Centerra buys 9.9% of Midland in juniors spree

Centerra Gold (TSX: CG; NYSE: CGAU), a top-10 Canadian producer of the yellow metal, is continuing to invest in domestic gold juniors, this time with the acquisition of a 9.9% stake in Midland Exploration (TSXV: MD).

The share acquisition is part of a private placement arranged with institutional investors, Midland said on Tuesday. Under the offering, Midland will sell 3.18 million shares at a near market price of 33¢ per share, for gross proceeds of $1.05 million (US$740,000). Centerra is expected to participate in this offering.

Additionally, Midland is looking to sell about 10.7 million shares at a higher price of $4.75 each in a separate offering, for approximate proceeds of $5.06 million.

Shares in Midland Exploration closed 1¢ higher on Tuesday in Toronto at 35¢ apiece, giving the Quebec-focused gold explorer a market capitalization of $32.3 million. Centerra gained 8.8% to close at $10.44 apiece, valuing the company at $2.15 billion. 

“This placement will provide Midland with sufficient funds to ensure the progress and development of our wholly owned gold exploration projects in Abitibi, James Bay and northern Quebec,” Midland Exploration CEO Gino Roger said in a news release.

Centerra investing

Centerra has invested over the past year in a series of other junior explorers with gold properties across the country. These include Kenorland Minerals (TSXV: KLD), Ontario-focused Dryden Gold (TSXV: DRY), British Columbia-focused Thesis Gold (TSXV: TAU) and Quebec’s Azimut Exploration (TSXV: AZM), all with a 9.9% stake.

Midland holds a large portfolio of properties across these regions, with a focus on establishing joint ventures with established miners. To date, it has secured partnerships with global leaders BHP (NYSE, LSE, ASX: BHP) and Rio Tinto (NYSE, LSE, ASX: RIO), as well as Canadian household names like Agnico Eagle Mines (TSX: AEM; NYSE: AEM) and Wallbridge Mining (TSX: WM; US-OTC: WLBMF).

Centerra, a mid-tier Canadian gold producer, produced 368,104 oz. of gold last year split between its Mount Milligan mine in British Columbia and the Öksüt mine in Turkey. While its output trails the likes of Agnico Eagle and Barrick (TSX: ABX; NYSE: B), Centerra still ranks among the top 10 Canadian-listed gold producers by market capitalization and production.

Centerra operations

Centerra generated about 45% of its gold from Mount Milligan, a hybrid gold-copper operation that also yielded 54.3 million lb. of copper in 2024. Öksüt contributed the remaining 200,525 oz., following a resumption of full operations after a leach pad pause in 2022. All-in sustaining costs for the year came in at US$1,148 per oz., placing Centerra within the industry’s mid-cost range.

The company ended 2024 with US$625 million in cash and equivalents, no debt and a renewed focus on organic growth following past geopolitical challenges, including the nationalization of its former flagship Kumtor mine in Kyrgyzstan. 

The Toronto-headquartered miner also owns several development assets, including the Kemess project in B.C. and the Goldfield project in Nevada.