i-80 Gold Presents Potential Opportunity for Nevada-Focused Gold Exposure

• i-80 Gold Mines, led by CEO Ewan Downie, is a new venture formed after selling Premier Gold to Equinox.
• The company has three significant assets in Nevada, a strong cash position with over 80 million Canadian dollars, and no debt.
• Partnered with Nevada Gold Mines, i-80 Gold Mines aims to become a multi-mine producer with a significant cash flow.
• The company was established with an experienced team tailored for operations in Nevada and has plans to be dual-listed on the New York Stock Exchange.
• A Preliminary Economic Assessment for their Getchell project is underway, with aggressive growth and development plans for the future.

I-80 Gold Corp (TSX: IAU) is a recently formed spin-out from Premier Gold Mines, focusing solely on advancing an attractive portfolio of high-grade gold projects in Nevada. Led by CEO Ewan Downie, a veteran mine builder with a track record of success, I-80 is positioned for organic growth. The company has no debt, approximately $80 million cash, and existing cash flow from its 40% interest in the producing South Arturo mine.

With permitting in place and infrastructure already built at its core projects, I-80 can grow production for under $50 million in capital expenditures. The company aims to ultimately become a mid-tier producer generating over 200koz annually in Nevada, one of the world's top mining jurisdictions. I-80 represents a relatively low investment opportunity in the gold sector, offering shareholders exposure to near-term production growth and resource expansion upside.

Portfolio in Top Jurisdiction

I-80's core properties are all situated on the Carlin trend in Nevada, one of the world's premier gold districts. The Fraser Institute ranks Nevada as the #1 mining jurisdiction globally based on investment attractiveness.

The portfolio includes:

• South Arturo - 40% interest in permitted open pit and underground mine currently producing ~20koz Au per year. Additional phases slated to grow output.
• Getchell - High-grade underground project on care and maintenance. Updated PEA and drilling to support potential near-term restart.
• McCoy-Cove - Large open pit and underground opportunity. Prefeasibility study complete with 1.1Moz Au resource. Permitting progressing.

This multi-asset approach provides flexibility, scalability and phased growth optionality. The assets offer both near-term cash flow and longer-term resource upside.

Proven Team to Execute Growth Strategy

CEO Ewan Downie is a founder of Premier Gold and has 30+ years of industry experience. His track record includes building Wolfden Resources into a $1.7 billion company sold to Zinifex. The board and executive team have strong technical expertise in both mine building and underground mining specifically. There is extensive experience operating in Nevada including at South Arturo itself.

Supported by this experienced team, I-80 is positioned to simultaneously advance its portfolio of permitted development assets. The phased growth strategy is designed to progressively ramp up production and cash flow over the next several years.

Funded to Advance Near-Term Development

The current balance sheet provides funding to progress the pipeline of projects. Cash and cash equivalents at end of Q3 2022 were $77 million.

With no debt, existing operating cash flow, and pre-built infrastructure at its properties, I-80's capital requirements for its next phases of growth are relatively low. The company estimates less than $50 million in total capex could grow South Arturo output by 10-15koz Au per year in the near-term. This demonstrates the potential to materially scale production with modest spending.

Ongoing work includes converting resources to reserves, completing technical studies, expanding resources through drilling, and securing remaining permits and water rights.

Valuation Compared to Peers

At a market cap of approximately $400 million, I-80 trades at a discount to both single-asset developers and diversified producers on typical valuation metrics.

For example, Sabina Gold & Silver (market cap $950 million) and Pure Gold Mining ($425 million) each only have one advanced project. Westhaven Gold, Skeena Resources, and Marathon Gold are other single-asset developers with much larger market caps than I-80. Among junior producers, Hochschild Mining, Dundee Precious Metals, and Wesdome Gold all have significantly higher valuations despite I-80's stronger growth outlook in a superior jurisdiction.

This sizable valuation disconnect presents an opportunity for investors wanting to gain exposure to high-quality assets run by a proven team in a tier-one location. The potential rerating upside is substantial as I-80 continues executing its growth plans.

Reasons for Caution

While the long-term growth prospects are certainly enticing, cautious investors should be aware of some potential risks:

• The market is currently favoring battery metals over gold, with generalist investors exiting the gold sector. This could limit access to capital in the near-term.
• The recent gold price pullback has weighed on valuations, though prices remain historically high. There is a risk of further volatility ahead.
• As a new spin-out, I-80 has a short operating track record. Execution risks exist as the team looks to simultaneously advance multiple development projects.
• The 40% interest in South Arturo provides limited current cash flow. Ramping up the other assets will take time and capex.

The Investment Thesis for i-80 Gold

I-80 Gold represents an investment opportunity for risk-averse gold investors. The combination of producing assets, advanced development projects, exploration upside and strong leadership provides both near-term cash flow and long-term growth potential.

While risks exist, the company is determined to increase output over the next several years. The current valuation relative to peers signals upside potential as investors gain confidence in the execution team and growth trajectory.

Overall, I-80 offers exposure to Nevada gold assets through a seasoned mine-building team, suggesting it merits consideration for inclusion in a cautiously positioned precious metals portfolio.

I-80 Gold is not without risk for cautious investors, even with an experienced leadership team. Here are some of the key risks to consider:

• Execution risk: As a newly spun-out company, I-80 has a limited operating track record. Simultaneously advancing multiple assets carries execution risk that could lead to delays or cost overruns.
• Gold price volatility: Gold prices have pulled back recently, though remain at historically high levels. Further volatility could impact project economics.
• Access to capital: The gold sector is currently out of favor compared to battery metals. This could limit I-80's ability to raise additional capital if needed.
• Single jurisdiction: The sole focus on Nevada, while positive from a geological perspective, concentrates on political/permitting risks versus a more diversified geographic portfolio.
• Limited cash flow: The 40% interest in South Arturo provides only ~20koz Au per year initially. Ramping up the other assets will take time and capex spending.
• Valuation disconnect: The current undervaluation suggests the market is pricing in execution risks. The share price may lag even if management executes well.

While I-80 offers potential upside potential, it does carry meaningful risks that cautious investors would need to be comfortable with. The experienced team helps mitigate some of this risk, but does not eliminate it entirely. Maintaining financial flexibility will be key.

I-80 Gold warrants careful consideration as a higher risk/higher reward portion of a diversified precious metals portfolio. The Nevada focus provides upside leverage, but concentrated risks that conservative investors would need to weigh up.