High-Margin Gold Producer Emerging With 8 g/t Quebec Mine Restart H2 2025

• Abcourt Mines is a gold development company in Quebec that owns the Sleeping Giant mine and plans to start gold production in the second half of 2025.
• The Sleeping Giant mine has 400,000 ounces of resources (half indicated, half inferred) at 8 g/t gold with significant upside potential to the east and at depth.
• The company has secured an $8 million USD loan from Nebari and is raising additional equity to fund the restart of the mine, with first-year production targeted at 10,000 ounces.
• Production is expected to ramp up to 30,000 ounces per year with an all-in cost of $1,400 USD per ounce, leaving substantial margins at current gold prices.
• Abcourt's strategy is to first extend the mine life (currently six years) before expanding production, as the mill is only being used at 40% capacity initially.

In a recent interview, Pascal Hamelin, President and CEO of Abcourt Mines (TSXV:ABI), outlined the company's path to becoming a gold producer in the second half of 2025. The Quebec-based company is advancing its 100%-owned Sleeping Giant mine with financing secured and development plans in place. With high-grade resources, existing infrastructure, and significant upside potential, Abcourt represents an emerging gold producer in a favorable jurisdiction during a strong gold price environment.

Company Background and Transformation

Three years ago, Abcourt Mines was losing money by mining the low-grade Elder deposit (3.5 g/t gold) and trucking material 200 kilometers to the Sleeping Giant mill. As Hamelin explained: 

"The Elder mine was a low-grade deposit 3½ g/t and with the trucking and the lack of development, the lack of exploration ahead of that mine, we were not mining the proper tonnage, the proper ounces per month. So the G&A was killing the mine."

Upon joining the company, Hamelin shut down the unprofitable Elder operation and redirected focus to the high-grade Sleeping Giant mine. The company spent two years advancing geological understanding and engineering studies for the project. In fall 2023, Abcourt began underground drilling to increase confidence in the resource, followed by extensive exploration and underground rehabilitation work throughout 2024.

Hamelin noted that rising gold prices throughout 2024 continued to improve the project's financial model. This led to negotiations with lender Nebari, culminating in a Letter of Intent in April 2025. The company is currently completing due diligence and finalizing financing arrangements to begin development toward commercial production.

Resource Base and Exploration Potential

The Sleeping Giant mine currently hosts approximately 400,000 ounces of gold resources equally divided between indicated and inferred categories, all at an impressive grade of 8 g/t. According to Hamelin, the deposit has "a lot of upside potential to the east and at depth."

Historically, the Sleeping Giant was mined near surface and close to the shaft, leaving significant areas unexplored. 

"Everything east and at depth is untouched and very little drilling done.”

The company conducted exploration drilling this winter to validate their geological model, confirming potential for expansion in these untapped areas.

With three drill rigs currently operating at the site, Abcourt is transitioning from exploration to definition drilling. Their goal is to continue increasing the resource base over the next two years, with an ambitious target of reaching one million ounces. This would significantly extend the project's mine life beyond the current six-year plan.

Production Plan and Economics

Abcourt plans to begin gold production in the second half of 2025, targeting over 10,000 ounces in the first year. While this initial output may appear modest, Hamelin emphasized the company's lean structure: 

"It looks small, but it's a single asset. We're a small company, not much G&A, so 10,000 ounces will get us going."

The current life-of-mine plan outlines six years of production at approximately 30,000 ounces annually, totaling around 180,000 ounces. The economics are particularly attractive given the high-grade nature of the deposit.

The mill will initially operate at only 40% capacity, providing future opportunities for production expansion once the mine life has been extended through successful drilling. The company expects a gradual 18-month ramp-up period to reach full production of approximately 2,500 ounces per month.

Grade control appears robust, with Hamelin stating: 

"The first quarter is around seven [grams] diluted grade to the mill. That's the expected grade. The second quarter 7-8. It's around that range all the time." 

Historically, the Sleeping Giant mine operated with a head grade of 10 g/t over its 30-year production history.

Financing and Capital Requirements

Abcourt has secured an $8 million USD (approximately $11 million CAD) loan from Nebari, a good partner with over 42 successful mining deals. The three-year loan provides the capital needed for pre-production operating costs, with limited capital expenditures required.

The company has already closed two tranches of a private placement equity financing and has approximately $2.3 million remaining to raise. Management is also exploring subordinated debt or gold loan options to further reduce project risk.

Key capital expenditures include tailings facility upgrades, a sleep camp to attract workers from a broader region, and underground development and rehabilitation work. The company is leveraging existing infrastructure wherever possible, including the mill, which is already operational following a bulk sample processing in 2024.

"The mill's ready. Of course, there is some investment to make in the mill in instrumentation here and there, but it's not significant and you can do it while you operate the mill."

Interview with CEO Pascal Hamelin

Operational Readiness and Permitting

The Sleeping Giant project benefits from being an existing mine site with substantial infrastructure already in place. The mill is operational, and multiple mining stopes are already prepared for immediate production once financing is finalized and workers are hired.

