Revival Gold - Unlocking Two Advanced-Stage Gold Projects in the Western United States

• Revival Gold is advancing two gold projects: Beartrack-Arnett in Idaho and Mercur in Utah, with a combined resource of 6.2 million ounces of gold.
• The company aims to develop both projects into production, targeting over 150,000 ounces of annual gold production from heap leach operations.
• Mercur was recently acquired and offers advantages like being on private land for simpler permitting and potential for faster development.
• Beartrack-Arnett has existing infrastructure that can be redeployed, requiring modest capital of just over $100 million to restart production.
• The company is working on a Preliminary Economic Assessment for Mercur by Q1 2025 and advancing permitting for Beartrack-Arnett, while also pursuing exploration upside at both projects.

In a time of rising gold prices and increasing scarcity of quality gold deposits, Revival Gold (TSX-V: RVG, OTCQX: RVLGF) is positioning itself as an attractive investment opportunity in the gold mining sector. The company is advancing two significant gold projects in mining-friendly jurisdictions of the Western United States: the Beartrack-Arnett project in Idaho and the recently acquired Mercur project in Utah. With a combined resource base of 6.2 million ounces of gold and a clear path towards production, Revival Gold offers investors exposure to a growing gold development story with substantial exploration upside.

Revival Gold's Projects and Development Strategy

Beartrack-Arnett Project

The Beartrack-Arnett project is Revival Gold's flagship asset, located in Lemhi County, Idaho. This brownfield site benefits from existing infrastructure and a history of past production, which significantly de-risks the project and reduces capital requirements for future development.

Hugh Agro, President and CEO of Revival Gold, highlights the advantages of working with previously mined sites:

"We're pursuing assets in locations that have been successfully mined before. That means we have infrastructure, capital savings, community support, and importantly, understanding of the rocks and how they perform, which will allow us to move forward on a less risky basis."

The project currently envisions an open-pit, heap leach operation producing approximately 63,000 ounces of gold annually over an 8-year mine life. While this may seem modest compared to some larger-scale projects in the industry, it's important to note the significant advantages this approach offers:

1. Low initial capital requirement: The project requires just over $100 million to restart production, leveraging existing infrastructure.
2. Quick path to production: With much of the necessary infrastructure already in place, the timeline to first gold pour could be significantly shorter than greenfield projects.
3. Strong economics: The project boasts a 24% after-tax return at a conservative $1,800 gold price assumption.
4. Exploration upside: The deposit remains open along strike and at depth, offering substantial potential for resource expansion.

Mercur Project

In a strategic move to diversify its portfolio and accelerate its path to production, Revival Gold recently acquired the Mercur project in Utah for $22 million. This acquisition brings several key advantages to the company:

1. Scale: The addition of Mercur's 1.6 million ounce resource increases Revival's total resource base to 6.2 million ounces, enhancing the company's overall scale and attractiveness to investors.
2. Simplified permitting: Unlike Beartrack-Arnett, which is on federal land, Mercur is primarily on private land. This distinction significantly simplifies the permitting process, potentially allowing for faster development.
3. Heap leach potential: Mercur's characteristics make it amenable to heap leach processing, aligning with Revival's expertise and operational strategy.
4. Location: Situated just 45 minutes from Salt Lake City, Mercur benefits from excellent infrastructure and access to a skilled workforce.

Agro explains the strategic rationale behind the Mercur acquisition:

"The Mercur addition for us is hugely strategic because it diversifies our portfolio, it brings us more heap leach potential around our production scenario, and it builds our scale. Our target production from these two projects is now over 150,000 ounces per year."

Interview with President & CEO Hugh Agro

Development Timeline and Milestones

Revival Gold is advancing both projects on parallel tracks, with key near-term catalysts that investors should watch for:

1. Mercur Preliminary Economic Assessment (PEA): Expected by the end of Q1 2025, this study will provide initial economic parameters for the project and help investors better understand its potential.
2. Beartrack-Arnett permitting: The company is advancing permitting preparations for the heap leach project at Beartrack-Arnett.
3. Exploration: Ongoing geological modeling and exploration work at both projects aim to expand the resource base and improve project economics.

While specific timelines for production decisions haven't been disclosed, Agro suggests that Mercur could potentially move faster than Beartrack-Arnett due to its location on private land. He estimates that permitting for Mercur could be completed in about three years, though there may be opportunities to improve on this timeline.

Market Dynamics and Strategic Positioning

The gold mining industry is currently experiencing a wave of consolidation, driven by the need for major producers to replenish their reserves. Recent examples include AngloGold's bid for Centamin and Newmont's acquisition of Newcrest. This trend underscores the scarcity of quality gold deposits and the increasing value of projects like those held by Revival Gold.

Agro puts this into perspective: "These projects are scarce and in good locations, they're very valuable and they're becoming more precious. The rate of discovery running at about 10 to 20 million ounces a year is not enough."

This dynamic positions Revival Gold as an attractive potential acquisition target for larger gold producers. However, the company's management is focused on building value for shareholders rather than simply putting itself up for sale. Agro emphasizes the importance of advancing all aspects of the projects, including permitting, metallurgy, construction planning, community relations, and exploration, to maximize value for shareholders.

