i-80 Gold's Phased Growth Strategy & the Path to Multi-Asset Margin Expansion in Nevada

• i-80 Gold's phased growth strategy prioritizes sequencing and capital discipline, rather than rapid scale, to unlock value across multiple Nevada assets.
• Control of the Lone Tree autoclave is expected to materially change payability, cost structure, and long-term margin capture for refractory ore.
• Near-term execution is focused on Phase 1 de-risking, with clear milestones tied to feasibility studies, permitting, and financing targeted through 2026–2027.
• The company's asset base combines high-grade underground optionality with large open-pit scale, supporting a multi-decade production profile.
• For investors, the key question is timing and execution risk, not geological uncertainty, placing emphasis on funding structure, permitting cadence, and operational delivery through 2026-2028.

Why Phased Growth Has Re-emerged as a Core Mining Investment Theme

The post-2012 mining cycle fundamentally reshaped how institutional capital evaluates development-stage producers. Single-asset, high-capex builds left investors with impaired returns, cost overruns, and structural dilution. The industry response has been a marked shift toward modular growth paths that preserve balance sheet flexibility and align capital deployment with commodity cycles.

Phased development reduces exposure to single-asset execution failure while allowing companies to validate technical assumptions at smaller scale before committing to full build-outs. Investors now favor companies that demonstrate disciplined capital allocation, stage-gated execution, and the ability to generate cash flow before large-scale expansion.

The current environment, characterized by elevated gold prices, tighter credit markets, and heightened scrutiny on return on invested capital, has reinforced this preference. Companies that can demonstrate margin expansion through operational control, rather than volume growth alone, are increasingly commanding valuation premiums.

Nevada's Role in Supporting Staged Development Models

Nevada's combination of permitting transparency, established infrastructure, and technical workforce density materially shortens development timelines relative to frontier jurisdictions. The state's regulatory framework allows for incremental permitting aligned with phased development, reducing upfront capital intensity and timeline risk.

Brownfield advantages, including existing roads, power infrastructure, water rights, and processing facilities, allow companies to layer production phases rather than commit to greenfield builds. This infrastructure density is particularly relevant for developers managing multiple assets across a district, where shared facilities and centralized processing can materially improve unit economics.

Richard Young, Chief Executive Officer of i-80 Gold, frames Nevada's competitive advantage:

"That's one of the things that makes Nevada one of the best places globally to operate. Not just the geology but the quality of the workforce."

i-80 Gold as a Case Study in Phased, Infrastructure-Led Growth

The strategic decision to refurbish the company-owned Lone Tree autoclave represents a fundamental shift in i-80 Gold's growth logic. Rather than building multiple standalone processing facilities or relying indefinitely on third-party toll milling, the company has centralized capital intensity around processing control. This structure prioritizes margin expansion before volume expansion.

The Lone Tree autoclave, once refurbished, is designed to serve as the processing hub for refractory ore from multiple assets including Granite Creek Underground and Cove. This configuration reduces the need for duplicative processing infrastructure and allows the company to capture margins currently embedded in third-party toll milling arrangements.

The "Hub and Spoke" Model in Economic Terms

Refractory ore economics are often constrained by third-party toll milling arrangements, where payability typically ranges between 55 percent and 60 percent. Owner-operated autoclave processing is expected to lift recovery rates toward 90 percent or higher, materially impacting all-in sustaining costs and earnings before interest, taxes, depreciation, and amortization margins.

For i-80 Gold, which currently processes Granite Creek refractory material through a third-party arrangement at 55 to 60 percent payability, the toll milling structure represents a cost burden that limits free cash flow generation. Eliminating this arrangement through autoclave refurbishment is designed to directly address the company's near-term cost structure.

Richard Young quantifies the current cost impact and the timeline for transition:

"Right now the toll milling is costing us between $1,000 and $1,500 an ounce... We expect to pour gold through our own autoclave before the end of 2027... Strategically and economically that refurbishment is very important for us to move forward with."

