Scottie Resources Secures Path to 2028 Gold Production Through Strategic Ocean Partners Alliance

• Scottie Resources is advancing a high-grade gold direct ship ore (DSO) project 40 kilometers north of Stewart, BC, targeting commercial production by mid-2028 without requiring a mill or tailings facility
• The company completed a 10,000-ton bulk sample in summer 2025 yielding 15 grams per ton gold, with 4,500 tons ready for imminent shipment that will generate net revenue by year-end
• Ocean Partners secured an 11% equity position and committed $25 million US for construction financing, alongside an offtake agreement covering the feasibility-level resource
• Project economics show an NPV of $216 million CAD at $2,600/oz gold and $670 million CAD at $4,200/oz gold with a 150% IRR in the high-case scenario, with the 18-month open pit phase generating sufficient cash flow to fund underground development
• Total capital requirements of $130 million CAD will be met through a combination of Ocean Partners' facility, traditional financing structures, and cash flow from the high-grade open pit mining 80,000 ounces at 7.7 grams per ton

Scottie Resources is positioning itself as a near-term gold producer in British Columbia's prolific Golden Triangle, leveraging a direct ship ore model that bypasses traditional milling infrastructure to accelerate project timelines and minimise capital intensity. President Thomas Mumford outlined the company's strategy during a recent discussion, emphasising the unique advantages of the project's location 40 kilometers north of Stewart, BC, adjacent to North America's northernmost ice-free deep water shipping port where established operations like Brucejack and Red Chris already export concentrates. With gold prices sustaining levels above $4,000 per ounce and structural deficits in global smelter capacity creating favourable treatment charge dynamics, Scottie's pathway to production by mid-2028 represents a compelling value proposition for investors seeking leveraged exposure to precious metals.

Project Location Advantages

The company's flagship asset sits within a 40-kilometer radius of Stewart's deep water port facility, recently acquired by the Nisga'a First Nation in partnership with the Tsimshian people and a shipping company. This infrastructure advantage eliminates the need for concentrate transportation challenges that often plague remote exploration projects. 

"Stewart has the unique feature that it's on Deep Water Shipping Port... the northernmost ice-free deep water shipping port in North America". 

The property hosts high-grade gold mineralization that outcrops at surface, enabling an open pit mining operation before transitioning underground after approximately 18 months.

The direct ship ore model represents a strategic departure from conventional mining development, targeting near-term revenue generation without the three to five hundred million dollar capital outlays and extended timelines associated with mill construction. Mumford, a geologist with a PhD and 15 years of exploration experience including a previous academic role at BCIT's mining engineering program, emphasised that "it's a simple project" leveraging existing regional infrastructure rather than attempting to justify standalone processing facilities.

Bulk Sample Execution

Scottie's summer 2025 bulk sampling program delivered tangible proof-of-concept for the DSO approach, with permitting secured in July followed by blasting operations within one week. The 10,000-ton program yielded 4,500 tons of material grading approximately 15 grams per ton gold, which has been crushed and transported to the port awaiting imminent shipment to overseas buyers. 

"We've shipped the product down to the port. It's waiting for shipment right now. It probably ships out in the next couple weeks and that'll be net revenue positive for us by the end of the year." 

This near-term revenue milestone precedes full-scale production by several years, providing both validation of metallurgical characteristics and cash flow to support ongoing development activities. The rapid progression from permit to extraction to shipment demonstrates operational capabilities while establishing relationships with logistics providers and end buyers that will be critical for commercial operations.

Offtake Partnership Details

The company formalised a comprehensive commercial relationship with Ocean Partners, a metals trading group analogous to Glencore or Trafigura that purchases concentrates for blending and resale to smelters. Ocean Partners secured an 11% equity position in Scottie while committing $25 million US toward construction financing and securing offtake rights to the resource defined at the feasibility study level. Ocean Partners CEO Brent Omland joined Scottie's board concurrent with the transaction, aligning interests between producer and offtaker.

The offtake agreement incorporates flexibility provisions including a fixed lump-sum buyout option during the first 18 months and subsequent per-ton penalties if Scottie elects to ship material to alternative buyers. 

"There's a fixed lump sum buyout that we can trigger in those first 18 months and after that it's a per ton charge and neither of them is prohibitively expensive." 

This structure preserves optionality for Scottie to renegotiate terms as the project scales or market conditions evolve, while ensuring Ocean Partners' investment is protected through reasonable commercial penalties rather than restrictive covenants.

The timing of this partnership capitalises on favourable smelter market dynamics, with structural supply deficits in China driving negative treatment charges. 

