Centerra Gold Targets Growth With Mount Milligan Expansion, Goldfield and Thompson Creek Plans

Key Points

• Mount Milligan remains Centerra Gold’s cornerstone asset: Current reserves support operations through 2045, while additional indicated resources could extend the mine life by roughly another decade. Recent operational improvements have helped the mine deliver three consecutive quarters in line with guidance.
• The company is advancing a broad development pipeline: Goldfield’s $250 million oxide project is scheduled to begin production in mid-2028, Kemess is moving toward a prefeasibility study, and the $425 million–$450 million Thompson Creek molybdenum restart remains targeted for mid-2027.
• Centerra is balancing growth investment with shareholder returns: Liquidity exceeds $1 billion, including a $600 million credit facility and $450 million in cash, while the board authorized up to $200 million in buybacks. Management is also evaluating strategic options for its U.S. molybdenum business, including a potential IPO or separation.

Centerra Gold NYSE: CGAU is shifting from studies and portfolio planning into project execution across its gold, copper and molybdenum assets, President and CEO Paul Tomory said during a company presentation.

Tomory said the company spent the past several years assessing the roles and value potential of assets including Mount Milligan, Kemess, Thompson Creek and Goldfield. The focus has now turned to advancing development projects, improving operating execution and pursuing mine-life extensions.

“We have a lot of metal in the ground, gold, copper, molybdenum,” Tomory said. “What we have to do is work through a number of studies on each of our assets ... to put together a cogent plan on where do these assets fit in the portfolio, and what is the value potential for each of them.”

Mount Milligan Performance and Mine-Life Potential

Mount Milligan, the company’s British Columbia gold-copper operation, remains Centerra’s cornerstone asset, according to Tomory. The current reserve plan supports operations through 2045, while an additional 230 million tons of indicated material could potentially support another decade of mine life.

Centerra has delivered three consecutive quarters of production in line with guidance at Mount Milligan, Tomory said, following work to improve its understanding of the ore body and strengthen the operating team.

The company completed infill drilling and a prefeasibility study that improved its characterization of grades, recoveries and geometallurgical domains. It also appointed a new general manager and recently added Kelly Strong as chief operating officer.

Tomory said continued drilling west of the current reserve area has encountered mineralization and filled gaps that had previously been classified as waste blocks. He said the company expects Mount Milligan to remain a multidecade operation.

Development Pipeline Advances

Centerra is advancing several development projects, including the Goldfield oxide heap-leach project in Nevada, the Kemess gold-copper project in British Columbia, and the Thompson Creek molybdenum mine restart in Idaho.

At Goldfield, the company’s study outlined $250 million in capital expenditures and production beginning in mid-2028. Centerra increased its 2026 capital-expenditure guidance because it was able to accelerate civil earthworks and site-preparation work, Tomory said. He characterized the higher spending as a pull-forward of work rather than a change in the overall project budget or schedule.

“The overall project remains on schedule and on budget,” Tomory said. “We just took the opportunity to advance some of the works and lead to a de-risking.”

Centerra is also conducting drilling across Goldfield’s large land package. While the immediate priority is construction of the oxide project, Tomory said the company also has a sulfide inventory that is not included in the current study and could be evaluated in the future.

At Kemess, a past-producing site with existing infrastructure including a mill, power line, camp, airstrip and truck shop, Centerra is advancing a prefeasibility study after releasing a preliminary economic assessment in January. The PEA outlined an initial 15- to 17-year mine life, with annual production of 150,000 to 175,000 ounces of gold and 50 million to 70 million pounds of copper.

Tomory said the PEA mines less than half of the project’s resource, focusing on a low-strip-ratio open pit and a higher-grade underground operation. The prefeasibility study is expected in the middle part of next year and will further refine capital-cost estimates, recoveries, mine planning and infrastructure requirements.

Öksüt Optimization and U.S. Moly Business

At the Öksüt mine in Turkey, stronger grades and recoveries contributed to an increase in production guidance, Tomory said. Centerra is evaluating a mine-life extension beyond the current reserve life ending in 2029.

The planned study will consider mining lower-grade oxide material along the oxide boundary and recovering additional gold through residual leaching from existing heaps. Centerra is targeting the end of February for the mine-life extension study.

Meanwhile, the company is progressing with the Thompson Creek molybdenum restart, which is targeted for first production in mid-2027. The $425 million to $450 million project remains on schedule and on budget, according to Tomory.

Centerra’s U.S. molybdenum business also includes a Pittsburgh roaster that processes third-party unroasted molybdenum concentrates. Tomory said the company views the Idaho mine and Pittsburgh facility as a “company within a company,” supplying finished molybdenum products to U.S. steelmakers.

He said Centerra is open to options including an initial public offering or separation of the business, but would only pursue a transaction if it achieves full value recognition for shareholders.

Capital Allocation and Valuation

Centerra recently increased its corporate credit facility to $600 million, bringing total liquidity above $1 billion, including $450 million in cash, Tomory said. The company’s board also approved up to $200 million in share repurchases during the year.

Tomory said Centerra completed $50 million of buybacks in the second quarter and expected third-quarter repurchases to exceed that amount. The company plans to continue funding its development pipeline while using buybacks to reduce its share count when management believes the stock is undervalued.

He cited improved Mount Milligan performance, greater clarity around the molybdenum business and continued project execution as factors that could support further market recognition of the company’s asset base.

About Centerra Gold (NYSE:CGAU)

Centerra Gold Inc is a Canadian-based, intermediate gold and copper producer headquartered in Toronto, Ontario. The company explores, develops and operates precious- and base-metal properties, with a focus on responsible mining and the production of gold and copper concentrates and doré.

Centerra's principal operating assets include the Mount Milligan copper-gold mine in British Columbia, Canada, and the Öksüt gold mine in Türkiye. Mount Milligan produces copper and gold concentrate, while Öksüt is an open-pit, heap-leach operation that produces gold doré.

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