Foran Mining secures C$70M in Saskatchewan tax credits

Foran Mining (TSX: FOM) says it has secured up to C$70 million in Saskatchewan provincial tax credits to support the development of its McIlvenna Bay project in the Flin Flon greenstone belt.In a press release Thursday, Foran confirmed that its polymetallic project officially became part of Saskatchewan’s Critical Minerals Processing Investment Incentive (CMPII) program. Launched a year go, the CMPII represents one of two new government initiatives aimed at boosting the production of 11 designated critical minerals, including copper and zinc, within the province.The McIlvenna Bay project hosts the region’s largest massive sulphide deposit, containing 39 million indicated tonnes grading 1.2% copper and 2.16% zinc, containing 1 billion lb. of copper and 1.9 billion lb. of zinc. About 70% of the contained metals are probable mineral reserves.The project reached the feasibility stage in 2022, with a report outlining an 18-year mine capable of producing an average 34.5 million lb. of copper and 58.6 million lb. of zinc annually. It defined a capital cost totalling C$368 million for the initial phase, translating to $0.24/lb. copper equivalent. However, that cost estimate has since risen significantly, with Foran now projecting over C$1 billion for the Phase 1 build.Shares of Foran Mining jumped as much as 5.5% to C$3.39 on the announcement, giving the Vancouver-based mine developer a market capitalization of C$1.7 billion.Mid-2026 productionConstruction of the project began in July 2024, and Foran recently said it has surpassed the halfway mark, placing it on track and budget for a mid-2026 production.To meet the construction timeline, management is banking on C$645 million in cash net of payables, credit facilities of C$153 million, a C$25 million federal Strategic Innovation Fund contribution, and a Critical Minerals Infrastructure Fund grant of up to C$15 million, plus investment tax credits of $10 million.From June 2024 to the end of first quarter 2025, the company has incurred approximately C$381 million of costs toward its Phase 1 capital budget, resulting in remaining cost to completion of C$701 million.Credits in 2027Projects under the CMPII program are eligible to earn royalty tax credits equivalent to 15% of specifically recognized project costs incurred up to a defined date. In McIlvenna Bay’s case, this would be C$70 million, which can either be applied to offset future payments due under Saskatchewan’s Mineral Crown Royalty Tax or potentially monetized through the sale to third parties.Once a project reaches completion, the CMPII royalty credits are calculated based on incurred eligible costs and earned over a three-year period: (20% in Year 1, 30% in Year 2, and 50% in Year 3). Should McIlvenna Bay begin production next year as planned, Foran is expected to earn these credits in 2027. “The CMPII program is a tangible example of Foran pursuing innovative initiatives to optimize our financial position, support future deleveraging and deliver value to stakeholders,” Foran’s chief financial officer James Steels stated in a press release.“Our government is proud to support companies like Foran who are helping us make progress towards our goals in Saskatchewan’s Critical Minerals Strategy,” Minister of Energy and Resources Colleen Young added. “Programs like the Critical Minerals Processing Investment Incentive have been successful in showing industry partners that Saskatchewan is the best place in the world for mining investment.”Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com