LAHONTAN GOLD: THE 13-KILOMETRE SECRET BEHIND SANTA FE

THE COST TRAP ON THE GREENFIELD SITE

Anyone who has tried to build a new gold mine on a greenfield site over the past two years has experienced an inflation-driven disaster. Worldwide, skyrocketing costs for steel, energy, and processing plants are eating into explorers' margins. Many gold deposits are stuck in a profitability trap: The metal is there, but the high initial investments (Capex) for new infrastructure make mining unprofitable for years to come. This is exactly where the wheat is separated from the chaff. Tomorrow's winners are not necessarily the companies with the biggest drilling headlines, but those with the smartest infrastructure strategy. Kimberly Ann, founder and CEO of Lahontan Gold, proves that a new approach is increasingly making its mark in the traditionally male-dominated mining industry. Her recipe for success is not based on financial megalomania, but on geological efficiency and logistical finesse.

The company, listed on the Canadian TSX Venture Exchange, owns a promising flagship project, the formerly producing Santa Fe open-pit mine, in the heart of Nevada's Walker Lane Trend. Between 1988 and 1994, Corona Gold produced 359,000 ounces of gold and 702,000 ounces of silver, which was profitable at least at times despite the low gold price of USD 340 per ounce. With a current resource estimate of 1.95 million ounces of gold equivalent, and existing infrastructure including paved roads, its own water rights, and power connections, the project serves as the company's solid foundation, which the stock market currently values at just under CAD 170 million.

THE TREASURE IN THE SHADOW OF THE MAIN MINE

But the real highlight, which has so far gone largely unnoticed by the mainstream, lies just 13 km further west: the West Santa Fe satellite project. "People should pay more attention to West Santa Fe. The risk is so low, it is ridiculous," CEO Ann recently emphasized in an interview with IIF host Lyndsay Malchuk. What looks like a dinghy on the map turns out to be a logistical home run. The magic formula is "hub-and-spoke." Instead of building a separate processing plant for West Santa Fe, the ore mined there will be transported by truck over the short distance directly to the main mine's existing infrastructure once production begins. The additional construction costs for the satellite project would thus be minimal.

Such a satellite concept stands or falls on the nature of the rock. And this is precisely where Lahontan can play another trump card. Recent metallurgical tests yielded an average gold recovery rate of 81%—a figure well above historical expectations of 70%. Another decisive advantage is that the gold is present in an oxidized form. This means that the precious metal is not firmly locked within hard rock but can be more easily dissolved chemically. In this process, known as "heap leaching," the mined rock is crushed to gravel size, piled onto large heaps (pads), and sprayed with a weak cyanide solution, which is collected at the bottom after seeping through the heap.

THE SPECIAL ATTRACTIONS OF THE SATELLITE PROJECT

Added to this is the geological quality: the ore at West Santa Fe is in places significantly higher grade than in the main deposit. Recent drilling results significantly exceeded expectations with intervals of 3 to 6 grams of gold per ton (g/t AuEq). In Nevada, where even 0.5 g/t AuEq is often considered highly profitable in open-pit mining, this is a remarkable achievement. The significant silver content of up to 648 g/t is also far more than just a welcome bonus.

A look at the Preliminary Economic Assessment (PEA) shows just how profitable the overall project can be. The planned mine construction costs for the reactivation of Santa Fe amount to USD 135 million, including a 20% cost buffer reserve. According to the company, management intends to finance a large portion of this through debt, thereby minimizing further dilution of shareholders through capital measures. Just last April, Lahontan raised CAD 13.6 million through a private placement. As a result, CEO Ann considers exploration activities to be fully funded well into 2027. This also includes large-scale drilling programs in neighbouring areas, such as Slab West, South Slab, or Guzzler.

THE ROADMAP TO REVALUATION

However, these—like West Santa Fe—are merely icing on the cake. The Santa Fe main project is expected to generate the initial cash flow. The original PEA calculation, based on a gold price of USD 1,950 to USD 2,025 per ounce, which was later adjusted upward to the then-current spot price of USD 2,705, already yielded a positive after-tax net present value of USD 200 million, an internal rate of return (IRR) of 34.2%, and a payback period of 2.9 years. Based on the current gold price, the net present value would have to be nearly twice as high. The payback period should shorten to 9 to 18 months, which the CEO puts in her pragmatic way: "We are going to print money." The roadmap is set. The updated resource estimate is expected to be released in the coming weeks, followed by a new PEA study adjusted to the current gold price, which is scheduled to be presented in September. The final operating permit is expected in the first quarter of 2027, followed by a short construction period of no more than six months. The first gold is scheduled to be poured in the fourth quarter of 2027.

But why is the share price only around CAD 0.40 and currently below EUR 0.25 on German exchanges? The answer lies in the new capital structure. In the spring of 2026, Lahontan forced the early exercise of outstanding warrants because the share price had traded above the respective thresholds for a sufficient period. This process served as a technical cap on the share price, as some warrant holders immediately sold the newly allocated shares on the market. However, this dilutive effect is now largely over. The result: together with the recent private placement, the company received a substantial cash inflow. The coffers are well-filled, and initial term sheets from banks for the financing of the necessary USD 135 million to reactivate the Santa Fe main mine are already in place.

HISTORY SHOULD NOT REPEAT ITSELF

It would not be the first time that Kimberly Ann has taken a small explorer into a new dimension. Together with her co-founder Brian Maher, who is considered the geological mastermind of Lahontan, she had already built up three mining companies in the past, including Prodigy Gold. That story ended in 2012 with the acquisition of Prodigy by Argonaut Gold. This time, however, the Ann/Maher duo intends to reap the rewards of their work themselves and is dismissing takeover speculation for the time being. No wonder, because for the price of a penny stock, there is a perfectly financed, low-risk project in one of the safest mining regions in the world—with the added option of West Santa Fe and other promising deposits that are not even remotely factored into the current market valuation.

IIF host Lyndsay Malchuk interviews CEO & founder Kimberly Ann:

https://youtu.be/QGRV7IfTWec