Troilus Gold Advances 13MOz Development Project Amid Strong European Backing & Rising Metal Prices

• Troilus Gold is developing a major gold and copper asset in Quebec with 13 million ounces equivalent, positioned as one of the few advanced development stories in Canada
• The company has secured $1.3 billion in letters of intent from European Export Credit Agencies and Export Development Canada, with plans to take on $700-850 million in debt
• Project economics show strong potential with $150 million US annual free cash flow at $2,000 gold, rising to $300 million US at current prices
• The company is well-capitalized with institutional backing (70% institutionally held) and is advancing detailed engineering, permitting, and team building for mine development
• Copper concentrate demand from European smelters is driving strong financial backing, with the project meeting critical minerals definitions and filling supply gaps from lost production

In a market where new mine development has been scarce and consolidation among producers dominates headlines, Troilus Gold (TSX: TLG) stands out as one of the few advanced development stories in Canada. The company is advancing a significant gold and copper project in northern Quebec that could produce between 300,000 to 500,000 ounces annually over a 22-year mine life. With strong institutional backing, advancing permitting processes, and substantial financial commitments from European export credit agencies, Troilus represents a compelling case study in bringing new critical mineral production online in a tier-one jurisdiction.

Project Economics & Development Status

The Troilus project boasts 13 million ounces equivalent in resources, positioning it as a significant development asset in the North American context. The company completed a feasibility study that demonstrated an 18% IRR at sub-$2,000 gold prices, with potential to generate over $150 million US in annual free cash flow at $2,000 gold, increasing to approximately $300 million US at current prices.CEO Justin Reid emphasizes the project's economic potential:

"At $2,000 gold, we're gonna be generating over US$150 million a year in free cash flow. At today's prices, it's closer to US$300 million in free cash flow, because all your costs are sunk in there."

Interview with President & CEO, Justin Reid

Financing Strategy & Progress

The company has secured $1.3 billion in letters of intent (LOI's) from major Export Credit Agencies (ECAs) from Germany, Finland, Sweden, and Export Development Canada. While not planning to take the full amount, Troilus believes the project can sustainably handle between $700 and $850 million in debt, maintaining a healthy debt service cover ratio of 1.9 versus typical banking covenants of 1.2.

Technical Development & Team Building

Troilus has made significant strides in building its technical team, recently bringing in Andy Frontin as operations manager and Denis Rivard for project development. The company has engaged BBA for detailed engineering, leveraging their experience with similar projects like Detour and Malartic. The project benefits from its brownfield status, with existing infrastructure providing an estimated $500 million in capital savings.

European Strategic Interest & Copper Focus

One of the most interesting aspects of the Troilus story is the strong European interest in the project, primarily driven by its copper component. Reid explains:

"It's not the gold. This is 100% based on copper. Copper's going to fund this, gold's going to drive the value."

European smelters, particularly affected by the loss of supply from major mines like Copper Panama, are actively seeking new sources of concentrate, making Troilus strategically important for European copper processing capacity.

Permitting & Environmental Progress

The company has initiated its Environmental and Social Impact Assessment (ESIA) submission process and is making progress on key environmental milestones, including the successful commencement of pit dewatering operations. Being a brownfield site with existing permits provides advantages in the permitting process, though the company acknowledges the need to carefully manage water-related aspects of the project.

Market Position & Timing

With gold prices reaching new highs and copper remaining strategic for energy transition, Troilus appears well-positioned to advance toward production. The company's institutional backing (70% institutional ownership) provides stability and potential access to additional capital as needed. The project's timing could align well with market needs, particularly in filling the growing gap in copper concentrate supply for European smelters.

The Investment Thesis for Troilus Gold

• Significant Scale and Economics: 13 million ounces equivalent resource capable of producing 300,000-500,000 ounces annually over 22 years, with potential for $150-300 million US annual free cash flow depending on gold prices. Project demonstrates robust economics even at conservative metal prices.
• Strong Financial Backing and Structure: 70% institutional ownership with $1.3 billion in letters of intent from European Export Credit Agencies, planning $700-850 million in debt. Multiple additional financing options including streams and royalties provide flexibility in capital structure.
• Strategic Copper Component: Project's copper production is attracting significant European interest and financial support due to critical concentrate shortages at major smelters, positioning Troilus as a strategic supplier in the copper market.
• De-risked Development Path: Brownfield site with $500 million in infrastructure savings, experienced technical team in place, and advancing permitting with successful initiation of key environmental processes. BBA engaged for detailed engineering with track record in similar projects.
• Jurisdictional and Currency Advantages: Quebec location provides skilled workforce and supportive mining environment, while Canadian dollar weakness enhances economics with costs in CAD and revenue in USD.
• Critical Minerals Status and Strategic Value: Project's designation as critical minerals enhances access to government support and strategic financing, while scale and location make it a potential acquisition target for majors seeking growth.
• Multiple Value Catalysts: Detailed engineering optimization, exploration upside, hedging opportunities at current gold prices, and strategic partnership potential provide multiple paths to value creation.

Troilus Gold represents a unique opportunity in the mining sector, combining the development of a significant gold-copper asset in a tier-one jurisdiction with strong financial backing from European institutions. The project's strategic importance for European copper supply, combined with its brownfield advantages and experienced team, positions it well for development. While execution risks remain, the company's systematic de-risking approach and multiple financing options provide a clear path forward. The timing appears favorable given strong gold prices and critical minerals demand, particularly for copper concentrate.

Macro Thematic Analysis

The Troilus Gold story intersects with several major macro themes in the mining sector. First, there's an acute shortage of new mine development, particularly in tier-one jurisdictions, at a time when both gold and copper prices are showing strength. The gold market is benefiting from geopolitical tensions and potential US dollar weakness, while copper remains critical for global energy transition.

The project's timing is particularly relevant given the disruption in global copper concentrate markets, with European smelters actively seeking new supply sources following the closure of major mines like Copper Panama. This supply squeeze is driving unprecedented financial support from European export credit agencies, highlighting the strategic importance of new copper production.

The Canadian angle adds another layer of interest, with currency weakness potentially enhancing project economics. As Reid notes:

"Selling our product in US dollars are costs in Canadian dollars. Right now, I want leverage to Canadian gold miners who are actually benefiting from the current economy."