"The stopes are already defined. We see it, the stopes are ready to go. It's just a matter of hiring the proper labor and start blasting." 

On the permitting front, Abcourt is in the final stages of authorization for the next tailings facility lift, which will provide capacity through 2031. Hamelin characterized these as "construction permits more than environmental permits," noting that restarting an existing mine site involves fewer regulatory hurdles than developing a greenfield project.

The company is also implementing a sleep camp at the mine site to attract workers from a broader region, as the property is located 80 kilometers from the nearest town. This strategy aims to address potential labor challenges in the competitive mining sector.

Regional Opportunities and Corporate Strategy

The Abitibi-Témiscamingue region of Quebec is experiencing significant merger and acquisition activity, with several major producers (IAMGold, Eldorado Gold, Wesdome, and Agnico Eagle) seeking to secure additional ore sources for their mills.

Abcourt's strategy differs from these majors, who typically target deposits capable of producing 100,000-200,000 ounces annually. As Hamelin explained: 

"I'm okay with 30,000 [ounces] because the margins are excellent."

The company has applied for toll milling permits, positioning itself to potentially process ore from other deposits in the northern range of the region, where mill capacity is limited. Abcourt also holds a 500-square-kilometer land package with several earlier-stage assets that could eventually provide additional feed for the Sleeping Giant mill.

Technical Expertise and Geological Approach

Abcourt has conducted extensive technical work to prepare for production, including creating a comprehensive 3D geological model from over one million meters of historical drill data. This model has revealed numerous high-grade intercepts that were never properly followed up, providing ready targets for resource expansion.

The company is employing modern geological software and techniques to optimize exploration, with two full-time geologists from an independent firm working with Abcourt's team to refine the structural model and identify new targets.

For processing, Abcourt has established robust procedures, including adding cyanide directly in the grinding circuit to optimize gold recovery. Hamelin identified the grinding circuit as the key to success: 

"If you keep an eye on your grinding, you're going to be successful."

With these technical elements in place and financing nearing completion, Abcourt appears positioned to transition from developer to producer in the coming months, potentially capturing the benefits of currently strong gold prices.

Future Growth Opportunities

While maintaining a disciplined focus on the Sleeping Giant mine, Abcourt has identified potential growth opportunities within its existing portfolio. The company's VP of Exploration has been evaluating other assets within the company's 500-square-kilometer land package, identifying projects that could potentially become future producers.

One such project is a prospective open-pit deposit with grades around 3.5 g/t gold. Although this is currently a secondary priority, it represents potential future mill feed for the Sleeping Giant facility once the primary mine's life has been extended and operations stabilized.

Hamelin emphasized that the company's immediate priority is to reassure investors by demonstrating successful execution at Sleeping Giant before pursuing these additional opportunities: 

"Our focus will be 80% of the free cash flow, we'll go on Sleeping Giant to make sure that we're extending the life of mine."

This measured approach to growth, combined with the high-grade nature of the flagship asset and the existing infrastructure, positions Abcourt to potentially deliver significant returns as it transitions into production during a favorable gold price environment.

The Investment Thesis for Abcourt Mines

• Near-term producer: Set to pour first gold in H2 2025, transitioning from developer to producer at an opportune time in the gold market cycle
• High-grade deposit: Resource grade of 8 g/t gold significantly exceeds industry averages, providing robust economics even at lower gold prices
• Exceptional margins: All-in costs of $1,400/oz offer high margins at current gold prices, generating substantial potential cash flow relative to market capitalization
• Existing infrastructure: Mill and mine infrastructure already in place, minimizing capital requirements and shortening timeline to production
• Substantial exploration upside: Historical mining focused near-surface and near-shaft, leaving significant untested potential to the east and at depth
• Disciplined growth strategy: Focus on extending mine life to 10+ years before expanding production rate, optimizing long-term value
• Strategic location: Operating in mining-friendly Quebec with limited regional mill capacity, creating potential toll milling opportunities
• Financing secured: $8M USD loan from Nebari (mining-focused lender) plus equity raise, providing runway to production
• Modest valuation: ~C$40M market cap presents potential re-rating opportunity as company executes transition to producer status

Macro Thematic Analysis

Gold has established a strong upward trend, breaking through previous resistance levels and reaching historical highs in early 2025. This bullish price environment is creating significant opportunities for near-term producers like Abcourt Mines, which is positioned to begin production during what many analysts consider an advantageous period in the precious metals cycle.

Several macro factors continue to support gold prices: persistent geopolitical uncertainties, central bank accumulation, and ongoing concerns about inflation and currency debasement. For junior mining companies transitioning to producer status, this environment magnifies the economic potential of high-grade deposits, as demonstrated by Abcourt's projected margins.

Quebec's mining-friendly jurisdiction further enhances the investment case, offering stability and established infrastructure in a region with significant historical gold production.