Financial Position and Capital Strategy

Revival Gold recently completed a strategic restructuring of its financial obligations related to the Beartrack-Arnett project. The company converted a $27 million cash payment obligation into a 0.3% Net Smelter Return (NSR) royalty. This move significantly reduces the near-term capital burden on the company and aligns the payment structure with future production.

Agro explains the benefits of this restructuring:

"We've taken the burden of that cash payment away from the project. I think it's a win-win arrangement for our partner and ourselves. It incentivizes Revival Gold to continue to progress the story and build out the exploration potential without the burden of a cash payment in a tough capital market."

The company is actively engaged in discussions with potential strategic and financial partners to fund the advancement of its projects. These discussions include major mining companies as well as sophisticated institutional funds exploring creative financing structures.

Valuation and Investment Opportunity

Despite its significant resource base and advancing development plans, Revival Gold currently trades at a valuation of approximately $7 per ounce of gold in the ground. This valuation appears conservative when considering the company's projects are located in tier-one mining jurisdictions, benefit from existing infrastructure, and are advancing towards production.

The current market capitalization of around $40 million suggests there may be significant upside potential as the company achieves key development milestones and the market begins to recognize the full value of its assets.

Conclusion

Revival Gold presents a compelling investment opportunity in the gold mining sector. With two advanced-stage projects in mining-friendly jurisdictions, a clear path to production, and significant exploration upside, the company is well-positioned to benefit from rising gold prices and increasing interest in quality gold deposits.

As Revival Gold continues to advance its projects and achieve key milestones, investors have an opportunity to gain exposure to a growing gold development story with the potential for significant value appreciation.

The Investment Thesis for Revival Gold

• Large resource base: 6.2 million ounces of gold across two projects provides a solid foundation for growth.
• Advanced-stage projects: Both Beartrack-Arnett and Mercur are past-producing sites, reducing development risk.
• Heap leach focus: Both projects have heap leach potential, allowing for lower capital intensity and faster time to production.
• Excellent jurisdictions: Idaho and Utah are mining-friendly states with good infrastructure and skilled labor.
• Experienced management: Team has a track record in larger mining organizations, understanding what makes projects attractive to major producers.
• Clear path to production: Targeting over 150,000 ounces of annual production from both projects combined.
• Strong economics: Beartrack-Arnett shows a 24% after-tax return at $1,800 gold, with potential for improvement at current gold prices.
• Exploration upside: Both projects have potential for resource expansion through ongoing exploration.
• Strategic acquisition potential: In a consolidating gold sector, Revival's projects could be attractive to larger producers looking to replenish reserves.
• Conservative valuation: Trading at approximately $7 per ounce in the ground, suggesting potential for significant re-rating as development progresses.

Actionable advice for investors:

• Consider establishing a position in Revival Gold as a way to gain exposure to advanced-stage gold development projects in tier-one jurisdictions.
• Watch for the release of the Mercur PEA in Q1 2025 as a key catalyst that could drive re-rating of the stock.
• Monitor progress on permitting at Beartrack-Arnett as another important milestone.
• Pay attention to exploration results from both projects, as resource expansion could significantly enhance project economics and company valuation.
• Keep an eye on the broader gold market and M&A activity in the sector, as rising gold prices and continued consolidation could increase Revival Gold's attractiveness as an acquisition target.

Key Takeaway

Revival Gold represents an attractive investment opportunity in the gold mining sector, offering exposure to two advanced-stage projects in excellent jurisdictions. With a clear focus on advancing towards production, significant exploration upside, and a conservative current valuation, the company is well-positioned to benefit from rising gold prices and increasing interest in quality gold deposits. As Revival Gold continues to achieve key milestones in the development of its projects, investors have the potential to realize substantial value appreciation. However, as with all mining investments, risks remain, including potential delays in permitting or development, fluctuations in gold prices, and the need for additional capital to fund development. Investors should carefully consider these factors alongside the compelling opportunity presented by Revival Gold's assets and strategy.

Macro Thematic Analysis

The gold mining industry is currently experiencing a confluence of factors that create a favorable environment for companies like Revival Gold. These factors include:

1. Rising gold prices: Gold has recently surpassed $2,500 per ounce, driven by global economic uncertainties, geopolitical tensions, and expectations of potential interest rate cuts.
2. Reserve depletion: Major gold producers are struggling to replace their reserves through exploration, leading to increased M&A activity in the sector.
3. Scarcity of quality deposits: New, large-scale gold discoveries are becoming increasingly rare, especially in stable jurisdictions.
4. Focus on jurisdictional risk: Mining companies are prioritizing projects in stable, mining-friendly regions like North America.
5. ESG considerations: There's growing emphasis on responsible mining practices and community engagement, favoring projects with strong ESG credentials.
6. Capital discipline: Investors are rewarding companies that demonstrate prudent capital allocation and clear paths to production.

These macro trends are creating opportunities for mid-tier developers like Revival Gold, which offer a combination of significant resource base, clear development path, and projects in favorable jurisdictions. Hugh Agro succinctly captures the essence of this opportunity:

"In a world where gold deposits of scale are becoming more and more scarce, these are precious assets."

This statement underscores the increasing value of Revival Gold's projects in a market where quality gold deposits are becoming harder to find. As major producers continue to seek ways to replenish their reserves and maintain production levels, companies like Revival Gold, with advanced-stage projects in tier-one jurisdictions, are likely to attract increasing attention from both investors and potential acquirers.