SLX: Osisko Gold Drilling Confirms New Gold System Near Cariboo

• Osisko Gold drilled 14 holes at the Proserpine target, confirming new high-grade gold mineralized system.
• Appian Capital Advisory provided a US$450 million senior secured loan.
• Initial drilling highlights intercepts of 95.93 g/t Au over 4.60 m, indicating potential for bulk or open-pit mining methods .
• Osisko Gold Royalties maintains a Moderate Buy consensus price target.
• The company operates as an incubator for junior miners.

Osisko Gold Group Inc. has announced initial diamond drilling results from its Proserpine regional greenfield target, located approximately seven kilometers southeast of its permitted Cariboo Gold deposit in central British Columbia . The exploration campaign, which completed 6,463 meters across 14 holes between February and May 2026, has confirmed a significant new gold mineralized system . The results reveal high-grade structures alongside broader zones of lower-grade mineralization, suggesting the potential for open-pit mining methods at the new target .

Drilling has expanded the known mineralized footprint at Proserpine to roughly one kilometer along strike by half a kilometer in width . Gold was encountered from near-surface depths to intervals exceeding 400 meters, with mineralization remaining open in all directions . Notable intercepts include 95.93 grams per tonne of gold over 4.60 meters at 71 meters vertical depth, which contained a high-grade interval of 873.00 grams per tonne over 0.50 meters . Other significant highlights include 5.46 grams per tonne over 8.60 meters and 2.17 grams per tonne over 14.45 meters at deeper vertical intervals .

Chris Lodder, President of Osisko Gold, stated that the results highlight the potential for a significant new gold mineralized system of scale located close to the Cariboo Gold deposit . The mineralization style at Proserpine exhibits similarities to the Cariboo deposit, featuring high-grade structures alongside broader zones of lower-grade mineralization that may indicate bulk mining potential . Following a seasonal hiatus, drilling has resumed with three active rigs . Osisko plans a further 26,500 meters of drilling to increase drill density at Proserpine Southeast and begin first-pass drilling at Proserpine Northwest .

How Is the Cariboo Project Financed?

Appian Capital Advisory has provided a US$450 million senior secured project loan to Osisko Gold to fund the development and construction of its permitted Cariboo Gold Project . The proceeds will be used to fund the development and construction of Osisko's flagship Cariboo Gold Project in British Columbia, Canada . This transaction marks a significant step in de-risking the project ahead of a final investment decision .

The facility includes a US$100 million initial draw, which enables Osisko to accelerate pre-construction activities . These activities include an infill drilling campaign, detailed engineering, procurement, underground development, and operational readiness planning . The remaining US$350 million is available for subsequent draws upon a final investment decision, subject to customary project milestones and conditions precedent .

The Cariboo Gold Project is described as permitted and near-construction ready . According to the 2025 Feasibility Study, the project has the potential to deliver 1.89 million ounces of gold over a 10-year mine life . Osisko Gold aims to become an intermediate gold producer by advancing this 100%-owned asset . The project benefits from the company's focus on past-producing mining camps in mining-friendly jurisdictions with district-scale potential .

Why Do Analysts Favor Osisko Gold Royalties?

Osisko Gold Royalties Ltd (TSE:OR) has received a consensus recommendation of Moderate Buy from six covering analysts . The average 12-month price target is C$63.20, implying significant upside from the stock's reported price of C$45.07 . Recent analyst actions include Canadian Imperial Bank of Commerce lowering its price objective from C$88.00 to C$85.00, while Stifel Nicolaus increased its target from C$70.00 to C$71.00 and issued a buy rating .

Financial metrics indicate a market cap of C$8.45 billion with a P/E ratio of 33.63 and a PEG ratio of 1.31 . The company reported strong quarterly results with C$0.46 EPS, C$138.98 million in revenue, an 82.42% net margin, and 19.91% return on equity . Balance sheet strength is evident with a low debt-to-equity ratio of 0.31 and a current ratio of 4.11 .

From a valuation perspective, the stock trades at approximately 1.1x NAV, making it cheaper relative to major producers like Agnico Eagle Mines . Market commentary highlights the company's transition to a pure-play royalty streamer, shedding conflicts with Osisko Mining . A new CEO has addressed previous management issues, and the company benefits from a portfolio anchored by a 3-5% net smelter return royalty on the Canadian Malartic Complex .

Osisko Gold Royalties operates as an intermediate precious metal royalty company focused on the Americas . The company differentiates its business model from pure royalty players by functioning as an incubator and accelerator for junior mining companies . Osisko provides financing via equity alongside expertise in management, geology, and engineering . This strategic approach aims to accelerate the development of junior mines, thereby triggering royalty payments faster .

The company holds a North American-focused portfolio of over 135 royalties, streams, and precious metal offtakes . Its cornerstone asset is a 5% net smelter return royalty on the Canadian Malartic mine, Canada's largest gold mine . Additional holdings include the Cariboo gold project and equity stakes in related entities such as Osisko Mining Inc., Osisko Metals Incorporated, and Falco Resources Ltd . The firm maintains a strong financial position and distributes quarterly dividends to shareholders, benefiting from its regional focus on stable jurisdictions in Canada and the United States .

While insider transactions show recent selling by directors, the broader analyst view remains positive on the company's organic growth potential and exposure to rising gold prices . The company's dual focus on royalty income and equity appreciation in junior miners provides a unique risk-reward profile for investors seeking exposure to North American gold development .