Phase 1 Execution: De-Risking Before Scale

Phase 1 is focused on technical validation, permitting alignment, and cost certainty across three primary assets: Granite Creek Underground, Cove, and Archimedes at Ruby Hill. The objective is to establish operational reliability, refine cost models, and de-risk feasibility assumptions before committing to larger-scale capital deployment in subsequent phases.

This approach reflects management's recognition that geological risk has been substantially mitigated through historical drilling and recent infill programs. The focus has shifted to execution risk, refurbishment timelines, dewatering infrastructure, workforce ramp-up, and permitting cadence.

The company is currently producing from Granite Creek Underground and heap leach operations at Lone Tree and Ruby Hill, targeting 30,000 to 40,000 ounces in 2025. Richard Young describes the company's three-phase roadmap:

"We announced 12 months ago a three-phase development plan that would take production from less than 50,000 ounces of gold per year to over 600,000 ounces of gold production annually... By 2028 we expect to produce about 200,000 ounces per year and generate EBITDA somewhere between $200 and $300 million depending on the price of gold."

Under the formalized development plan, Phase 1 targets average annual production of 150,000 to 200,000 ounces during the 2028-2029 period.

Technical Risk Versus Execution Risk

Management has consistently stated that geology is well understood across the company's core assets. The current focus is operational reliability, specifically, the ability to maintain consistent underground mining rates, manage dewatering infrastructure, and transition smoothly from toll milling to autoclave processing.

At Granite Creek, dewatering infrastructure upgrades completed in early 2025 addressed historical water management challenges that constrained development at depth. Development of the underground exploration drift commenced in Q3 2025.

Richard Young details the operational progress:

"During the third quarter we installed a permanent dewatering system that is able to remove the water to surface. Now over the next 6 months, we'll be building the necessary infrastructure. The water issue will no longer be a challenge. The reason why that's so important is it hampered our ability to develop the ore body at depth. At depth, grades get better, ground conditions get better, and we expect mining rates to rise."

Cost Structure, Margin Leverage & Payability as the Real Re-Rating Driver

Processing costs and payability directly influence all-in sustaining costs and free cash flow generation. Lone Tree ownership is designed to eliminate third-party margins embedded in toll milling, which currently represent a material cost burden on refractory ore production. The planned shift from toll milling to owner-operated autoclave processing is expected to fundamentally improve the margin structure of the business.

For investors evaluating i-80 Gold's valuation relative to peers, processing control is the primary re-rating driver. While grade improvements and resource expansion provide upside optionality, the immediate margin impact is expected to come from eliminating toll milling costs and improving recovery rates.

Margin Sensitivity to Gold Price and Recovery Rates

Recovery uplift has a non-linear effect on project economics relative to grade alone, improving recovery from 60 percent to 90 percent effectively increases the economic grade of the ore body by 50 percent without requiring additional drilling or mining. This relationship between recovery rates and project economics explains why autoclave control matters more than incremental grade improvements for near-term margin expansion.

Richard Young reinforces the strategic importance of processing control:

"The important element with these two underground mines is to pivot from toll milling which we currently do for that material to refurbishing our own autoclave so that we run it through and take the margin."

Capital Strategy: Financing Growth Without Structural Dilution

The equity raise completed in Q2 2025 provided US$174 million net proceeds, with approximately $92 million allocated to growth capital including drilling programs, feasibility studies, and early-stage infrastructure work over the following 12 months. Larger capital expenditures, including autoclave refurbishment, are being financed through a broader recapitalization strategy that includes a new senior debt facility.

The company settled gold and silver prepayment obligations with National Bank and Orion Mine Finance as part of the 2025 recapitalization, improving balance sheet flexibility. The company is targeting a new senior debt facility in mid-2026, with a funding target of $350 million to $400 million to support Phase 1 and Phase 2 development.

