Minera Alamos (TSX:MAI) New Acquisition Builds On 100,000 oz Annual Production Target by 2026

Nov 5, 2024

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Interview with Doug Ramshaw, President & Director of Minera Alamos Inc.

Our previous interview: https://www.cruxinvestor.com/posts/minera-alamos-tsxvmai-mexican-gold-mining-with-growth-cash-flow-focus-5983

Recording date: 1st November 2024

Minera Alamos (TSXV:MAI) is rapidly advancing its portfolio of high-margin, low capex gold projects in the USA and Mexico. The company recently announced the acquisition of the Copperstone gold project in Arizona from Sabre Gold Mines. This transformative deal adds a near-term production asset in a Tier-1 jurisdiction to Minera's pipeline.

Copperstone is a past-producing mine with substantial infrastructure already in place, including over 4,500 meters of underground development. A 2023 preliminary economic assessment outlined a 6-year, 40,000 oz per year operation with all-in sustaining costs of approximately $1,300/oz. Minera sees potential to optimize the mine plan, reduce capex, and grow the resource through exploration.

Minera aims to bring Copperstone into production by late 2025 or early 2026. This would be followed closely by the startup of the Cerro de Oro project in Mexico, which is anticipated to produce over 60,000 oz per year. Together with the currently ramping up Santana mine, Minera expects to reach a consolidated production rate of 100,000 oz gold per year by 2026.

Minera is acquiring Copperstone by issuing shares to Sabre Gold, with Minera owning 86% of the combined company. Sabre's existing debt will be eliminated as part of the transaction. Closing of the acquisition is expected in January 2025, and in the meantime Minera is focused on optimizing development plans and mobilizing its technical team.

The Copperstone acquisition fits well with Minera's strategy of advancing high-margin, scalable gold projects with low capex intensity. The company's project portfolio boasts industry-leading capital efficiency, with quick paybacks expected on initial investments. By moving Copperstone forward in parallel with its Mexican projects, Minera offers investors multiple shots on goal and a rapid path to intermediate producer status.

Macro trends appear supportive for the gold price, with safe haven demand buoyed by elevated inflation and geopolitical tensions. Minera Alamos President Doug Ramshaw sees particular opportunity for companies that can deliver low-cost, near-term production in this environment. "Developers offer tremendous value in this market," he explained in a recent interview. "Your development assets still got to have a near-term horizon and Copperstone gives us that."

With an experienced management team, a portfolio of de-risked projects, and a clear path to cash flow, Minera Alamos presents a compelling investment case. The Copperstone acquisition marks an inflection point for the company as it transitions into a multi-asset, multi-jurisdictional gold producer with significant growth potential. Investors can look forward to a steady stream of catalysts as Minera advances its projects to production over the next 18-24 months.

View Minera Alamos' company profile: https://www.cruxinvestor.com/companies/minera-alamos