"Right now there's a structural deficit in smelters... there's not enough supply for all the smelters that China has built and therefore they're not charging high treatment charges. They're actually paying people for material right now.”

This environment enhances margins for producers shipping direct ore and concentrates, creating an opportune window for Scottie's market entry.

Interview with Thomas Mumford, President of Scottie Resources

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Economic Assessment Results

The preliminary economic assessment demonstrates robust project economics across multiple gold price scenarios, with base case assumptions at $2,600 per ounce yielding an NPV of $216 million CAD at a 5% discount rate. In a high gold price environment of $4,200 per ounce - recently exceeded in spot markets - the NPV expands to $670 million CAD with an internal rate of return reaching 150%. These metrics reflect the leverage inherent in high-grade, low-capital-intensity operations where incremental metal price appreciation flows directly to project value.

The open pit phase targets 80,000 ounces over 18 months at an average grade of 7.7 grams per ton, generating sufficient cash flow to self-fund underground development and repay initial capital expenditures. 

"The open pit pays for the entire mine payback... that pays to do all your underground workings and development. It pays back your initial capital cost". 

This rapid payback profile reduces execution risk and external financing requirements while accelerating the timeline to unencumbered cash flow generation.

The PEA also evaluated an alternative scenario involving toll processing at the nearby Premier Mill, located halfway between the mine and port. Toll milling would add approximately $150 million to project NPV by recovering additional minerals through conventional processing rather than direct shipment, though the mill's operational status remains uncertain pending restructuring efforts led by the Fiore group backed by mining entrepreneur Frank Giustra. This optionality represents potential upside beyond the base case DSO model if regional milling capacity becomes available on commercially attractive terms.

Permitting Process Timeline

Scottie initiated two-year environmental baseline studies in summer 2025, positioning the company to submit a mine permit application in 2027 through a Joint Permit Amendment Application process. This streamlined pathway leverages the property's historic mining permit, requiring modernization to current standards rather than a full environmental assessment. Using the Ascot Resources precedent, which received permits eight months post-submission for a more complex operation including mill and tailings infrastructure, Mumford projects approval by mid-2028 enabling commercial production that year.

First Nations relationships represent a critical success factor for British Columbia mining projects, where Scottie benefits from unique circumstances involving the Nisga'a Nation, BC's only treaty First Nation. The Nisga'a's recent acquisition of the Stewart port facility creates direct economic alignment with mining sector success in the region. 

"The Nisga'a, the First Nation in the area, they're the only treaty nation in BC, which is a great thing in itself, but they just bought the port that we're going to ship the facility on. They're totally aligned on that basis". 

The company is currently negotiating an Impact and Benefit Agreement (IBA) with the Nisga'a, formalising commercial terms and community commitments that will underpin social license for the project .

Funding Requirements Strategy

Total project capital requirements of $130 million CAD will be funded through a combination of Ocean Partners' $25 million US facility, traditional project financing, and cash flow from initial mining operations. The company launched a $23 million financing round with four participants, three of whom are existing shareholders, demonstrating continued insider support. The share register now includes mining entrepreneur Ross Beaty with a 5% position and Ocean Partners at 11%, providing credibility and strategic relationships.

"We need to fill that gap in the coming couple years. We could go the traditional financing route for that. Private equity, a gold prepaid, a stream royalty. I mean, we could use a lot of different structures to get that out there". 

The company plans to run a competitive process for project financing following completion of the feasibility study, evaluating debt, prepaid forward sales, streaming arrangements, and equity alternatives to optimise cost of capital and minimise shareholder dilution. Mumford emphasised that "near-term is very attractive with these gold prices to capitalise on this market right now," suggesting strong financing market receptivity for near-production gold assets.

The debt-to-equity ratio is expected to favour debt at approximately 70% of total funding, reflecting the de-risked nature of near-production projects with defined resources, secured offtake, and clear permitting pathways. This capital structure would preserve equity upside for existing shareholders while leveraging institutional debt capacity attracted to senior secured positions in precious metals projects.

Exploration Resource Potential

While near-term production remains the primary focus, Scottie maintains an active exploration program targeting resource expansion from the current 700,000 ounces to over 2 million ounces. A planned 10,000-meter drilling campaign in 2026 will test step-out targets around known mineralization, with the goal of extending mine life and increasing annual production rates once initial operations are established. 

"We want to raise a little bit extra money and drill it... we have a plan for about a 10,000 meter program this year to do exploration." 

