West Red Lake Gold Mines – Q2 Financials, H2 Development & Production Ramp Up, Exploration Update

The KE Report Sep 24, 2026 22:12

Summary

Madsen's Q2 showed the ramp-up is delivering: production up 51% and AISC (all-in sustaining cost — full cost per ounce) down 30%.

The CEO argues high fixed costs mean AISC falls mechanically as ounces rise, so quarterly snapshots mislead until the year-end run rate.

Shaft hoisting costs about a quarter of truck hauling, and phase two could lift hoisting capacity to 700 tons per day in late 2027.

Williams outlines a hub-and-spoke plan: multiple satellite deposits feeding the Madsen mill, aiming for 100,000-120,000 ounces with a study due soon.

He points to a larger Canadian peer's multibillion-dollar market cap, arguing regional consolidation could lift output toward 200,000 ounces.

Cited by the CEO as a scale reference in Red Lake: Evolution, which bought the original Red Lake mine, produces about 120,000-130,000 ounces a year there - roughly the level WRLG's combined hub-and-spoke plan would approach.

The CEO uses Wesdome as WRLG's benchmark peer: two high-grade mines in the Abitibi producing about 160,000-180,000 ounces a year, Canadian, tier-1 jurisdiction, permitted - with 'a lot of similarities' to WRLG's Red Lake setup.
The speakers contrast Wesdome's market cap, cited at roughly $3-5 billion, with WRLG's around $300-plus million, framing a large valuation gap for WRLG to close.

The CEO says the Q2 2026 results, released August 25, 2026, delivered the promised step up: gold production rose 51% and AISC fell 30% versus Q1, even with the gold price down over the same period, and he expects full run-rate production by the end of 2026.
A pre-feasibility study folding Rowan into the plan is expected around end-September or early October 2026; the CEO says the combined hub-and-spoke operation points to 100,000-120,000 ounces a year, with a path toward 200,000 ounces through regional consolidation and a mill expansion to 1,500 tonnes per day.
The strategy is four to five independent mining hubs - underground zones plus surface satellites - feeding the 800 tonne-per-day Madsen mill, adding roughly one satellite a year: Fork enters the mine plan in the back half of 2027 and the next surface target in 2028.
Shaft refurbishment is a major cost lever: the 1,200-metre shaft would cost about $200 million to build today, skipping is roughly a quarter the cost of trucking, and hoisting capacity steps from 200 to 700 and up to 2,000 tonnes per day, with the real benefit in the back half of 2027.
With 50-60% of Madsen costs fixed, the CEO argues AISC falls as ounces rise, and Rowan's higher-grade ore - which he says recovers better and suits gravity processing - is planned at a couple hundred tonnes per day to add ounces without major mill capex.

Top takeaway The host argues the market treats WRLG's Madsen as a 'hobby mine' doing 6,000-8,000 ounces a month and misses how the shaft upgrade, satellite deposits, Rowan and Mount Jamie stack into a far larger production profile.
He frames the valuation case as a wide gap to close: WRLG at around $300-plus million versus benchmark peer Wesdome at a multi-billion-dollar market cap with a similar high-grade, tier-1 Canadian, permitted profile.
He lays out the growth pathway from today's 40,000-60,000 ounces a year toward 100,000-150,000 and potentially 200,000 ounces via regional consolidation, and presses the CEO on whether 120,000 ounces a year is a reasonable goal.
On Q2 he stresses the ramp-up is delivering as messaged since late 2025 - production up 51% and AISC down 30% versus Q1 - while noting cost declines may moderate from here.