Integra Resources Corp. has officially entered into a definitive merger agreement with Florida Canyon Gold Inc (FCGI), thus creating one giant of a gold and silver producer in the Great Basin. Under the agreed terms, Integra will acquire all issued and outstanding shares of FCGI pursuant to a court-approved plan of arrangement. To expand upon that a little bit, FCGI shareholders will receive a common share worth 0.467 of Integra for each common share of FCGI. More on the same would reveal how existing shareholders of Integra and FCGI will own an estimated 60% and 40%, respectively, of the outstanding Integra Shares on the transaction’s closure, and they will do so on a fully-diluted in-the-money basis. Anyway, once it has fulfilled all of the deal’s obligations, Integra will hold a diversified, as well as tactically sequenced portfolio of gold-silver production and development assets, a portfolio which happens to have a place within the top tier mining jurisdiction of the Great Basin. Furthermore, Florida Canyon will also bring forth two high-quality development projects in DeLamar and Nevada North. Both these factors, and the other related ones, should be able to help Integra materially grow its production profile and become a mid-tier producer capable of delivering over 250kozs AuEq per annum. Talk about the expected by-products from this deal on a slightly deeper level, we begin with how it will establish Integra as a newly formed junior gold-silver producer, providing investors immediate exposure to the strong metal price environment through Florida Canyon. We get to say that because Florida Canyon is a proven open-pit mining operation, which has showcased solid operating performance in recent years due to enhancements to personnel and operational practices. Before we discuss operation’s production prowess any further, we must acknowledge that, in 2023, it reported production of 71kozs AuEq at net cash costs and AISC of $1,368/oz and US$1,654/oz, respectively. On top of that, 2024 NI 43-101 Technical Report for Florida Canyon also demonstrated a 7 year mine life, producing an average of 70kozs AuEq per annum and generating an after-tax Net Present Value (“NPV”) 5% of $128 million.
Next up, we must get into the deal’s project-related potential. You see, the merger in question will empower Integra to access a robust portfolio of strategically sequenced, oxide heap leach projects that will create a clear a path to growing production and becoming a mid-tier precious metals producer. We referred to how these projects include DeLamar and Nevada North, but what we didn’t mention was how the former presents itself as an advanced gold-silver heap leach project located in southwestern Idaho. Furthermore, DeLamar is also one of the few gold-silver development projects in the Western U.S. that will be actively advanced through the National Environmental Protection Agency (“NEPA”) mine permitting process, demonstrating the significant scarcity value of the project. As for Nevada North, it is made up with Wildcat and Mountain View deposits, located in northwestern Nevada. Markedly enough, a 2023 Preliminary Economic Assessment for Nevada North demonstrated for it a 13-year mine life, producing an average of 80kozs AuEq per annum, and generating an after-tax NPV5% of $490M and IRR of 37%.
The Integra-Florida Canyon deal is going to further ensure the availability of significant resources. In essence, the collective portfolio of three high-quality oxide heap leach gold-silver projects will make a point to provide 5.2 million ounces Au, and 152.5Mozs Ag in the M&I category, and 2.9Mozs Au 17.2Mozs Ag in the Inferred category. There will also be mineral reserves of around 2.0Mozs Au and 51.3Mozs Ag in the Proven and Probable category based on oxide and mixed ore. Another detail worth a mention here is rooted in community benefits, with the transaction poised to create 20+ years of employment for the local workforce at Florida Canyon. It will also generate significant benefits for communities surrounding Integra’s key projects in Nevada and Idaho.
