Transforms into a Revenue-Generating Royalty Company

QP: Jonathan Findlay, P. Geo, Geological Consultant to TNR. 

• TNR is up 55% since our previous report in February 2025. Early this year, Ganfeng Lithium (SZSE: 002460/MCAP: $13B) commenced production at its Mariana lithium project. Based on current spot lithium prices, we project annual royalty revenue of $1M for TNR. We anticipate TNR will begin receiving royalty payments in Q4-2025.
• TNR’s portfolio primarily consists of a gold project in Alaska (Shotgun), and royalties in two advanced-stage projects in Argentina, including the Mariana lithium project owned by Ganfeng, and the Los Azules copper-gold project owned by McEwen Inc. (privately held). 
• McEwen Copper’s Los Azules copper-gold project hosts a large, open-pittable copper deposit (38 Blbs copper + 4.7 Moz gold + 159 Moz silver), with a resource update and feasibility study expected this quarter, following recent drilling. McEwen aims to begin construction in 2026, and commence commercial production by 2029. We are projecting annual royalty revenue of $6M using conservative copper prices, and up to $10M at current spot prices.

• Both Ganfeng and McEwen have applied to Argentina’s Large Investment Incentive Regime (RIGI) for their projects. The program offers tax breaks, customs incentives, and legal stability, reflecting Argentina’s push to create a more attractive and stable environment for large-scale mining investment.
• TNR is actively pursuing a JV partner to advance the Shotgun project to a PEA, and intends to spin out the asset. 
• After a two-year downturn, lithium prices are turning around, a rebound we forecasted earlier this year. Prices have jumped 17% in the past month to US$9,800/t, though they remain down 18% YoY, and 88% from their late-2022 peak. Current levels are below the break-even point for most new large-scale projects, and we believe a sustained price of at least US$15,000/t is necessary to incentivize development. We expect this rebound to continue as the market moves toward a projected 2026 supply deficit. This deficit will be driven by battery demand from core EV and energy storage markets, as well as from rapidly growing sectors like AI data centers, robotics, and automation.
• Upcoming catalysts include the commencement of royalty revenue from Mariana, an updated resource estimate and feasibility study on Los Azules, and the potential for a joint venture partner at Shotgun.

Price and Volume (1-year)

	YTD	12M
TNR	70%	42%
TSXV	30%	37%

 

Portfolio Summary

90% interest in the Shotgun gold project in Alaska 

Royalties in two advanced-stage projects in Argentina, including a lithium project owned by Ganfeng Lithium, and a copper-gold project owned by McEwen Inc

Mariana Lithium-Potassium Brine Project, Argentina (1.35% NSR)

This advanced stage lithium project is 100% owned by Ganfeng Lithium. In February 2025, Ganfeng commenced production at a 20,000 tpa lithium chloride plant. 

Located in Salta province, Argentina. Argentina is the fourth largest lithium producer in the world. The project hosts a large lithium-potassium brine resource 

A 2018 PEA based on a 10,000 tpa operation, and a 25-year mine life, returned an AT-NPV10% of US$192M, and an AT-IRR of 20%, using US$9.70k/t LCE vs the current spot price of US$9.80k/t

TNR owns a 1.35% NSR in the project, of which, Ganfeng has an option to purchase 0.90% for $0.9M. We believe Ganfeng will exercise its option, thereby reducing TNR’s interest to 0.45%. We are projecting annual royalty revenue of $1M for TNR at current spot lithium prices.

Unlike typical lithium miners, Ganfeng’s Mariana production is relatively protected from low spot prices and volatility due to vertical integration that feeds its own downstream plants, and strong state support as a leading lithium producer in China.

Los Azules Copper-Gold-Silver Project, Argentina (0.36% NSR)

This advanced stage porphyry copper project is 100% owned by McEwen Inc., a group led by McEwen Mining (NYSE: MUX), Stellantis (NYSE: STLA/the owner of auto brands such as Fiat, Maserati, and Chrysler), Rio Tinto (LSE: RIO), and Rob McEwen. 

In March 2025, McEwen completed an 11,000-meter drill program in preparation for its upcoming resource update and feasibility study (FS).

Located in the prolific Andes copper belt, 90 km north of Glencore’s (LSE: GLEN) El Pachon project. Los Azules is one of the largest undeveloped copper projects in the world, with resources totaling 38 Blbs copper, 4.7 Moz gold, and 159 Moz silver, suitable for open-pit mining 

A PEA returned an AT-NPV8% of US$2.9B, using US$3.75/lb copper vs the current spot price of US$5.83/lb 

To date, McEwen has completed 209,000 m of drilling. We note that the deposit has significant resource expansion potential as mineralization is open along strike, and at depth. Additionally, recent exploration and drilling have identified seven new exploration targets 

Management aims to begin construction in 2026, and commence commercial production by 2029. Using our long-term copper price forecast of US$3.50/lb, we estimate TNR could generate $6M in annual royalty revenue from this project, and up to $10M at current spot prices.

Shotgun Gold Project, Alaska (90% interest)

This property hosts a medium-sized/relatively high-grade/shallow deposit, with inferred resources totaling 0.71 Moz (1.06 gpt) on one of five identified targets. 

TNR is seeking an option/JV partner to advance the project to a PEA, and plans to spin out the project. 

Located 190 km from NovaGold and Barrick’s Donlin gold project (45 Moz in resources at 2+ gpt) – one of the largest undeveloped gold deposits in the world; Donlin has experienced delays due to strong opposition from local groups

As Shotgun is much smaller, we anticipate a smoother permitting process

Financials

As a royalty company with no immediate plans to explore the Shotgun project, TNR keeps its burn rate low. In-the-money options can bring in $1.13M

FRC Projections and Valuation

Based on an average EV/Resource of $66/oz (previously $53/oz) for gold juniors, we arrived at a fair value estimate of $0.15/share (previously $0.13/share) on the Shotgun project

Given the commencement of production at Mariana, we are raising our fair value estimate on its royalties by 19% to $0.05/share

Using a sum-of-parts model, we arrived at a fair value estimate of $0.30/share on TNR (previously $0.28/share)

Our valuation remains sensitive to metal prices

We are reiterating our BUY rating, and adjusting our fair value estimate from $0.28 to $0.30/share. TNR’s exposure to two advanced-stage, near-production assets—Mariana and Los Azules—positions it well for significant royalty income growth, with potential annual revenue of up to $11M based on current commodity prices. The company's low burn rate, improving lithium market dynamics, and Argentina's investment incentives further de-risk its portfolio. Key upcoming catalysts include initial royalty payments, a feasibility study on Los Azules, and the potential for a JV at Shotgun.

Risks 

We are maintaining our risk rating of 5 (Highly Speculative)

We believe the company is exposed to the following key risks (not exhaustive):

1. Commodity prices
2. Potential for delays in attracting a partner for Shotgun
3. Exploration and development 
4. No assurance that its partners will advance their projects within expected timelines 
5. Access to capital and share dilution