustainability, is leading the permitting process, aiming to submit the environmental assessment application this quarter.
• Project Financing: Cutfield Freeman has been engaged to secure project financing for the Queensway development, with encouraging initial interest from potential investors.
• Engineering & Procurement: WSP will handle detailed engineering, procurement of long-lead items and construction contracts, and materials purchasing.
• Construction Management: WSP will act as a general contractor, managing subcontractors during the construction phase.

5. Permitting & Environmental Assessment Process

The environmental assessment process is being managed independently by Stantech, the same firm that successfully completed the EA for Firefly in 45 days in 2025. The focus is on submitting a high-quality application to expedite the review process. The EA process is independent of WSP’s engineering and construction activities, providing flexibility in the overall project schedule.

6. Flexibility & Risk Management

Newf Found Gold emphasizes the importance of maintaining flexibility throughout the project. Rob Assabi, Chief Operating Officer, will serve as the central point of coordination, ensuring effective communication and enabling course correction as needed. WSP has already begun work, integrating into the company’s overall team. The company recognizes the need to adapt to potential changes in geology, costs, or sequencing during the project lifecycle.

7. Future Updates & Guidance

Newf Found Gold plans to provide regular updates to the market on key project advancements, particularly regarding the environmental assessment, project financing, and procurement of long-lead items. The company will communicate progress against the established timeline, demonstrating its commitment to achieving the late 2027 production target.

8. Owner-Build Rationale & Expertise

Keith Bole highlighted the necessity of engaging an experienced partner like WSP, particularly for smaller companies lacking the internal resources to manage a complex project of this scale. He emphasized that attempting an owner-build approach would be impractical given the company’s size and the project’s complexity.

Notable Quote:

“EPC is great, but it’s… having been on the contracting side, it’s less expensive when you work together with a contractor than it is when you give them all the risk and they’ll charge you the premium for it too.” – Keith Bole, CEO of Newf Found Gold Corporation.

Technical Terms:

• Grind Flotation: A process used to separate valuable minerals from waste rock.
• Regrind: A secondary grinding process to further liberate valuable minerals.
• Merrill-Crow Process: A chemical process used to recover gold from solution.
• Leach: The process of dissolving valuable metals from ore using a chemical solution.
• CIL (Carbon-in-Leach): A gold extraction process involving leaching gold with cyanide in the presence of activated carbon.

Conclusion:

Newf Found Gold is strategically positioned to advance the Queensway project towards production in late 2027. The awarding of the EPCM contract to WSP Canada represents a significant step forward, leveraging external expertise to manage the complex engineering, procurement, and construction phases. The company’s phased approach, coupled with a robust project management framework and a focus on securing necessary permits and financing, demonstrates a commitment to delivering on its ambitious timeline. The emphasis on collaboration and flexibility will be crucial for navigating potential challenges and optimizing project outcomes.