Tudor Gold’s PEA: 4 Tests That Determine If Treaty Creek Is Buildable

Tudor Gold has assembled one of the largest undeveloped gold resources in North America, with nearly 25 million Indicated ounces sitting in the Goldstorm deposit at Treaty Creek. For most junior miners, a resource of that magnitude would be the story. For Tudor Gold, it has historically been the problem.

A deposit this large invites a development concept that requires multi-billion-dollar capital, a scale no junior can finance without either surrendering control to a major or diluting shareholders into irrelevance. The 2026 Mineral Resource Estimate (MRE), prepared by Garth Kirkham, P.Geo., of Kirkham Geosystems Ltd. under NI 43-101 standards (Canada’s reporting framework for mineral projects), formalises Treaty Creek’s resource. More importantly, it introduces the cut-off sensitivity data that underpins a different approach: an underground starter operation targeting the high-grade core, designed to make the project financeable in stages.

The Preliminary Economic Assessment (PEA) being prepared by Fuse Advisors Inc., targeted for Q3 2026 completion, is the first rigorous test of whether that reframing holds. Here is what the resource actually shows at different grade thresholds, why the underground pivot is structurally rational, what the metallurgy confirms, and exactly what the PEA must demonstrate for the thesis to survive contact with the numbers.

What nearly 25 million ounces actually means at Treaty Creek

The headline figure is worth anchoring on before pulling it apart.

24.9 million Indicated ounces of gold, contained in 912.3 million tonnes grading 0.85 g/t gold, alongside 148.7 million ounces of silver and 3.048 billion pounds of copper, at a base cut-off of US$50/t net smelter return (NSR). The Inferred category adds a further 4.0 million ounces of gold.

That is a genuinely large deposit in a tier-one jurisdiction. The question is what it looks like when you raise the economic bar.

The MRE includes cut-off sensitivity tables, which show how the resource changes when only higher-value material is counted. These tables are not a technical footnote. They are the analytical foundation for the underground development concept, and they reveal a meaningfully different deposit at higher thresholds.

Applying the US$125/t NSR threshold strips the Indicated resource back to 102.1 million tonnes grading 1.78 g/t gold, with contained metal of 5.8 million ounces of gold, 30.2 million ounces of silver, and 607.2 million pounds of copper. Raising the bar further to US$175/t yields a tighter envelope of 45.1 million tonnes grading 2.33 g/t gold, holding 3.4 million Indicated ounces.

The higher-grade core at the US$125/t threshold, roughly 5.8 million ounces at nearly double the bulk average grade, is what makes an underground starter operation analytically coherent rather than aspirational. Investors who anchor on the 24.9 million ounce headline without interrogating how grade distributes inside that total will misjudge both the opportunity and the risk. The 25 million ounces is a ceiling figure. The underground thesis rests on a smaller, higher-margin subset.

Rigorous mining exploration due diligence applied to a resource of this scale goes beyond grade and tonnage, requiring investors to interrogate the grade distribution, metallurgical characterisation status, and capital cost assumptions that determine whether a large resource can be developed economically.

Why Tudor is building underground rather than waiting for a major to take over

The structural problem is straightforward. A large-scale open pit in remote British Columbia typically requires multi-billion-dollar upfront capital for access roads, processing infrastructure, tailings facilities, power, and camp facilities. A junior developer without cash-flowing operations cannot finance that level of spend without either flooding the share register with equity or ceding project control to a major partner. Either path destroys value for existing shareholders.

Tudor’s underground pivot is not a reduced-ambition strategy. It is a capital discipline strategy. The full 24.9 million ounce resource is not abandoned; it is staged. By targeting the higher-grade zones via an underground operation first, the company aims to build a smaller, more selective starter mine with materially lower initial capital. The full resource remains available for future expansion, potentially once cash flow from the underground operation helps fund it.

For investors evaluating dilution risk, this matters directly. An underground-first path is designed to support project-level financing through a mix of debt, streaming or royalty arrangements, and a manageable equity component, rather than the shareholder-of-last-resort equity raises that large open-pit developments have historically required from juniors.

The capital structure logic for an underground-first path depends heavily on streaming and royalty arrangements, which allow a developer to monetise future production at a discount today in exchange for upfront funding that avoids the shareholder dilution that equity-only raises produce.

Permitting status and timeline

An underground ramp permit application was filed with the British Columbia regulator in August 2025. Tudor has indicated it expects to receive ramp approval and commence excavation in 2026, with related exploration permits already valid through May 2030. The ramp targets the high-grade SC-1 “Supercell-1” complex and Goldstorm zones, with four stated functions:

• Year-round underground access independent of seasonal constraints
• Drill platforms for definition and expansion drilling
• Support for underground definition drilling to refine high-grade domains
• Future mine development access for the underground operation

The PEA, being prepared by Fuse Advisors Inc. with a target Q3 2026 completion, will frame the staged underground development path and provide the first economic test of whether the capital structure logic holds.

