Gold Exploration and Development
Convergence and divergence
Perhaps the biggest story in Québec and Atlantic Canada’s gold development scene in 2024 was Gold Fields’ October acquisition of Osisko Mining. The CA$2.2 billion transaction, which Resourcing Tomorrow named as its 2024 Deal of the Year, saw Gold Fields increase its previous 50% stake in the Windfall project and Osisko’s other Québec properties to 100%. Andreanne Boisvert, Gold Fields’ VP environment and community relations, emphasized the significance of the Osisko acquisition for Québec: “It is a major deal for the province’s M&A landscape, and could serve as a catalyst for future transactions. I believe it signals a renewed global interest in the province, which continues to attract attention thanks to its predictability, political stability, abundant natural resources and skilled workforce.”
Another notable acquisition was Agnico Eagle’s CA$204 million, 100% purchase of O3 Mining. Andrew Disipio, a partner at Bennett Jones, the legal firm advising Agnico Eagle during the acquisition, discussed key drivers of 2024’s heightened M&A activity: “A continued disconnect between record commodity prices and public market valuations for exploration and development companies created opportunities for strategic buyers to unlock value through acquisitions.”
In other words, while a seemingly ever-climbing gold price has filled the coffers of producers, at the other end of the spectrum, smaller gold-focused juniors have remained undervalued, struggling to access capital to finance their exploration activities. Despite conventional wisdom that investor capital would ‘trickle-down’ from the high gold price, first to producers, then developers, then explorers, reality has been less forgiving. “In the current cycle, the trickle-down effect has been slower to reach the junior space, even as producers have built substantial cash reserves from rising gold prices,” explained Dan Wilton, CEO of First Mining Gold, which is developing projects in Ontario and Québec.
"In times of uncertainty, capital tends to shift towards precious metals. This usually triggers a trickle-down effect from producers to juniors. In the current cycle, that effect has been slower to reach the junior space." Dan Wilton, CEO, First Mining Gold
A look at the data
Mathieu Savard, CEO of gold explorer Vior, offered his perspective on the market, with a word of caution: “In Québec, gold discoveries have been limited in recent years. Yet, despite rising gold prices, capital is not being directed toward junior explorers. As acquisitions continue, the industry risks depleting its project pipeline.”
This warning appears to reflect a broader shift in exploration priorities. Despite gold’s price rally in recent years, investment in precious metal exploration in Québec has fallen sharply from its peak, dropping more than 50%, from CA$707 million in 2021 to CA$326 million in 2024, the lowest level since 2016 (Figure 1). In contrast, exploration spending on critical minerals such as lithium and rare earths surged by over 330% in the same period, from CA$75 million to CA$337 million, fueling a wave of new discoveries.
Base metals have also attracted growing investment since 2020, with spending projected to continue rising, so that, since 2023, exploration spending on precious metals has fallen below the combined total for base and other metals. Early forecasts for 2025 suggest a possible rebound in precious metals exploration, but the broader shift toward critical and base metals appears likely to continue, despite a softening of the lithium and other critical metals prices.
At the same time, Québec’s exploration landscape appears to be undergoing another major shift, marked by an apparent transfer of leadership from junior companies to major players. As shown in Figure 2, while majors have led exploration spending in Canada’s Atlantic Provinces since 2022, juniors have long dominated in Québec. That dynamic is now changing. Natural Resources Canada’s projections suggest that in 2025, majors will account for the majority of exploration investment in Québec for the first time in a decade, despite a modest rebound in junior spending. It marks a stark departure from 2022, when majors represented just a quarter of the province’s exploration expenditure.
All this seems to chime well with the analysis of Pascal Hamelin, CEO of gold developer Abcourt Mines, suggesting that gold producers’ could take advantage of high revenues to expand their exploration and shore up their resources: “As cash accumulates, gold producers will need to reinvest to replace depleted reserves. Initially, this will drive exploration near existing assets, but over time, the search will expand outward – 5, 10, even 100 kilometers from current operations,” he predicted.
"Given their higher risk profile, juniors are often overlooked by generalist investors. Despite favorable gold prices, junior companies remain underfunded – a situation we hope will soon improve." Olivier Grondin, Chairman, Québec Mining Exploration Association
Tapping new veins
For some gold-focused juniors, the search for progress in a difficult market has led to the adoption of innovative and unconventional approaches to exploration. Emperor Metals’ use of artificial intelligence (AI) and leveraging Maptec’s geological modelling platform led to the discovery of its Duquesne West asset. CEO John Florek was bullish on AI’s significance for the sector going forward: “AI technology saves time and money, making it essential for mining companies to adopt or risk falling behind.”
Meanwhile, Puma Exploration has implemented an exploration strategy employing extensive sampling and minimal drilling, described by Mia Boiridy, its head of investor relations, as a “low cost and high return” approach. The New Brunswick-based explorer struck an option agreement for its flagship Williams Brook project with Kinross Gold in October 2024.
For others, a consolidating junior market has provided opportunities for inorganic growth. According to CEO Tim Clark, Fury Gold Mines’ acquisition of Québec Precious Metals offered benefits for both parties: “From a market perspective, many junior companies have been trading at historically low valuations. By combining, we eliminated overlapping administrative costs and created a stronger entity,” he said, while also highlighting possible rare earth exploration upside at Fury’s newly-acquired Kipawa property.
Rick Breger, president and CEO of Harfang Exploration, which acquired Ontario-focused NewOrigin in 2024, predicted this consolidation trend was set to continue: “Historically, strong commodity prices have often spurred increased M&A activity. I believe we are on the cusp of another wave of consolidation, particularly in gold.”
At both ends of Québec and Atlantic Canada’s gold exploration sector a new wave of consolidation is underway. Major players are acquiring large-scale projects, while smaller explorers pursue strategic opportunities for growth. Yet, even as this consolidation unfolds, the divide between juniors and majors appears to be widening. Juniors continue to grapple with limited access to capital, while producers, flush with cash from sustained high gold prices, are investing to push the boundaries of existing mine sites and enjoying a dominant position in expenditure terms.
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