This dual-track approach balances near-term execution risk against longer-term value creation, acknowledging that 

"we've explored for many years, we're having fantastic success... but it was that transition to near-term producer that has caused a lot more interest in us". 

The company recognises that production visibility drives institutional investor interest while exploration success provides organic growth opportunities without acquisition premiums. Budget allocation will prioritise permitting and engineering studies required for 2028 production, with exploration programs sized to avoid diluting capital away from development milestones.

Market Positioning Outlook

Scottie's transition from explorer to near-term producer positions the company within a cohort of approximately 18 junior miners pursuing DSO and near-term revenue models, representing a strategic shift in how junior gold companies approach project development. This model addresses historical challenges where exploration success failed to translate into shareholder value due to prohibitive development capital requirements, extended permitting timelines, and market skepticism regarding execution capabilities.

"We are now fully financed for another year of full studies. We're going from PEA into feasibility... this is a place in the market that you want to be with gold at $4,000 and if it's going to go to 5,000, absolutely this is the kind of space you want to be in." 

With gold prices sustaining historically elevated levels, negative smelter treatment charges improving margins, and institutional capital seeking production-stage assets, Scottie's fully-funded pathway to 2028 production offers investors leveraged exposure to precious metals through a development-stage vehicle with significant milestones approaching.

The Investment Thesis for Scottie Resources

• De-risked Development Model: Direct ship ore approach eliminates $300-500 million mill construction capital and associated permitting complexity, reducing execution risk and accelerating production timeline to mid-2028
• Funded to Feasibility: Combination of Ocean Partners' $25 million US facility, recent $23 million financing, and bulk sample revenue provides runway through feasibility study completion and mine permit submission in 2027
• Strategic Offtake Partnership: Ocean Partners' 11% equity position and board seat aligns commercial interests while securing market access during favorable smelter dynamics with negative treatment charges enhancing margins
• Exceptional Project Economics: NPV of $216 million CAD at $2,600/oz gold expanding to $670 million CAD at $4,200/oz with 150% IRR demonstrates significant leverage to sustained elevated gold prices
• Self-Funding Production Profile: High-grade open pit phase (7.7 g/t, 80,000 oz over 18 months) generates sufficient cash flow to fund underground development and repay initial capital, minimising equity dilution during construction
• Blue-Sky Exploration Potential: Current 700,000-ounce resource with clear pathway to 2+ million ounces through systematic exploration provides organic growth optionality beyond initial mine plan
• Infrastructure and Social License Advantages: Direct road access to deep water port facility owned by treaty First Nation partner eliminates logistics challenges while securing strong community alignment through commercial interest convergence
• Institutional-Quality Share Register: Ross Beaty (5%), Ocean Partners (11%), and concentrated existing shareholder support demonstrates sophisticated investor validation and reduces overhang risk
• Favorable Permitting Environment: Joint Permit Amendment Application process leveraging historic mine permit avoids full environmental assessment, with 8-month approval precedent (Ascot) supporting mid-2028 production timeline
• Multiple Financing Pathways: Project scale and production profile accommodates traditional debt, streaming, prepaid gold sales, or private equity structures at favorable 70/30 debt-to-equity ratios, providing capital flexibility

Macro Thematic Analysis

The convergence of sustained $4,000+ gold prices, structural smelter capacity deficits creating negative treatment charges, and investor skepticism toward capital-intensive mill construction has catalysed a fundamental shift in junior gold development strategies. Scottie Resources exemplifies this evolution, where high-grade deposits adjacent to existing infrastructure can bypass traditional processing facilities to achieve near-term production at a fraction of conventional capital requirements. With approximately 18 companies pursuing similar DSO models, the sector is witnessing a departure from the explore-promote-stall cycle that characterised prior market cycles, instead prioritising cash flow generation and shareholder returns over resource tonnage maximization . This structural change addresses institutional capital's demand for de-risked, near-production assets while leveraging favourable metallurgical markets where Chinese smelters actively compete for direct ore supply. 

TL;DR

Scottie Resources is advancing a high-grade gold DSO project in BC's Golden Triangle toward mid-2028 production, backed by Ocean Partners' $25 million US funding commitment and 11% equity stake securing offtake. Project economics show $670 million CAD NPV at $4,200/oz gold with 150% IRR, while the initial 18-month open pit phase generates sufficient cash flow to self-fund underground development of the 700,000-ounce resource. The company is fully funded through feasibility completion, with streamlined permitting via Joint Permit Amendment Application and strong First Nations alignment through the Nisga'a Nation's ownership of the shipping port facility.

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