One of Two: Why Osisko Development’s Fully Permitted Gold Mine is a Unicorn in Canada

• Osisko Development Corporation has secured construction permits for a 5,000 ton per day gold mine in British Columbia that will produce 200,000 ounces annually, representing one of only two fully permitted gold mines in Canada with a $650 million US capex compared to competitors requiring $6.5 billion. Production expected in 2027.
• The Cariboo Gold project contains 2 million ounces in reserves at 3.8 grams per ton, with an additional 1.6 million ounces measured and indicated plus 1.8 million ounces inferred, spanning a 4.4 kilometer strike length within a 50 kilometer mineralized trend that Osisko controls entirely.
• The project offers exceptional economics with production costs of $1,157 per ounce, generating potential free cash flow of $457 million annually at current gold prices and supported by low-cost hydroelectric power.
• Osisko Development received permits in under five years versus the industry average of 14 years, benefiting from strong government support and successful First Nations partnerships, with construction already underway including 1,200 meters of underground development completed.
• The company operates with a C$375 million (USD$281 million) market cap and plans to announce project financing within two months, with significant backing from a 24% shareholder and another cornerstone investor holding 9.9%, positioning for potential M&A activity as major mining companies actively seek acquisition targets.

As gold reaches new heights and governments recognize its strategic importance, Osisko Development emerges as a compelling investment opportunity in the Canadian mining sector. With one of only two fully permitted gold mines in Canada and a proven management team led by Sean Roosen, the company represents a rare combination of advanced development, favourable economics, and significant scaling potential in a market increasingly hungry for quality gold assets.

A Rare Permitted Asset in a Constrained Market

The Cariboo Gold project in British Columbia stands out in an environment where permitting has become increasingly challenging. While the industry average for obtaining mining permits stretches to 14 years, Osisko Development secured its construction permits in 4 years and 10 months, a testament to both management expertise and strategic stakeholder engagement.

The project received strong government support, with the newly elected BC NDP government making the Cariboo Gold permit approval their first official act, signaling continued political backing for the development. This permit advantage becomes even more significant when considering the broader Canadian landscape.

With only two permitted gold mines in the country ready for construction, Osisko Development joins an exclusive club that includes Seabridge Gold's massive but capital-intensive project requiring over $6 billion in capex. In contrast, the Cariboo Gold project requires just $650 million US, making it far more accessible and financeable.

Interview with Founder & CEO Sean Roosen

Exceptional Resource Base and Economics

The Cariboo Gold project boasts impressive fundamentals that distinguish it from typical development-stage assets. The deposit contains 2 million ounces in the reserve category at 3.8 grams per ton, supported by an additional 1.6 million ounces in measured and indicated categories and 1.8 million ounces inferred. This resource base spans a 4.4 kilometer strike length within a much larger 50 kilometer mineralized trend that Osisko controls entirely.

The project's grade profile compares favourably to established Canadian operations. At 3.8 grams per ton, Cariboo Gold exceeds the grades of comparable bulk tonnage underground operations like Alamos' Young-Davidson at 2.2 grams and Agnico's Goldex at 1.52 grams. This higher grade translates directly into superior economics and cash flow generation potential.

Production economics appear robust across multiple gold price scenarios. The project targets production costs of $1,157 per ounce, generating substantial margins at current gold prices exceeding $3,300. At these levels, the operation would generate approximately $457 million in annual free cash flow, providing significant financial flexibility for debt service, expansion, and shareholder returns.

Strategic Infrastructure and Operational Advantages

Location advantages provide Osisko Development with operational benefits that reduce both capital and operating costs. The project sits on paved roads with grid power access from BC Hydro, eliminating the remote location challenges that plague many mining developments. Hydroelectric power availability at 5 cents US per kilowatt hour provides a significant cost advantage in an energy-intensive industry.

The company has already invested $700 million in the project and completed over 700,000 meters of drilling, demonstrating the thoroughness of its development approach. Construction activities are underway, with 1,200 meters of underground development completed and critical equipment already secured, including the comminution circuit and mill purchased from HudBay.

Roosen emphasized the advanced stage of development that reduces execution risk for investors:

"We're underground, already mining. We've got about 1,200 meters of underground development into it. So we're in construction as we speak."

Proven Management Track Record

Sean Roosen brings exceptional credibility to Osisko Development through his track record of building and monetizing major mining assets. His previous success with Canadian Malartic, which became Canada's largest gold mine and the ninth largest globally, demonstrates his ability to execute large-scale mining projects successfully.

The Canadian Malartic experience proved particularly relevant for current investors. After building the operation, Osisko faced a hostile takeover in 2014 from GoldCorp but ultimately sold the asset for $4.1 billion to a JV comprising Agnico Eagle and Yamana Gold,and creating Osisko Gold Royalties in the process. That royalty company now commands a market capitalization exceeding $6 billion, while the original mine represents approximately $22 billion of Agnico Eagle's current valuation.

This track record extends beyond a single asset. Under Roosen's leadership, the Osisko platform created and monetized Osisko Mining, sold to Gold Fields for $2.16 billion, while developing Osisko Metals with its billion-ton Gaspé Copper deposit. This consistent value creation across multiple assets and commodities demonstrates management's ability to identify, develop, and monetize world-class mineral resources.

