Cartier Resources Unveils C$1 Billion NPV at Cadillac

0:16Welcome back in to Mining Stock Daily, everybody. Busy couple days here as we try to wrap up the week heading into Beaver Creek for next week. And it has been a newsful week. And so we're going to pick up one of those news items with our friends from Cartier Resources. They do trade on the TSX Venture with ECR and on the OTCQB with ECRFF. This morning, the company published an updated preliminary economic assessment for the Cadillac project up in the Valdore area of the Abitibi. Now, this replaces the 2023 PEA. And for many of you who have been following the story, we know this is a much different project than it was three years ago.

1:03Happy to welcome in CEO, Mr. Philippe Cartier once again. So Philippe, three years, different project, different economics. Why publish an updated PEA at this time? That's a very good point. Indeed, when we published the one in 2023, we had a resource of 2.3 million ounces. We were using a price of gold of$1 ,750 US dollars. We went full out Cadillac, you know, top, build your own mill right from the start. And so we had a hefty CapEx for a project which wasn't fully evaluated yet. And we were using the historical metallurgical recoveries of, you know, 93%. And as you know, for most of the former mine life of the Chimo Mine Project, because it is a past producer, they never had a mill on site.

2:01So they were using somebody else's mill and it wasn't really, this is 1997. So it wasn't like calibrated. Fast forward to today, well, 2026 PA has an added 1.1 million ounces. So we're using a base of 3.2 million ounces. We are using a price of gold in an upward market. Gold is now trading at$4 ,400, but we're using$3 ,600. And then we're using metallurgical results from a recent study that we did on recent drilling, which much better recoveries and 95 or 96 % recoveries. And then finally, you know, there are mills along the highway. Notally Agnico has two or three mills, Goldex, Lebron, Canadian Malartic.

3:04Eldorado has a Lamac mill. West Dome has their mill. The Nyan Gold has a mill. And then there's two newcomers. There's one, it's a junior mining company that bought a smallish mill. And then there's Fresnel who bought Probe. So, and this time around, we said, listen, it makes a lot of sense from an environmental point of view, from a trying to reduce the upfront CapEx point of view. So this time around, we came around with a hybrid approach of starting out with the toll milling, you know, getting warmed up and then building your mill as you're paying yourself back. So it's a much different product.

3:43And yet the thing that hasn't changed is there's tremendous upside. You know, we have not included the new discoveries that we made with the recent drilling that we've done. So we already know that the resource can grow. We already know that we have new zones that can contribute to this, to a next study. The contact discovery was like really high grade, multi-ounce veins, although they're thin. and then the hope discovery was a Canadian Malartic lookalike. And then finally, one thing to be noted is that the local communities, be it First Nations or the city, they tend to ask more questions if it's an open pit approach.

4:31So for this version of the scoping or economic assessment, we've evacuated that. We're saying, look, we're going to go with an environmentally friendly, full underground approach. And so there's so much upside if working forward from this. But today's numbers are striking. You know, they're very, very good, as you mentioned. Yeah. You did use a$3 ,600 per ounce base case. That brings the Cadillac up to an after-tax NPV of about a billion dollars Canadian, an after-tax IRR of 26.6%. Obviously, those numbers are greatly improved at current spot prices. So I'll let people go back and dig into that news release to get those numbers.

5:17But I'm glad you mentioned the toll milling idea here, Philippe, because that really stuck out with me. And I know the PEA, it's preliminary in nature, right? Like this is a snapshot of what a potential mine situation could look like at Cadillac. By no means are we hanging the hat on this being the final idea. But the toll milling, even though it's preliminary, does that require having some sort of understanding if you're toll milling where it's going to be told to? Have you had those conversations with your neighbors and peers? It generally does. Some companies go as far as signing agreements, MOUs, and I'm not saying that's out of the picture.

5:58Anybody that's high-level thinking will understand which mills we've actually simulated the toll milling agreement on. And although this is preliminary, I think you're probably right in pointing it out. When you're in mine country, this is only a 30-minute drive from these mills, right? So this PEA is not fluffy. It's being monitored by senior producers. So the next step would be to entertain or to ink, deal with the mill that we've looked at. But then there's three other mills. So from that standpoint alone, there could be competitive attention being built. And then there's, well, just look at, you know, Frizzneo recently bought Probe.

