$1 Billion Palladium-Copper Project May Be Canada’s Next Mine

by Mike Fagan

Mike Fagan

 

Generation Mining (TSX: GENM)(OTC: GENMF) — currently trading right around C$1 per share — has announced an after-tax NPV of C$1.07B and an IRR of 29.7% for its flagship Marathon palladium-copper project in Northwestern Ontario, Canada.

Results of the newly announced Feasibility Study also include a 13-year open pit mine life and 2.3-year payback period with payable metals of:

  • 1.9M oz palladium
  • 467M lbs copper
  • 537,000 oz platinum
  • 151,000 oz gold
  • 2.8M oz silver

Long-term metals prices of US$1,725/oz for palladium and US$3.20/lb for copper were used for the study. Hence, by inputting prices closer to spot [US$2,395/oz for palladium and US$3.99/lb for copper], the NPV of the Marathon Project immediately jumps to C$2.02 billion with just a 1.5-year payback period.

Generation Mining CEO, Jamie Levy, commented via press release:

"This study confirms that the Marathon Palladium and Copper Project is a substantial mining project that is expected to provide a very robust return on investment. We expect the palladium supply in particular to remain in deficit for the foreseeable future as Europe, China and other regions roll out tougher emissions standards. We are excited about the opportunity to create jobs and economic stimulus to Canada, Ontario and to the communities surrounding Marathon."

Executive chairman, Kerry Knoll — whom you’re about to hear from directly — added:

"With the consensus outlook for palladium and copper strong for the next decade, this is a project whose time has come. With little new PGM [Platinum Group Metals] mine capacity being scheduled to come on stream over the next few years, Gen Mining plans to advance the environmental approval process, detailed engineering and mine financing during the remainder of 2021. We anticipate being able to begin construction next year subject to permitting approvals and financing arrangements."

As noted in our previous updates, Generation Mining owns an 80% interest in the project with the remaining interest held by NYSE-listed Sibanye-Stillwater. Sibanye has certain back-in rights that allow it to increase its interest in the project to 51%.

Gen Mining’s present market value of C$150 million — which is just a fraction of the NAV of the project at the company’s 80% interest — points to significant upside potential especially when factoring in the immense exploration upside the project still presents.   

Our own Gerardo Del Real of Junior Resource Monthly sat down with Gen Mining executive chairman, Kerry Knoll, to discuss the results of the Feasibility Study and next-steps in advancing what may soon prove to be Canada’s next PGM mine. Click here to listen to the interview (or read the transcript).

Also, click here for our most recent report on Generation Mining.

Yours in profits,

Mike Fagan

Mike Fagan
Editor, Resource Stock Digest
 

Mike Fagan has mining in his blood. As a teenager he staked countless gold and silver properties in Nevada alongside his dad, Brian Fagan, who created the Prospect Generator model that’s still widely used today in the resource space. One of those staking projects was put into production by a major Canadian mining company — a truly rare and profitable experience. That background uniquely qualifies him as a mining stock speculator. One of the most well-known names in the business, Mike is now putting that experience to use for the benefit of Resource Stock Digest and Hard Asset Digest readers.