This article is a sponsored feature from Mining.com.au partner ESGold. It is not financial advice. Talk to a registered financial expert before making investment decisions.
In the Montauban historical mining district in Canada, ESGold (CSE:ESAU) is rewriting the narrative of a site long defined by toxic tailings.
With permits secured for a 1,000-tonne-per-day closed-circuit mill and drill rigs already on site, the company is advancing a dual strategy: reprocess historical waste to generate cash flow while simultaneously unlocking fresh exploration potential.
It’s a model that blends environmental remediation, near-term cash flow, and ambitious growth expectations, positioning ESGold at the intersection of restoration and discovery.
CEO Gordon Robb explains that the company has a unique opportunity in the Montauban township of Québec.
“There was a past-producing mine operational on and off from the early 1900s up until around 1990 that left significant tailings throughout the area,” Robb says.
“Our business model is to go in, reprocess these tailings, and use the cash flow generated from those sales to fund further exploration across the project.”
The historical exploration work was concentrated in one small area, going down to about 200m at depth, leaving ESGold with significant exploration upside.
The company is already kicking off its exploration campaign at the Montauban Gold-Silver Project, with rigs having arrived on site, all equipment en route, and construction and installation of the mill and facility now underway.
Unlocking Montauban’s hidden potential
ESGold’s strategy is to get the tailings generating cash flow before ramping up its exploration program, which will unlock significant upside in this underexplored region.
Robb explains that Montauban was previously an underground lead-zinc operation from around 1913 to 1944, with gold and silver as a byproduct. The project was mined extensively until it shut down after World War II for economic reasons, before operations resumed from 1948 to 1955.
From 1948 to 1955, the gold to silver ratio in the underground lead-zinc operation was 100 ounces of silver to 1 ounce of gold. In 1983, a company called Muscocho Explorations restarted work on the gold system itself. The resulting operation showed a ratio of 3 ounces of silver to 1 ounce of gold, highlighting how misunderstood the region and the system’s mineralisation has been.
On the tailings front, Robb notes that the three historical mining operations have left the company with 2.5–3 million tonnes of tails on site.
ESGold has defined a resource on 1 million tonnes of those historical tailings, which have an average grade of 0.4 grams per tonne gold and over 30g/t silver.
“This is tremendously economic today for gold, but it also shows that the silver grades are significant,” Robb says.
“If what’s left over is 30g/t in the tailings, then the silver grade from the mine itself was significant, in addition to the high-grade gold throughout the hard rock body.”
With these resources in hand, ESGold is now focused on execution.
Robb notes that the past year has been a whirlwind of capital raising for the company, which has received full funding for exploration, plus permits to run a 1,000-tonne-per-day operation. On top of that, ESGold has completed all of its procurement for the mill and is now onsite, waiting for equipment to arrive and working through installation.
This installation work is key to getting the tailings operation into production and generating cash flow.
As installation continues, the company is pushing forward with exploration and drilling. ESGold’s initial plan is to run geophysics across the project area to gain a better understanding of the size and depth of the system.
“This gives us significantly more options for further drilling and discovery potential for this historic underground lead-zinc mine,” Robb says.
“We also have a drill campaign scheduled for the next three months, with 5,000m of drilling along the surface crown pillar, which is where we have the historic resource.
“We’re going to be redefining this surface crown pillar, getting refamiliarised with our 3D model, and updating the drill plan.”
ESGold has relied heavily on the historical drilling and work completed at the site as it develops its geological model.
This next stage of modern exploration will provide the company with a better understanding of the geology and the ore body itself.
Robb notes that ESGold plans to couple that work with its ambient noise tomography (ANT) and geophysical surveys to target step-out holes where the company has identified anomalies to the north and south. The company has just commenced this planned drill program.
Restoration through reprocessing
Not only does the reprocessing of the tailings provide ESGold with near-term cash flow, it is also part of the company’s zero-waste mine strategy.
“This isn’t just tailings reprocessing for the sake of cash flow,” Robb says.
“This is environmental restoration work where we’re going to remediate the entire area, process these tails, then create an environmentally neutral aggregate after we extract the gold and silver doré.”
The tailings left on the surface at Montauban are an environmental liability that has gone unchecked for a hundred years, impacting the town of Montauban and its citizens.
With the reprocessing work that ESGold is planning, not only will the company be extracting the gold and silver to sell, but it will be neutralising the sulphides, cyanide, and other chemicals left behind and creating an environmentally neutral aggregate.
The tailings are to be processed through a closed-circuit system, with additives creating a P200 mesh material and an aggregate polymer. The end product can be used as construction material and in road building.
The goal for ESGold is to develop an environmentally friendly project without creating a toxic dry stack tailings site.
The Montauban township has been stuck with tailings for decades.
“If you drive through this town, you’ll see a house, then another house, then a tailings pile, then a house again. There’s a tremendous need to clean it up,” Robb says.
“Safe and environmentally friendly mining can also be done at the site. We have the technology, we have the funding in place, and we’re creating a safe, low-cost way to extract gold and silver without creating an additional environmental liability.”
Cash flow first, discovery second
ESGold’s path forward is going to be defined by execution. Procurement is complete, and installation of the 1,000-tonne-per-day mill is underway, with all equipment scheduled to be onsite within the next few weeks. The company is targeting a first gold/silver doré pour as fabrication and commissioning progress.
A 5,000m drill program has just commenced on the surface crown pillar, updating the historical resource model while testing step-out anomalies identified through geophysics. An updated ANT geophysical model and 3D geological model will also follow in the coming weeks, with drill results expected shortly thereafter.
Robb emphasises that ESGold is not following the typical ‘drill, dilute’ junior explorer path, but is instead leveraging the economic value of the tailings on surface to generate near-term cash flow, funding exploration without excessive dilution.
“Cash flow first, discovery second,” Robb says.
With gold and silver prices at current levels, ESGold expects strong margins from its low-cost tailings operation. Even in a weaker metals environment, the Montauban Project’s economics would remain robust given the low capital intensity of reprocessing. This positions the company to deliver shareholder value through exploration growth, potential dividends, or buybacks.
ESGold is on the cusp of becoming a producing company, with a sub-C$70 million ($70.5 million) market capitalisation, while advancing its exploration program. The company is not new, but it has a story you don’t hear every day, with a strategy focused not only on generating cash flow, but also on entering a toxic site and investing time and money in rehabilitation.
Ultimately, ESGold’s work at the Montauban Project is about restoring a legacy and turning environmental liability into a valuable opportunity. Its model combines near-term production with rehabilitation, with the cleaning of tailings becoming the foundation for new discoveries.
Write to Amy Rotman at Mining.com.au
Images: Mining.com.au, ESGold
