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Hemlo Mining Update | Jason Kosec and Jimmy Connor

Jimmy Connor Feb 1, 2026 21:30

Summary

Hemlo Mining, Canada's newest gold producer, bought the long-producing Hemlo mine from Barrick for $925 million and sees upside from past underinvestment.

A roughly $40 million exploration budget and 130 kilometers of drilling aim to extend a 14-year mine life beyond 20 years.

Idle hoisting and mill capacity let management target 6,000 tonnes per day and 200,000 annual ounces by end-2027 with modest capital.

All-in sustaining costs (AISC — the full cost to produce an ounce) run about $1,400 per ounce, leaving high margins at current gold prices.

Upcoming catalysts include a TSX main board listing, potential March index inclusion, an updated resource statement, and a 2027 NYSE American listing.

Key points on Barrick Mining

  • The guest argues Barrick sold Hemlo because it was non-core at about 5% of its production profile, and chose to direct capital toward drilling off 10 million ounces at Fourmile rather than spend $100-125 million to lift Hemlo from 150,000 to 200,000 ounces a year.
  • Under Barrick's ownership Hemlo was undercapitalized, per the guest: growth drilling ran only about $2 million a year and reserve planning used a conservative $1,700/oz gold price (previously $1,500), which left stopes scattered across the mine.
  • The guest still credits Barrick with preserving margins and running development about 18 months ahead of production, and says buying from a disciplined major means assets like the mill were well maintained.
  • The guest frames the sale as an example of value being unlocked when a major sheds a non-core asset and a dedicated team makes it a core focus.

Mark Bristow's takeaways

  • Top takeaway The guest says that under Mark Bristow, Barrick chose to allocate capital to Fourmile over Hemlo and credits Bristow with running Barrick conservatively to preserve margins rather than reinvest in a 5%-of-production asset.
  • The CEO says that as a geologist he idolizes Bristow, and that Quartermain's relationship with Bristow helped get the team into the Hemlo sale process.

Jason Simpson's takeaways

  • Top takeaway The guest cites Jason Simpson as an example of creating value by pulling non-core assets out of major mining companies and making them a core focus.

Jonathan Awde's takeaways

  • Top takeaway Jonathan Awde, who worked with Bob Quartermain at Dakota Gold, contacted the CEO and helped assemble the team that pursued and won the Hemlo acquisition.

Robert Quartermain's takeaways

  • Top takeaway The guest describes Bob Quartermain as a Mining Hall of Fame member who was at Hemlo for two of the three early-1980s discoveries, giving him an unmatched geological affinity with the asset.
  • Quartermain's relationships with CIBC and Mark Bristow brought the team into the sale process in early April, and the guest says Quartermain's love of geology aligns with targeting undrilled fold closures at depth.

Jimmy Connor's takeaways

  • Top takeaway The host frames the episode around the thesis that Barrick undercapitalized Hemlo — harvesting cash flow without reinvesting — teeing up the new team's optimization plans.
  • He raises Hemlo's valuation discount to comparable companies and drives the deep-dive on deal terms, costs, drilling plans, and upcoming catalysts such as the TSX main board listing and March index rebalancing.