Marathon Gold shares rise as its proposed Berry pit expansion passes provincial EA process

Marathon Gold (TSX: MOZ) shares edged higher on Monday following a positive development on the company’s plans to expand its flagship Valentine project located in Newfoundland and Labrador by including a third open pit.

In a news release, Marathon announced that the province’s minister of environment and climate change has released the proposed addition of the Berry deposit to the Valentine project from its environmental assessment (EA) process. The decision followed a regulatory and public review of the expansion registration documents submitted in August.

Valentine is considered the largest undeveloped gold project in Atlantic Canada and is scheduled to begin production in early 2025. Construction at the project, which comprises a series of five mineralized deposits along a 32-km system, first began in October 2022.

“Today’s news is very positive. The Berry deposit was discovered in 2020 and first included as a third pit within the Valentine mine plan in our December 2022 updated feasibility study,” said Matt Manson, Marathon’s CEO.

As is customary for projects released from the provincial EA process, the decision letter includes certain terms and conditions with which Marathon must comply, including completion of water-related plans and studies, ongoing caribou monitoring and mitigation, avifauna surveys, and an update to the Newfoundland and Labrador benefits agreement to include the Berry pit expansion.

The conditions are similar to those required in the March 2022 provincial EA release, which included Leprechaun and Marathon pits, the process plant, and tailings management facility, the company notes.

On the federal level, the Berry EA documentation was also submitted to the Impact Assessment Agency of Canada (IAAC), and on August 30, Marathon received confirmation from IAAC that the proposed expansion does not constitute a new “designated project,” and as such, a new impact assessment is not required.

As per the federal conditions of release for the Valentine gold project, potential environmental effects of proposed changes to the designated project must nevertheless undergo review, Marathon adds. This process, which is ongoing, is anticipated to result in an amended decision statement.

In the project’s latest feasibility study, Marathon anticipated that the federal and provincial assessments for Berry would be completed by the middle of 2024. The NL minster’s decision means that provincial permitting can now proceed immediately, in some cases via amendments to existing Project permits, and in other cases with new Berry-specific permits.

“While review at the federal level continues, our earlier guidance that the federal regulator will not require a new impact assessment means that Berry is on track to be fully permitted well in advance of its scheduled mining in the second quarter of 2025,” Manson added.

Shares of Marathon Gold closed the market at 59¢ apiece, a 3.5% gain for the day. The company has a market capitalization of $238.1 million.