Cygnus Metals

Investor Insight

Cygnus Metals is focused on advancing its highly prospective copper-gold and lithium projects located in prolific mining regions in Quebec, Canada, boasting a high-grade copper and gold resource of 10.8 million tons @ 3.5 percent copper equivalent, and existing infrastructure that includes a 900 ktpa processing facility. The company is strategically positioned to become Quebec's next copper producer.

Overview

Cygnus Metals (TSXV:CYG) is a copper-gold and lithium exploration and development company, positioning itself as a near-term producer in the prolific Chibougamau region of Québec, Canada. With a clear strategic focus, Cygnus Metals is actively advancing its assets toward production, taking advantage of its brownfields high-grade copper and gold projects, existing infrastructure, and supportive jurisdiction. The company’s overarching goal is to establish itself as Quebec’s next copper producer, with a hub-and-spoke mining strategy centered around its Copper Rand mill.

Following its strategic merger with Dore Copper, Cygnus Metals has consolidated a significant land package in prolific mining regions in Quebec - Chibougamau (copper-gold) and James Bay (lithium) - boasting a high-grade copper and gold resource of 10.8 million tons (Mt) @ 3.5 percent copper equivalent, and existing infrastructure that includes a 900 ktpa processing facility.

Cygnus Metals is currently focused on advancing the Chibougamau project, which is located within an area known for its historical copper and gold production, within the world-renowned Abitibi Greenstone Belt.

The company is unique because it owns the only mill in the area. The Copper Rand mill is designed to process an average of 1,350 tonnes-per-day and will need to be refurbished. This infrastructure gives Cygnus Metals a significant competitive advantage, both in terms of reducing capital expenditure requirements and potentially generating additional revenue streams by processing ore from third-party operations.

Québec, as a mining jurisdiction, provides strong support for mineral exploration and development. It ranks highly in the Fraser Institute’s rankings of mining-friendly jurisdictions, offering political stability, favorable tax incentives, and access to well-established infrastructure, including roads, rail, and power.

Cygnus Metals is led by an experienced and highly skilled management team. Ernest Mast, the company’s president and managing director, has over three decades of experience in the mining industry, including leadership roles at companies such as Primero Mining and Minera Panama (Inmet Mining). Mast’s background in managing junior and small-cap mining companies is well-suited to Cygnus Metals' current development phase. The broader management and technical teams bring a wealth of operational expertise, with several individuals having extensive experience in exploration, project development, and mining operations in Canada and internationally.

Company Highlights

• Cygnus Metals has consolidated a significant land package within the prolific mining regions of Quebec, Canada: Chibougamau and James Bay.
• A 2022 preliminary economic assessment (PEA) for the Chibougamau project outlines a relatively modest initial capital expenditure of C$180.6 million, highlighting the economic potential of the project, with an after-tax net present value (NPV) of C$193 million and an internal rate of return (IRR) of 22.1 percent.
• The Corner Bay zone within Chibougamau is among the highest-grade copper deposits in North America, with an indicated resource of 2.6 Mt at a grade of 2.66 percent copper and an inferred resource of 5.8 Mt at 3.44 percent copper grade.
• The 100 percent owned Copper Rand mill will be refurbished for future production and will be the only operating mill in the Chibougamau region. The mill will have extra capacity and provides the ability to process its own ore while potentially offering toll milling services to other nearby mining projects.
• Cygnus Metals is led by an experienced and highly skilled management team.

Key Project

Cygnus Metals' assets are located within two well-known mining regions in Quebec, with a long history of production. The company’s current strategy revolves around a hub-and-spoke model, with the Copper Rand mill serving as the processing hub, fed by multiple satellite deposits.

Chibougamau Copper Gold Project

Located within a historic, high-grade mining camp, the Chibougamau copper gold project spans 187 sq km and includes a 900 ktpa processing plant and existing major infrastructure. The project consists of seven exploration targets, three of which have an existing mineral resource 10.8 million tons @ 3.5 percent copper equivalent.

The Chibougamau region has a rich mining history dating back to the early 1900s. With 16 historic mines, the district has produced some 53.5 Mt @ 3.4 percent copper equivalent (1.8 percent copper and 2.1 grams per ton gold) for 945,000 of copper and 3.5 Moz of gold.

The PEA for the project anticipates a mine life of over 10 years, with the potential to produce 53 million pounds of copper equivalent annually. Metallurgical testing at Corner Bay has yielded positive results, with copper recoveries ranging from 96.8 percent to 98.2 percent, and the concentrate is of high commercial quality, making it highly attractive to smelters.