Scaling Potential and Long-Term Value

The Cariboo Gold project offers significant expansion potential that could transform it from a mid-tier producer into a major mining operation. Initial production plans target 200,000 ounces annually from a 5,000 ton per day operation, but the deposit's size and grade support much larger throughput rates.

Management envisions scaling production through multiple phases, potentially reaching 15,000 tons per day processing rates that could support 500,000 ounces of annual production. This scaling potential reflects the deposit's exceptional size, with Roosen comparing it to established mining camps noting:

"You could put all three of those mines [Young Davidson, Goldex, and LaRonde] in the footprint of this deposit and still have room for one more Young Davidson."

The 50 kilometer mineralized trend provides additional long-term upside through exploration success. Converting even a portion of the 3.4 million ounces in measured, indicated, and inferred categories would significantly extend mine life and production rates, creating substantial additional value for shareholders.

Market Position and M&A Potential

Osisko Development operates in an increasingly favourable M&A environment where major mining companies actively seek quality development assets. The company's $375 million market capitalization appears modest relative to the project's fundamentals and development stage, particularly when compared to recent transactions in the sector.

The company benefits from strong strategic shareholder support, with one investor holding 24% and another cornerstone shareholder owning 9.9%. These significant positions provide stability while ensuring alignment with shareholder value creation. The concentrated ownership structure could facilitate strategic transactions while protecting minority shareholder interests. As Roosen observed:

"If I look at all the top 10 M&A ideas that come out, ODV is always on the list."

Industry consolidation trends favor assets like Cariboo Gold that offer significant production potential with manageable capital requirements. This reflects the asset's recognition within the investment community as an attractive acquisition target.

The Investment Thesis for Osisko Development Corporation

The company's financial position supports its development timeline, with recent equity raises providing sufficient capital to advance construction activities. Management expects to announce project financing within the next two months, which should significantly de-risk the investment thesis and potentially provide a catalyst for share price appreciation.

• Acquire a rare permitted asset: With only two fully permitted gold mines in Canada, Osisko Development offers exposure to a scarce asset class with significant barriers to entry for competitors.
• Capitalize on proven management execution: Sean Roosen's track record of building and monetizing billion-dollar mining assets provides confidence in successful project development and value realization.
• Target superior project economics: Production costs of $1,157 per ounce generate substantial margins at current gold prices, with potential free cash flow of $457 million annually supporting strong shareholder returns.
• Position for scaling potential: Initial 200,000 ounce production could expand to 500,000 ounces through phased development, transforming the company into a major gold producer.
• Benefit from M&A optionality: The asset's recognition as a top acquisition target provides downside protection while offering potential premium realization in strategic transactions.
• Leverage infrastructure advantages: Grid power access and paved road connectivity reduce both capital and operating costs compared to remote mining developments.
• Await project financing catalyst: The expected financing announcement within two months should reduce development risk and potentially trigger share price appreciation.

The combination of advanced development stage, exceptional resource quality, proven management, and favorable market dynamics positions Osisko Development as a compelling investment opportunity for investors seeking leveraged exposure to gold price appreciation through a quality development asset. The company's unique position as one of only two permitted gold mines in Canada, combined with its superior economics and scaling potential, creates multiple pathways for significant shareholder value creation over the coming years.

Macro Thematic Analysis: Gold's Strategic Renaissance

The gold sector benefits from unprecedented macro tailwinds as governments worldwide recognize the metal's strategic importance in an era of currency debasement and geopolitical uncertainty. Central bank gold purchases reached record levels in recent years, while the US designation of gold as a strategic metal reflects growing awareness of its role in financial security. These institutional dynamics support sustained higher gold prices that benefit quality producers like Osisko Development.

Trade tensions and tariff policies further enhance gold's appeal, particularly for Canadian producers. As Sean Roosen noted:

"The good news about resources in Canada is you can't move them across the border. No matter how many tariffs you put on it, it's not moving."

This geographic advantage insulates Canadian gold producers from trade disruptions while benefiting from safe-haven demand during periods of economic uncertainty.

The supply-demand fundamentals for gold remain constructive, with limited new mine development due to permitting challenges and declining ore grades at existing operations. This supply constraint supports higher prices while creating premium valuations for rare permitted development assets. Environmental and social governance requirements have raised development costs and timelines industry-wide, making projects like Cariboo Gold with established permits increasingly valuable.

"The US has named gold as a strategic metal now because they see it as vital to their financial security."

Energy transition demands create additional gold demand through electronic applications, while inflation concerns drive investor interest in precious metals as portfolio hedges. The combination of restricted supply, growing industrial demand, and continued monetary debasement creates a favorable long-term outlook for gold prices that benefits leveraged producers with quality assets and strong operational capabilities.

Key Takeaways

Osisko Development represents a unique opportunity to invest in one of Canada's only two fully permitted gold mines through a management team with a proven track record of building and monetizing world-class mining assets. The Cariboo Gold project offers exceptional economics, significant scaling potential, and strategic advantages that position it favorably in an increasingly challenging development environment.

With project financing expected within two months and strong M&A interest in quality development assets, the company provides multiple catalysts for value creation while offering leveraged exposure to gold's strategic renaissance in global financial markets.