Production Decision Draws Closer for Canadian PGM Deposit

by Mike Fagan

Mike Fagan

Generation Mining (TSX: GENM)(OTC: GENMF) — currently trading just below C$1 per share — has announced committee approval of the company’s recently released Feasibility Study on its 80.7%-owned Marathon palladium-copper project in northwestern Ontario, Canada.

The management committee consists of representatives from both Gen Mining and its joint venture partner Sibanye-Stillwater (NYSE: SBSW), which holds certain back-in rights allowing it to increase its interest in the project to 51% and become operator.

The Feasibility Study outlines a scenario for 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

Gen Mining, as current operator, has until July 22, 2021 to make a commercial production decision, which also serves as the exercise date for Sibanye to increase its ownership stake from 19.3% to 51%.

Assuming a commercial production decision is confirmed, either scenario should bode well for Gen Mining and its shareholders:

  • Gen Mining develops the Marathon project as operator with no change in ownership interest [Gen Mining: 80.7% / Sibanye: 19.3%].
  • Sibanye develops the Marathon project as operator [Gen Mining: 49% / Sibanye: 51%] by paying Gen Mining 3x the amount not previously funded by Sibanye and agreeing to fund the capital costs estimated in the study and by funding its proportionate share of costs.

Obviously, in that second scenario, owning around one-half of a major PGM deposit being put into production via the dime of an NYSE-listed producer is certainly not a bad thing to have in one’s portfolio.

In the interim, the environmental assessment process is proceeding for Marathon — which is considered the largest undeveloped platinum group metals (PGM) mineral resource in North America — with resource expansion drilling continuing at the direction of Generation Mining.

If you haven’t already, now is an excellent time to conduct your own due diligence on Gen Mining — and a great place to start is the company’s corporate website.

Be sure to 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.