Lundin Gold Inc.

Lundin Gold Inc. is a mid-tier gold producer headquartered in Vancouver, Canada, operating primarily in South America. The company's portfolio consists of 1 operating mine, in addition to several early-stage exploration prospects. Key assets include Fruta Del Norte. The business model is centered on the production of both concentrate and doré bars, which are sold to a diverse global customer base of smelters, refiners, and traders. This dual-product approach provides market flexibility, and the company is not dependent on any single refiner or smelter, with sales based on international market-referenced prices. A key competitive advantage stems from operating a high-grade ore body, positioning the enterprise in the lower quartile of production costs relative to primary producers. The operational approach requires specialized technical expertise across geology, engineering, and metallurgical processing due to the remote nature of its activities. To mitigate supply chain risks, the organization maintains strategic inventories of critical machinery, parts, and reagents, ensuring operational continuity. The business is subject to commodity price cycles, which influence profitability and operational planning.

Strategic priorities are centered on a multi-faceted approach of organic growth, operational optimization, and disciplined capital allocation. A primary focus is expanding the resource base through aggressive exploration, evidenced by the execution of the company's largest-ever drilling program in 2024 to identify new opportunities within its extensive land package. Operational strategy involves enhancing efficiency and throughput, highlighted by the initiation of a process plant expansion project designed to increase processing capacity and improve metallurgical recoveries. The capital allocation framework emphasizes balance sheet strength and shareholder returns. This was demonstrated through a systematic debt reduction strategy completed in 2024, the establishment of a quarterly dividend policy in 2022 with subsequent increases, and the initiation of a normal course issuer bid in 2025. This approach balances reinvestment in growth with direct returns to shareholders.

Governance is structured around a 9-member Board of Directors supported by 5 standing committees: Audit, Compensation, Corporate Governance and Nominating (CGNC), Technical, and Health, Safety, Environment and Sustainability. The CGNC is responsible for board nominations, succession planning, and advancing diversity objectives, including a target of having at least 30% female directors. Executive leadership is provided by a President and Chief Executive Officer with tenure since 2004. The governance framework includes robust processes for managing potential conflicts of interest, particularly those arising from the influence of its 2 largest shareholders. This was demonstrated in 2024 when directors nominated by a major shareholder recused themselves from discussions and voting on a material transaction involving that shareholder. The Audit Committee, composed entirely of independent and financially literate members, provides direct oversight of financial reporting, internal controls, and auditor engagement.

The sustainability framework is guided by a 5-Year Strategy built on 8 pillars, including climate change, community well-being, and environmental stewardship. A key climate commitment is a target to achieve carbon neutrality for Scope 1 and 2 emissions by 2030, supported by annual reporting aligned with the Task Force on Climate-related Financial Disclosures (TCFD) since 2022. Social performance is managed through an Environmental and Social Impact Assessment compliant with International Finance Corporation (IFC) standards and an IFC-compliant grievance mechanism established in 2016. The company engages with local stakeholders via 5 active community roundtables. In 2024, a formal Human Rights Policy was adopted, guided by principles such as the UNGPs and UNDRIP. The organization also reports annually under Canada's legislation against forced and child labor, outlining supply chain due diligence and risk mitigation measures. Environmental protection is governed by a comprehensive licence covering all operational phases and conceptual closure.

The corporate ownership is characterized by 2 control persons: Newmont Corporation, which became a 32% shareholder in 2023, and the Lundin Family Trust. Under a subscription agreement, Newmont holds the right to nominate 2 directors to the board as long as its ownership remains above 20%. Operations are conducted through several wholly-owned subsidiaries, with Aurelian Ecuador S.A. (AESA) serving as the major operating entity, while Aurelianmenor S.A. (AMSA) and Surnorte S.A. hold exploration concessions. In 2024, the company completed a material transaction with Newmont, acquiring certain financing instruments for an aggregate price of $330 million, which extinguished the final piece of its original project financing. A key strategic partnership was altered in 2023 when an earn-in agreement with Newcrest (now Newmont) concerning the Surnorte concessions was terminated after Newmont elected not to exercise its option to acquire an interest.