Richard Young outlines the funding roadmap:

"The equity raise that we completed in the second quarter basically provides about $92 million towards our development plan. We're fully funded to be able to move the development plan forward. By the end of Q2 of next year we expect to have completed the recapitalization plan that will then fund both phase one and phase two of our development plan."

Strategic Portfolio Optimization as a Funding Lever

Management has indicated it is seeking to expand the recapitalization to accelerate technical work at Mineral Point, targeting completion of a prefeasibility or feasibility study in the first half of 2027.

Timeline Risk, Permitting Windows & Investor Expectations

The company has outlined several near-term milestones that will serve as execution checkpoints for investors. These include completion of the Lone Tree autoclave refurbishment engineering study targeted for late 2025, updated resource estimates and feasibility studies for Granite Creek Underground and Cove Underground targeted for early 2026, and a feasibility study for Archimedes Underground targeted for early 2027.

Richard Young confirms the feasibility timeline:

"Between the first quarter of 2026 and the first quarter of 2027 we'll have three feasibility studies out."

The autoclave refurbishment is expected to be a two-year process targeting completion by the end of 2027. The company is targeting finalization of its senior debt facility in mid-2026, subject to final negotiations and market conditions.

At Cove, the company completed a 144,000-foot infill drill program in Q3 2025. Richard Young notes the resource expansion:

"In Q3 we completed the infill drill program for the cove underground... The total mineralized envelope is up between 10 and 20%."

Where Delays Matter and Where They Do Not

Short delays in study completion or permitting timelines carry different valuation impacts than delays in financing or construction. Market reactions tend to reflect expectation gaps rather than absolute timelines. For i-80 Gold, the most material risks are tied to financing completion and autoclave refurbishment timelines. Study delays of several months are less significant than cost overruns or permitting rejection.

Investors should distinguish between delays that signal technical or permitting challenges versus delays that reflect normal variability in study completion or contractor availability.

The Investment Thesis for i-80 Gold

• Phased growth strategies reduce capital risk while preserving upside optionality, allowing companies to validate technical assumptions before committing to full-scale builds.
• Control of critical infrastructure, including autoclaves and processing facilities, is expected to structurally improve margins and payability relative to third-party toll milling arrangements.
• Nevada jurisdiction lowers geopolitical and permitting risk relative to global peers, providing regulatory transparency and infrastructure density that can shorten development timelines.
• Sequenced execution allows valuation re-rating at multiple inflection points, not just first production, providing investors with incremental catalysts across the development cycle.
• For disciplined investors, timing entry around execution milestones may matter more than spot gold price, particularly when margin expansion is driven by processing control rather than commodity price leverage alone.
• Asset portfolios combining high-grade underground optionality with large open-pit scale support multi-decade production profiles, reducing single-asset execution risk.
• Development timelines aligned with multi-year demand growth trends position companies to capture margin expansion as production scales during favorable commodity environments.

Phased Execution, Not Scale, Defines the Opportunity

i-80 Gold's phased growth strategy reframes how investors should assess emerging Nevada producers. Rather than viewing the story through a single production milestone, the company's value proposition is built around sequenced execution, infrastructure control, and margin expansion over time. For institutional and sophisticated retail investors, the key is not whether i-80 can become a large producer, but how efficiently and predictably it can get there. In a market increasingly focused on capital discipline and delivery credibility, phased growth is no longer a constraint. It is the strategy.

TL;DR

i-80 Gold is executing a phased development strategy across multiple Nevada assets, prioritizing processing control over rapid volume expansion. The company's refurbishment of its Lone Tree autoclave is designed to eliminate costly third-party toll milling arrangements, which currently cost $1,000–$1,500 per ounce at 55–60% payability. Owner-operated processing is expected to lift recovery rates toward 90%, fundamentally improving margins. Phase 1 targets 150,000–200,000 ounces annually by 2028–2029, with three feasibility studies due between Q1 2026 and Q1 2027. The company is targeting a $350–$400 million senior debt facility in mid-2026 to fund Phase 1 and Phase 2 development.

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