Onyx Gold's Strategic Financing Fuels Exploration Ambitions in Canadian Mining Hubs

Onyx Gold Corp. has embarked on a significant capital-raising campaign in 2025, leveraging the strategic advantages of flow-through shares to fuel exploration in two of Canada's most prolific gold regions: the Timmins mining camp in Ontario and the Selwyn Basin in the Yukon. The company's recent private placements, totaling over $15 million when including warrant exercises, reflect a deliberate strategy to advance high-grade gold projects while minimizing the net cost of exploration through tax incentives. This financing not only underscores investor confidence but also positions Onyx to capitalize on a potential renaissance in Canadian gold exploration.

The Financing Structure: Maximizing Capital Efficiency

Onyx executed two private placements in Q2 2025: a bought deal raising $8.04 million and a non-brokered placement that brought total proceeds to $13.04 million. The inclusion of flow-through shares (FT Shares) was central to the strategy, allowing the company to channel funds toward “Qualifying Expenditures” for exploration by December 31, 2026. These expenditures must be renounced to FT Share subscribers by the end of 2025, ensuring investors receive tax credits tied to their investment.

Crucially, the use of FT Shares reduces Onyx's net exploration costs by up to 30%, as the tax benefits are effectively passed through to investors. This mechanism is a hallmark of Canadian mining financing, enabling companies to stretch capital further in a sector where exploration budgets often exceed $100 million for major projects.

The final tranche of the non-brokered placement, closed on June 6, 2025, added $2.03 million to the coffers. Notably, an existing strategic investor now holds 9.4% of Onyx's shares, signaling long-term confidence in the company's projects and execution. This investor's participation, alongside the broad use of flow-through financing, suggests a focus on attracting capital that aligns with both growth and tax efficiency.

Strategic Capital Allocation: Targeting High-Grade Assets

The funds will primarily support two projects:
1. Ontario's Timmins Region: Onyx's Munro-Croesus Gold property lies within the Timmins mining camp, a world-class district with over 100 million ounces of gold production. Recent drilling here has intersected high-grade gold zones, including 13.8 g/t over 2.5 meters, demonstrating the property's potential to expand reserves.
2. Yukon's Selwyn Basin: This underexplored region has seen renewed interest after recent discoveries by peers like Kaminak Gold. Onyx's projects here, including the Golden Mile and Timmins South, target similar structural settings that host multi-million-ounce deposits.

The Selwyn Basin in particular is a frontier area with limited historical drilling, offering significant upside for companies like Onyx that can secure exploration rights. Meanwhile, Timmins' established infrastructure reduces operational risks, making it an attractive base for near-term drilling campaigns.

Risks and Considerations

Despite the strategic merits, risks remain:
- Renunciation Deadlines: Missing the December 31, 2025, deadline to renounce expenditures could force Onyx to indemnify investors for tax penalties, potentially straining liquidity.
- Regulatory and Geological Uncertainties: Exploration in the Yukon faces permitting hurdles and the inherent risks of drilling in unproven terrain.
- Commodity Price Volatility: Gold prices have fluctuated between $1,500–$2,000/oz over the past year (). A sustained dip below $1,600 could reduce the economic viability of some projects.

Investment Analysis: A Play on Canadian Gold Exploration

Onyx's financing structure offers a compelling entry point for investors willing to take on moderate risk in exchange for exposure to high-potential gold assets. The flow-through mechanism lowers the effective cost of exploration, increasing the likelihood of drill results that can re-rate the stock. Meanwhile, the involvement of a strategic investor at a 9.4% stake provides a vote of confidence that may attract institutional follow-on capital.

For conservative investors, the renunciation obligation and indemnification clause introduce counterparty risk. However, for those bullish on gold and Canadian mining—particularly in established hubs like Timmins—Onyx's projects represent a leveraged position in a sector primed for growth.

Conclusion: A Strategic Move with Upside Potential

Onyx Gold's $15 million financing round is a masterclass in capital allocation for an exploration-focused miner. By tapping into tax-efficient flow-through shares and securing a committed strategic partner, the company has positioned itself to advance projects in two of Canada's most promising gold regions. While risks remain, the alignment of geology, infrastructure, and financing suggests Onyx could become a key player in the next wave of Canadian gold discoveries. Investors with a long-term horizon and tolerance for exploration risk may find this a compelling opportunity to participate in the next chapter of the Timmins and Selwyn Basin stories.