What the metallurgy actually confirms, and where the technical risk remains

Metallurgical work at Treaty Creek has established that conventional sulphide flotation is sufficient to produce commercially saleable gold and copper concentrates, with no requirement for pressure oxidation or bio-oxidation circuits.

That single finding removes one of the largest capital and complexity risks from the development equation. Deposits requiring specialised oxidation circuits carry a capital and regulatory penalty that can make otherwise attractive resources uneconomic at the PEA stage. Treaty Creek’s conventional route is a genuine positive signal.

A consistent primary grind of approximately 120 microns works across both characterised zones, which supports a single, relatively simple processing circuit design. That is directly relevant to the PEA: a simpler circuit means lower capital cost and fewer permitting complications.

Flotation work on the SC-1 zone, one of the two principal underground targets, returned a gold recovery of 85.1% and a concentrate grade of around 33.6 g/t gold, figures that sit comfortably within commercially saleable ranges. Testing on the Lower CS-600 zone generated a concentrate grading 30.3% copper, 36.5 g/t gold, and 99.8 g/t silver, with the copper recovery measured at 85.8%.

The 85.1% gold recovery from the SC-1 zone looks commercially sound when viewed against flotation recovery benchmarks for comparable gold-copper porphyry deposits, where conventional flotation typically delivers recoveries in the 78%-90% range depending on ore complexity and grind size.

Where characterisation gaps remain

Not every zone at Goldstorm has been fully tested. Two zones represent outstanding technical risk:

• CBS Zone: metallurgical characterisation incomplete
• Perfectstorm PSP Zone: metallurgical characterisation incomplete

These gaps matter because the PEA’s scope and economics depend on which zones are included in the mine plan. The two principal characterised zones (CS-600 and SC-1) cover the core underground starter scenario, but any expansion beyond those zones requires further metallurgical work before engineering assumptions can be made with confidence.

Four tests the 2026 PEA must pass for the underground thesis to hold

The PEA is not a milestone to celebrate. It is a scorecard to evaluate. Each of these four tests maps to a risk that could prevent a commercially attractive resource from becoming a financeable project.

CSA Staff Notice 43-307 on PEA disclosure draws a clear regulatory line between a PEA and a Pre-Feasibility Study, which matters when interpreting what economic confidence level the Fuse Advisors report can legitimately claim under NI 43-101.

If the PEA demonstrates manageable initial capital, competitive operating costs, a clear mine design targeting high-grade zones, and a credible financing pathway, it would validate the underground thesis and reposition Treaty Creek from “world-class resource on paper” to “buildable, financeable project.”

1. Capital cost discipline. This is the most important test. The entire rationale for the underground pivot rests on lower upfront capital. If initial capex still approaches multi-billion-dollar levels, the junior-financeable thesis collapses. Investors should be looking for a number that can plausibly be covered through project-level debt, streams, royalties, and a manageable equity raise.
2. Competitive all-in sustaining costs (AISC). Underground mines carry higher fixed costs per tonne than open pits, so the economics depend on whether the grade and throughput assumptions in the mine schedule deliver margins that work at conservative gold prices. The cut-off sensitivity data (the US$125/t and US$175/t NSR grade profiles) are the inputs the mine schedule must honour to deliver underground-appropriate margins.
3. Mine design clarity. Investors need to see which zones are targeted for initial stoping (SC-1, portions of CS-600), how production ramps up, and how the underground exploration ramp programme feeds into the development sequence. Clarity on timelines, sequencing, and permit dependencies is what distinguishes a credible mine plan from a concept sketch.
4. Financing strategy. A PEA that ignores funding structure or implicitly assumes 100% equity financing will raise red flags with sophisticated investors. The market will look for a credible mix of project-level debt, streaming or royalty arrangements, and equity, with market precedents or potential counterparties identified.

Having these four criteria defined before the PEA lands protects you from the common pattern of reacting to the headline net present value without stress-testing the assumptions beneath it.

Where Treaty Creek stands in 2026, and what investors need to watch next

The geological and metallurgical case at Treaty Creek is materially stronger than it was two years ago. The strategic logic of the underground pivot is sound. But the PEA is the gate that determines whether the asset moves from a world-class resource on paper to a buildable, financeable project. Investors should treat it as exactly that.

For an investor deciding whether to hold, add to, or exit a position in Tudor Gold (TSXV: TUD, Frankfurt: H56) ahead of the PEA release, the honest framing is this: geological and technical risk has improved materially, but execution risk (permitting, capital, financing) remains the dominant variable and will not be resolved until the PEA and, ultimately, a construction decision.

The Q3 2026 PEA release is the next material catalyst. When it lands, evaluate it against the four-test scorecard: capital cost discipline, competitive AISC, clear mine design, and credible financing strategy. If it passes all four, the investment case changes shape. If it falls short on any, the thesis needs revision, regardless of the headline NPV.

Investors exploring why British Columbia continues to attract large-scale gold and copper development capital will find our full explainer on BC mining’s economic significance useful, covering the provincial policy context and infrastructure conditions that shape development timelines for remote projects.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions. Past performance does not guarantee future results. Financial projections are subject to market conditions and various risk factors.