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Borealis Is Mining. Guidance Comes Next | Kelly Malcolm

Mining Network Sep 27, 2026 13:57

Summary

Borealis has cleared start-up's hardest phase: crusher clay-blending resolved, pit water controlled, and a best month of 130,000 tonnes crushed.

CEO Kelly Malcolm expects production and throughput guidance within a month, with positive cash flow close behind as the ramp completes.

The ADR plant (where gold is stripped from carbon and poured) stays under-full for two years, so toll treating is on the table.

Sandman's February 2026 PEA (preliminary economic assessment — an early mine economics study) showed US$203 million after-tax NPV and 105% IRR at $2,600 gold.

Malcolm's path: mine-plan study by first-half 2027, Sandman permit around mid-2028, first production 2029, plus a new leach pad for under US$10 million.

Key points on Borealis Mining Company Ltd

  • Kelly Malcolm says Borealis is past its ramp-up after the first blast in February 2026, crushing a best month of about 130,000 tonnes, with throughput expected to keep rising.
  • He says operational guidance, including throughput numbers, was delayed to finalize figures and should be out within about a month of the interview (as of September 2026), with the mine close to cash flow positive.
  • Early crusher bottlenecks from blending soft clay with hard, high-grade siliceous ore have been resolved, and a water problem in one pit is largely fixed, with a second pit now stripped and hauling ore.
  • Malcolm says the plant will not reach full capacity for at least two years, so Borealis is looking at toll treating to keep it running closer to full.
  • Growth plans include a wall pushback at Freedom Flats (historically 200,000 ounces at 5 g/t oxide), permitting the high-grade JRCD area as a separate operation, an eastern exploration program under the US Forest Service, and new heap leach pads costing roughly $6-8 million per ~12 million tonnes.

Kelly Malcolm's takeaways

  • Top takeaway Malcolm argues Borealis has finally built the hub-and-spoke business he was after, with mine cash flow funding exploration, and he plans to market the company hard again after staying quiet since around March 2026.
  • He stakes his case on Sandman's PEA: roughly a half-billion-dollar post-tax NPV at a 6% discount and 230% IRR against a 430,000-ounce resource, and he defends the earlier $2,600-gold case that still produced a $200 million NPV and 106% IRR.
  • He sketches a Sandman path of a PFS-style study by the first half of 2027, permitting around mid-2028 and full production in 2029, with simple math of about $1,500 per ounce of margin on 40,000 ounces at a $2,500 AISC versus $4,000 gold.
  • He pushes back on the idea that Sandman becomes the bigger prize, treating it as a meaningful second asset whose cash flow validates the model of mines funding the next build.
  • He expects a much higher valuation within a year as Borealis shows quarters of positive production, and says the company is actively pursuing M&A to add another asset, calling the process a soul-sucking experience.