Alamos Gold's High-Grade Strategy: Unlocking Value at Island Gold

TORONTO, ON – June 22, 2026 – In the world of mineral exploration, a high-grade discovery is always cause for excitement. But when a series of high-grade hits systematically unlock potential across an entire district, it signals something more profound than a lucky strike. It points to a deliberate strategy. Alamos Gold’s latest exploration results from its Island Gold District in northern Ontario are a textbook example of this, revealing a multi-pronged approach to feeding a larger, more efficient operation that is poised to become one of Canada’s most significant gold producers.

The company today announced a string of successful drill results, defining new zones of high-grade gold mineralization and extending known ones. These discoveries are not random dots on a map; they are strategically located targets intended to serve as additional sources of high-quality ore for the expanded Magino mill. The explicit goal is to increase the proportion of rich ore feeding the processing plant, a critical lever for driving down costs and maximizing output.

As Alamos President and CEO John A. McCluskey stated, “With multiple higher grade targets being defined within proximity to the Magino mill, and an expansion underway that will provide more than enough mill capacity, we see excellent potential to drive production higher by further increasing the proportion of higher-grade ore that will be processed within the expanded circuit.”

The High-Grade Advantage: A Strategy Takes Shape

For any mining operation, grade is king. The concentration of gold within the ore dictates the entire economic equation. Processing lower-grade material means moving and milling more tonnes of rock to produce a single ounce of gold, which directly impacts energy consumption, labor, and overall costs. By focusing its exploration efforts on identifying and defining high-grade zones, Alamos is executing a clear strategy to optimize its value chain from the rock face to the gold bar.

This strategy is anchored by the ongoing expansion of the Magino mill, a cornerstone of the broader Island Gold District (IGD) Expansion project. A larger mill is only as good as the material it processes. By securing a pipeline of high-grade ore, Alamos de-risks this major capital investment and ensures it can run at peak efficiency. The company’s commitment is underscored by a significant increase in its exploration budget, which has climbed to $43 million for 2026, up from $24 million in 2025. This isn't just spending more; it's a targeted investment in resource quality to fuel future profitability.

The February 2026 Expansion Study for the district already painted a compelling picture, projecting average annual production of 534,000 ounces at a competitive all-in sustaining cost (AISC) of $1,025 per ounce. Today's results provide further confidence in that vision, suggesting a robust and diversified ore supply to sustain that level of production for years to come.

Unlocking the District: Beyond the Main Deposit

The latest drilling success is notable for its breadth, demonstrating potential across several distinct areas. This diversification of ore sources is critical for operational flexibility and long-term sustainability.

A key highlight is the definition of a brand-new zone, the Island Gold West Extension. Located 250 metres west of existing resources, this 200-by-300-metre zone has yielded impressive intercepts like 12.05 grams per tonne (g/t) of gold over 5.20 metres. Crucially, the zone remains open for further expansion, representing a significant new frontier for resource growth in an area that has seen little historical exploration.

Meanwhile, in the Island West up-plunge area, drilling is extending mineralization closer to the surface. This has a direct operational benefit: this ore can be accessed via the existing ramp system, supplementing the main shaft. This creates a flexible, dual-access system that could allow underground mining rates to exceed the 3,000 tonnes per day planned for the shaft, further optimizing the flow of high-grade material to the mill.

Adding another layer of value, exploration has successfully targeted hanging wall structures—zones parallel to the main deposit. The newly defined NS1 and NS4 zones are close to existing underground infrastructure, making them low-cost development opportunities. The NS4 zone, in particular, delivered a spectacular intercept of 132.90 g/t gold over 2.21 metres. Discoveries like these are the mining equivalent of finding a new revenue stream right next to your main factory, requiring minimal new infrastructure to bring online.

Reviving the Past for Future Gains: The Regional Play

Perhaps the most strategically compelling aspect of the recent news is the success of the regional exploration program. Alamos is breathing new life into the past-producing Cline-Pick and Edwards mines, located just seven kilometres by road from the Magino mill. This 'brownfield' exploration approach is smart and capital-efficient. The historical production from these sites confirms the presence of gold-bearing structures, significantly reducing geological risk.

Recent drilling has followed up on a remarkable intercept from earlier this year (178.07 g/t Au over 3.54 m) with another exceptional result: 67.93 g/t gold over 3.05 metres, including a core of 127.72 g/t over 1.35 metres. These are not just trace amounts; they are bonanza grades that confirm the potential for a substantial, high-grade satellite deposit.

By proving out resources at these nearby sites, Alamos is developing a hub-and-spoke model where the central Magino mill can be fed by multiple high-grade sources. This diversifies production risk and extends the life of the entire district. Further success at the adjacent 88-60 Zone, which returned 24.12 g/t gold over 3.88 metres at a shallow depth, reinforces the immense potential of this consolidated land package.

These results are a powerful demonstration of a company methodically executing a well-defined plan. Rather than relying on a single large deposit, Alamos Gold is building a resilient, multi-source operation. Each new high-grade discovery, whether in a new extension, a parallel zone, or a revived historic mine, adds another layer of value and de-risks the company’s ambitious path to becoming a million-ounce producer, cementing the Island Gold District as a Tier 1 asset in the heart of Canada.