Cygnus is focused on growing the mineral resources base at the Chibougamau project and move towards a feasibility study. The resource base, which currently stands at 3.6 Mt of measured and indicated mineral resources at 3 percent copper equivalent and 7.2 Mt of inferred mineral resources at 3.8 percent copper equivalent, for a total of 10.8 Mt at 3.5 percent copper equivalent for 306 kt copper and 314 koz gold. The project includes three key assets with existing– Corner Bay, Devlin, Cedar Bay and Joe Mann – all located within 50 km of the central 900 ktpa processing facility.

The Corner Bay deposit is the cornerstone of the project, demonstrating exceptional grades and exploration potential, positioning it as one of the highest-grade copper projects in North America. The latest resource estimate, as of 2022, includes 2.7 million tonnes of indicated resources at a grade of 2.66 percent copper and 5.8 million tonnes of inferred resources at a grade of 3.44 percent copper. The deposit remains open in several directions and at depth, suggesting that further drilling could potentially expand the resource base and extend the mine life.

Devlin is a smaller satellite deposit located approximately 10 kilometers west of Corner Bay. The project has a measured and indicated resource of 775,000 tonnes at a grade of 2.17 percent copper, along with an inferred resource of 484,000 tonnes at a grade of 1.79 percent copper. While Devlin’s size is modest compared to Corner Bay, it plays a crucial role in Cygnus Metals' hub-and-spoke mining strategy. Ore from Devlin will be transported to Corner Bay for pre-concentration, before being trucked to the Copper Rand mill for final processing. The company is planning to employ room-and-pillar and drift-and-fill mining methods at Devlin, with operations expected to commence shortly after Corner Bay comes online.

Cedar Bay is a past-producing mine located near the Copper Rand mill. It produced 3.9 million tons of ore at an average grade of 1.63 percent copper and 3.21 grams per ton gold during its operating life. Drilling programs have defined in the southwest zone 130,000 tons of indicated resources at a grade of 9.44 grams per ton gold and 1.55 percent copper, and 230,000 tons of inferred resources at a grade of 8.32 grams per ton gold and 2,13 percent copper.

The Joe Mann gold-copper deposit is another component of Cygnus Metals' hub-and-spoke strategy. Located 60 km south of the Copper Rand mill, Joe Mann produced 1.2 million ounces of gold and 28 million pounds of copper over its mine life, at an average grade of 8.26 grams per ton gold and 0.25 percent copper. The current resource estimate includes 608,000 tons of inferred resources, with an average grade of 6.78 grams per ton gold and 0.24 percent copper.

Board and Management

David Southam - Executive Chairman

David Southam is highly experienced in operations, project development and capital markets across the resources and industrial sectors. He was previously the managing director of Mincor Resources. Southam is non-executive director of Ramelius Resources and non-exec chair of Andean Silver Limited.

Ernest Mast – President and Managing Director

Ernest Mast has 30 years of experience in various technical and executive roles in the mining industry, across a wide range of commodities, geographies and development stages. Mast is on the board of Scottie Resources. Mast previously held the positions of president and chief executive officer at Primero Mining, vice president of corporate development at Copper Mountain Mining, vice president of operations at New Gold and president and CEO of Minera Panama S.A., Inmet Mining Corporation’s subsidiary, developing the $6 billion Cobre Panama project. Mast began his career with Noranda and its affiliates, where he took on roles of increasing responsibility over a 20-year timeframe. Mast is a member of l’Ordre des ingénieurs du Québec and has a bachelors’ and masters’ degree in metallurgical engineering from McGill University. Mast also received post-secondary business training at Henley College in the UK and at the Universidad Catolica in Chile.

Mario Stifano – Non-executive Director

Mario Stifano is a seasoned mining executive and chartered professional accountant with over 16 years of experience working with exploration, development and producing mining companies. Stifano is currently the chief executive officer of Galantas Gold. Stifano has held a number of senior executive positions including chief executive officer of Cordoba Minerals, executive chairman with Mega Precious Metals, vice president and chief financial officer with Lake Shore Gold, and vice president and chief financial officer of Ivernia. Stifano has been instrumental in raising over $700 million to explore and fund mining projects, including raising over $500 million at Lake Shore Gold, to develop three gold mines which are currently producing over 180,000 ounces of gold annually, and are now part of the Canadian assets within Pan American Silver.

Kevin Tomlinson - Non-executive Director

Kevin Tomlinson is a structural geologist and investment banker. He is the non-executive chair of Bellevue Gold and of FireFly Metals. Tomlinson has a successful track record in base and precious metals project development.

Raymond Shorrocks – Non-executive Director

Raymond Shorrocks brings a wealth of experience in corporate finance, stockbroking and financial services in Ontario. He was the previous non-executive chair of FireFly Metals and Bellevue Gold. He is the executive chair of Alicanto Minerals.

Brent Omland – Non-executive Director

Brent Omland is the co-CEO of Ocean Partners providing a range of trading services for miners, smelters and refiners globally. He is a chartered accountant and has held CFO roles for publicly listed companies in the resources industry.