6:51And there's no way they could tow mill because it's a very low grade, a lot of ounces, but low grade. So they're going to have to build their mill. So potentially that's an extra mill to consider and down, you know, as we move along. But the thing, but you're right though, the main thing about tow milling is one, you're fast tracking your approach. because building a mill is what? A minimum 18 month process. And I think if everybody's happy with it, especially the Ministry of Environment, they'll look at this and they'll say, hey, you're actually giving us more time to consider options and no environmental scarring and et cetera, et cetera.

7:41So that is, and for us, I think the major point is we're coming in with a project that is hovers around$275 million of CapEx to build this thing. And our market cap right now is about$150 million. So it just adds another layer of optionality for us. Yeah. The other data point that really caught my attention, obviously you mentioned the CapEx, that caught my attention. The mine life, 16.2 years, that really exceeded my expectations, but still I think it's constructive because as you mentioned, there's a lot of mineralization that's been drilled that is not included in this PEA. So that 16 years is really just a starting point.

8:32Absolutely. So people watching this should expect to see that extended as more data, more technical reports are published. Absolutely. This is a case where you're looking at a project which has a long mine life that will naturally exceed 16 years. I don't think it's a project that naturally is amenable to mine expansion. But mine life, life of mine extension, yes. And listen, the resource base is 3.2 million ounces. We've only considered 1.6. obviously the mine life can be extended once we convert the inferred into measured and indicated and then you're looking at a really interesting project because once it's paid back you're on cruise control and that's significant annual cash flow from one operation and you did mention the sensitivity of the gold price for every, um,$600, uh, dollars per ounce increase, you're looking at half a billion dollars increases NPV.

9:41Um, so yeah, the looking forward, everybody's hoping the price of gold will not only be maintained, but will increase. And, uh, and then once you're paid back, it's a walk in the park. All right, Philippe, huge technical report. This obviously, again, preliminary, kind of puts another foundation on Cadillac. The last time you and I discussed, it was a couple months ago. It's been kind of quiet from the company, but you did kind of mention a rethink of strategy with your drill program. Now that this is out, what is the strategy with Cartier and the Cadillac project going forward? Are you thinking you're starting to get those drills turning more rigorously?

10:25Very appropriate question. With these numbers and the recommendations and the proposals that are being put forth by the engineering group, the pencils are being sharpened. We could go full out. But right now, what we want to do is we want the least dilutive path to building more value. in these rising gold price markets. And we have the luxury because we're right near the mining camp of available workforce and infrastructure. So we have that luxury of, you know, really sharpening our pencils to come up with a plan that's going to build even more value. So I'd be hard put right now to tell you how many drills we're going to bring out there, what we're going to do next, because the last thing I want to do is over promise and under deliver.

11:21So far, I think we've delivered on every single promise that we've made so far. And I want to keep that trend. I want to keep that track. Yeah. The equity has performed nicely since March. It's a beautiful higher high, higher lows chart throughout, basically since the spring here, Philippe. So congratulations on that. And we got$5 million in the bank, right? So we've got another luxury that takes an extra month or two to really think it through and get these results to really hit the market and get the right people to be aware of what we have. And then the creative thinking and solutions can really kick in.

12:08Yeah. Well, I'm just thinking, because before we press record, you and I chatted about the plethora of investment conference you and I will both be attending. So you and I are going to be having more of these conversations pretty frequently over the next two or three months, obviously. But what is Newsflow going to look like, Philippe? I mean, what's something on the horizon that your investors should be paying attention to and you and I can chat about? Okay. Well, obviously, the full report, the full three or 400-page report, this thing will come out in the next month or so. Then there's keep your eye on the toll milling stuff.

12:45there may be news on that. There's obviously news from our partners that are working, our JVs that we signed, the deal that we did with Epic Gold. I think they're due to deliver a resource estimate on our Wilson project, a resource estimate on our Benoit project, a resource estimate on our Fenton project. So we're chalking up ounces on projects that are being funded by partners and that agreement brings in revenue by itself, you know, simply in cash payments and share payments. And they're committed to advancing those projects and they're a really good outfit, you know, they do good work. So that news flow will benefit us.

13:26And there's obviously going to be additional news flow on Cadillac and it's going to be high-level news flow. Don't know when the drills will contribute to that, but, you know, keep posted. Okay. All right. Philippe, good to see you. And we will see more of you in the coming months. All right. Looking forward to congratulations on a fantastic PEA, but obviously more to come. All right, everybody. Cartier Resources trades on the Venture Exchange with ECR and on the OTCQB with ECRFF. Philippe, we'll talk to you again next few weeks. For sure. Have a good one. Bye now. The information presented should not be considered investment advice.

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