Discovery Silver Backing Supports Abitibi Metals Growth Strategy

• Discovery Silver plans to acquire a 9.9% stake in Abitibi Metals for $31 million, bringing institutional validation and operational expertise from proven mine builders
• B26 polymetallic deposit grown to 25 million tons at 2.1% copper equivalent over 2.5 years of partnership with SOQUEM (Quebec government subsidiary)
• Fully funded for 80,000+ meters of drilling through 2027, targeting PEA and updated resource, with feasibility study milestones ahead
• Plans to consolidate the broader camp using B26 as flagship asset, with additional acquisitions anticipated and two-year detailed plan coming end of May/early June

Abitibi Metals Corp. (CSE:AMQ) has announced a transformative strategic investment from Discovery Silver, marking a significant validation milestone for the company's B26 polymetallic deposit in Quebec. The $31 million financing, which will give Discovery Silver a 9.9% ownership stake upon closing, represents both a capital injection and an operational partnership with one of the mining industry's most respected development teams. For investors evaluating junior mining opportunities in a strengthening copper and gold market, the transaction offers insight into how institutional capital is positioning for the next cycle of base and precious metal development.

The Discovery Silver Partnership: Validation from Proven Operators

The strategic investment from Discovery Silver carries significance beyond the capital itself. Led by CEO Tony Makuch, Discovery Silver's management team has an established track record of identifying undervalued assets early and executing operational excellence. Their previous successes include building Lakeshore Gold's West Timmins mine - which remains in operation today - and their work at Kirkland Lake Gold, particularly the development of the Fosterville mine and the acquisition of Detour Gold, now one of Canada's largest producing gold assets.

Jon Deluce, CEO of Abitibi Metals, emphasised the strategic alignment: 

"I think the consistency is how rare these deposits are in the marketplace. And we look at the recent closing of the Foran Mining takeover by Eldorado for almost $4 billion. It showcases the demand for these in the market, but also how rare they are."

The 9.9% stake structure appears deliberate - significant enough to demonstrate commitment and provide strategic input, but not so large as to be dilutive at the current market capitalisation. Deluce noted that Discovery Silver's expertise spans the full development lifecycle, including permitting, First Nations engagement, environmental management, and accessing government grants - capabilities that complement Abitibi's exploration-focused team as the project advances toward feasibility.

B26 Deposit Fundamentals: Scale and Grade in a Tier-One Jurisdiction

The B26 polymetallic deposit represents the core asset driving institutional interest. Over approximately 2.5 years of partnership with SOQUEM, a subsidiary of the Quebec government, Abitibi has grown the resource to a combined 25 million tons grading 2.1% copper equivalent. This scale places B26 among a limited group of sizable polymetallic deposits in Canada with development potential.

The deposit's copper-equivalent grade incorporates multiple metals, providing diversification across commodities that are experiencing structural demand growth. Quebec's mining-friendly jurisdiction, established infrastructure, and government support through SOQUEM's involvement further enhance the project's development profile.

Recent drilling results from Phase 4, announced in February, demonstrated 150-meter step-outs at strong grades, expanding the deposit at depth. This supports management's thesis that B26 represents a much larger mineralised system than currently reflected in the resource estimate, with potential for significant mine life extension.

Strategic Vision: Camp Consolidation and Value Creation

Abitibi's stated objective extends beyond developing B26 as a standalone asset. Management views the deposit as the flagship anchor for consolidating the broader camp, leveraging its scale to acquire additional properties and build a district-scale operation. Deluce indicated that additional acquisitions could materialise in the near term, though specifics were not disclosed.

This camp-scale approach mirrors successful strategies employed by major producers who have consolidated fragmented land positions into large, long-life mining complexes. With $31 million in new capital upon closing of the recent financing and no warrants issued - preserving the equity structure for existing shareholders - Abitibi has positioned itself to execute opportunistic acquisitions without immediate dilution pressures.

The market capitalisation trajectory illustrates growing institutional recognition. From a $30 million valuation 12-18 months ago, the company will trade at approximately $150 million post-financing. However, management maintains that a significant valuation gap remains relative to the deposit's scale and development potential.

Interview with Jon Deluce, President & CEO of Abitibi Metals

Capital Deployment: Fully Funded Drilling and De-Risking Program

The proposed $31 million strategic investment provides Abitibi with full funding through 2027 for an aggressive drilling and development program. Deluce outlined plans for more than 80,000 meters of drilling, allocated between expansion drilling to grow the resource and infill drilling to convert inferred resources to the indicated category.

"This injects $31 million in a market that is still volatile... that noise is eliminated. Our medium to long-term projections on both the gold and copper and zinc are very strong. And we now have a war chest to deliver 80,000 meters plus of drilling to deliver the PEA."

The drilling program balances two objectives: demonstrating near-surface, early-payback opportunities for the preliminary economic assessment (PEA), while also testing the deposit's overall size potential for long-term mine life planning. Management identified specific areas where current drill density has likely understated grade and tonnage in inferred categories, presenting opportunities for resource upgrades through targeted infill work.

