Artemis Gold hits new high on Blackwater plan

Artemis Gold (TSXV: ARTG) has announced plans to upgrade the existing stage one processing plant at its Blackwater mine in central British Columbia, a move that the company regards as a “step change” opportunity while it progresses with a stage two expansion.

Amongst the upgrades will be a vertical mill to provide additional primary grinding capacity and expanded leach circuit, says Artemis, adding that construction work for the upgraded plant (stage 1A) has already started, with completion and commissioning both earmarked for the fourth quarter of 2026. Some of the enhancements are expected to be brought online in steps ahead of the completion date.

Once up and running, the stage 1A plant will operate at an increased nameplate capacity of 8 million tonnes per year, a 33% increase from the 6 million tonnes currently. The company estimates that these upgrades would cost C$100 million to C$110 million and have an industry-low capital intensity of $50-$55 per additional tonne of processing capacity. A majority of the capital is expected to be spent in calendar 2026.

The stage 1A project will be funded out of the company’s operating cash flows, and the payback period is expected to be less than six months, Artemis’ CEO Dale Andres said.

‘Cost-effective optimization’

With the stage 1A announcement, shares of Artemis Gold hit a new all-time high of C$33.40 apiece, taking its market capitalization to nearly C$7.7 billion.

Haywood Capital Markets analyst Pierre Vaillancourt said that after Blackwater’s strong start, the expansion bodes well for a stage two expansion decision in this year’s fourth quarter.

Step change opportunity

The project was identified as a “near-term, capital-efficient step change opportunity,” Andres said, while the team was reviewing stage two expansion scenarios.

“We expect [stage] 1A to de-risk and enhance future free cash flows that are aimed at funding a larger [stage two] expansion,” he said.

The company is currently anticipating an investment decision on the stage two expansion in the next quarter. On completion, stage two has the potential to increase production to over 500,000 gold-equivalent ounces per year, Andres added.

Additionally, the company said the stage 1A enhancements will support the ongoing ramp-up and optimization of the existing stage one plant, for which it aims to achieve throughput at 10% above nameplate by Q4 2025.

The Blackwater mine entered commercial production in May, becoming the province’s first new gold mine in eight years. The open-pit mine is expected to deliver 190,000 to 230,000 oz. of gold this year, but its annual production could reach 321,000 oz. during stage one, subsequently rising to 381,000 oz. in stage two and 438,000 oz. in a potential stage three.