Troilus Gold (TLG) - Quebec Govt Investing Equity & Project Finance

Troilus Gold is a Canadian-based junior mining company that is focused on the systematic advancement and de-risking of the Troilus Project towards production. The Troilus project is quickly becoming a top-ranked gold and copper producing asset in Canada. 

We met with Justin Reid, President, CEO, and Director, Troilus Gold. Justin is a geologist and a capital market executive with over two decades of experience in the mineral resource space.  He previously served as the President and Director at Sulliden Gold Corporation. His educational credentials include a B.Sc from the University of Regina, an M.Sc from the University of Toronto, and an MBA from the Kellogg School of Management at Northwestern University. 

Company Overview

Troilus Gold is an advanced stage exploration and early-development company focused on the mineral expansion and restart of the former gold and copper Troilus mine. The company was founded in 1985 and is headquartered in Toronto, Canada. The company is listed on the Toronto Stock Exchange (TSX: TLG), the OTC Markets (OTC: CHXMF), and the Frankfurt Stock Exchange (FRA: CM5R). Tau Mining Ltd. (U.K.) and Signet Minerals Inc. are the company's subsidiaries. 

The Troilus Gold Project

This project is spread across a land area of 142,000 hectares. The site has historically produced a supply of 2Moz gold and 70,000t copper between 1996 and 2010. It was acquired in 2017 by Troilus Gold after an in-depth geological and technical assessment along with technical analysis. 

Post-acquisition, the company has been able to increase the indicated mineral resource to 142% and the inferred mineral resource has increased 350%. This was achieved through an 80,500m drilling carried out in the past 2.5 years. 

Troilus Gold is looking for project financing through major shareholders and plans to bring additional investors on board. The Troilus Project offers a substantially low technical risk as the site has historically produced 2Moz gold and 70,000t copper over 14 years. A PFS is planned for the end of 2021. 

PEA findings

As per the PEA (Preliminary Economic Assessment), the Troilus mine has a life of 20 years, with an annual gold production between 220,000oz - 250,000oz. The company's CapEx (Capital Expenditure) stands at $350M. 

Troilus Gold has been able to add a huge resource fairly quickly with an expert ground team. Currently, they are carrying out 10,000m drilling on a monthly basis. The company also spent $10M in 2020 towards regional exploration and identified 6 potential targets. The geophysics and geochemistry at this site have been concluded. 

The company has a planned inaugural reserve after carrying out 250,000m drilling and is looking to publish a pre-feasibility study by 2021 end. 

Capital Raised

Troilus Gold raised $45M in June at an average share price of $1.45. This financing round consisted of 80% institutional and 20% retail investors. The company currently has equity of $100M that was raised through a bought deal with a syndicate of 5 banks. The company has a market cap of $200M with an 8.1Moz resource.

A drop in the company's share prices was observed 4 days after the financing concluded. This was due to one of the biggest drops in gold prices in the last 13 years. 

The company recently announced a strategic investment of CAD$11M from the government of Quebec at a 20% premium on the current gold price, establishing a strong framework for project financing. This has led to significant de-risking for the company's assets. The $11M investment accounts for 4-5% of the company valuation. 

Securing the investment from the Quebec government was achieved through 8 months of detailed and thorough work on three main aspects. 

1. Ministerial approval,

2. Jobs, taxation, and growth in the future

3. Environment and permitting approval from the Minister of Energy and Resources 

Quebec has been historically known for being pro-development and a permitting jurisdiction. The company is a past producer looking to restart operations. They have a strong working relationship with the Quebec government. This funding and support have helped establish a framework to release the project financing plan for expedited production. 

To find out more, go to the Troilus Gold Website