Beyond drilling, the capital will fund metallurgical testing, geotechnical studies, and other de-risking activities required to advance toward a feasibility study. The fully funded position eliminates near-term financing risk and allows the technical team to execute without capital constraints.

Development Timeline: Near-Term Milestones and Two-Year Roadmap

Abitibi has established clear near-term deliverables for the market. The company targets a PEA and updated resource estimate representing critical milestones that will provide the first economic framework for evaluating B26's development potential. The PEA will focus on near-surface mineralisation and early payback scenarios, while the resource update will incorporate recent drilling to demonstrate overall deposit scale.

For 2027, the drilling budget will shift more heavily toward infill work to support feasibility study objectives, converting resources and tightening geological confidence. Management plans to release a comprehensive two-year plan in late May or early June 2026, detailing specific budget allocations, drilling targets, and expected deliverables across the development timeline.

This structured approach provides investors with defined value inflection points while maintaining flexibility for strategic opportunities. The metallurgical and geotechnical work running in parallel will address key technical questions around processing and mine design before feasibility-level engineering begins.

Market Positioning: Copper-Gold Leverage in a Strengthening Commodity Cycle

Management positioned Abitibi squarely within the emerging copper and gold bull market narrative. The company benefits from exposure to both metals, with copper providing leverage to electrification and energy transition demand, while gold offers portfolio stability and inflation protection.

Deluce noted that major mining companies are "starting to bet on this as a sustained gold market" and that current conditions represent the "early stages of a copper bull rally." This macro backdrop has driven increased merger and acquisition activity, as evidenced by Eldorado's acquisition of Integra Gold in Quebec - a deal, management cited as demonstrating both the scarcity value and market appetite for tier-one development assets.

The Discovery Silver investment brings generalist institutional funds into Abitibi's shareholder base, investors who track Discovery's portfolio and value management's technical judgment. These longer-term institutional holders provide stability and credibility as the company advances through development stages.

Conclusion: A Recapitalised Development Story with Institutional Backing

Abitibi Metals will emerge from this financing as a fully funded development company with institutional validation, a substantial resource base, and clear technical milestones ahead. The Discovery Silver partnership provides operational expertise to complement exploration capabilities, while the $31 million capital injection eliminates near-term financing risk in a volatile market.

For investors, the investment case centers on multiple expansion drivers: resource growth through 80,000+ meters of drilling, economic validation through the upcoming PEA, conversion of inferred resources, camp consolidation optionality, and commodity price leverage in a strengthening market for copper and gold.

Deluce summarised the opportunity: 

"I think there's going to be an inflection point… and we start to make up the value gap that we still see in the market."

The detailed two-year plan expected in May/June will provide investors with greater clarity on capital allocation and value creation pathways. Until then, consistent drill results and technical progress will serve as catalysts for closing the valuation gap management believes exists relative to B26's scale and development potential.

The Investment Thesis for Abitibi Metals

• Institutional Validation: Discovery Silver's 9.9% planned strategic investment at $31M provides both capital and operational expertise from proven mine builders with track record at Fosterville, Detour, and West Timmins
• Meaningful Scale: 25 million ton resource at 2.1% copper equivalent represents significant tonnage in a jurisdiction with limited comparable polymetallic deposits available for development
• Commodity Exposure: Dual leverage to copper (electrification/energy transition demand) and gold (inflation hedge/safe haven) in early stages of projected multi-year bull markets for both metals
• Fully Funded Development: $31M financing provides capital through 2027 for 80,000+ meters drilling, PEA, updated resource, metallurgical testing, and feasibility study advancement without near-term dilution risk
• Resource Growth Potential: Recent 150-meter step-outs at strong grades demonstrate deposit expansion potential; management targets resource upgrades through both infill and expansion drilling
• Valuation Gap Opportunity: Market cap of ~$150M post-financing compared to 25M ton Cu-eq resource; management cites significant undervaluation relative to deposit scale and recent M&A comparables
• Clear Catalysts: Q1 PEA and updated resource, consistent drill results through 2026, two-year detailed plan in May/June, feasibility milestones in 2027
• Camp Consolidation Optionality: B26 serves as flagship asset for broader district consolidation; additional acquisitions anticipated to build multi-asset platform

TL;DR

Abitibi Metals has secured a $31M strategic investment from Discovery Silver (9.9% stake), validating the B26 polymetallic deposit's potential as a rare, large-scale copper-gold-zinc asset in Quebec with 25 million tons at 2.1% Cu-eq. The financing fully funds 80,000+ meters of drilling through 2027, advancing the project toward a PEA and updated resource, with no warrants issued. Management sees significant valuation upside as the market recognises B26's scale in a strengthening commodity cycle, with camp consolidation providing additional optionality for institutional investors seeking leveraged exposure to copper and gold fundamentals.

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