Mineros Just Went Shopping in Chile

Forwarded this newsletter? Subscribe Now! (It’s Free) 🚀

When I first wrote about Mineros S.A., I called it what it is — a 30% free cash flow machine trading like nobody’s watching:

They produced 213,245 ounces of gold in 2024.

All-in sustaining costs were US$1,551 an ounce while selling at over US$2,380 an ounce.

US$86.8 million in free cash flow, up 76% year-over-year.

A company generating more cash than most juniors will ever see, yet valued at a fraction of NAV.

That was the setup.

Fast forward to 2025, and guidance is in line with 2024 production, but the big shift is in cost structure, especially at Nechí, where cash costs drop by $500–$600 an ounce, thanks to royalty changes.

So I’d expect 2025 to appear even stronger, and we’ve now seen that theory start to prove accurate as they just announced a blockbuster Q2:

Now, they’ve just layered on a major potential catalyst for “Phase 2” of their growth… or at least that’s what I’m calling it.

And what is that you might ask?

Well, that’s the move from 300,000 ounces to 500,000 ounces.

Part of the company’s long term plan.

And I say 300,000 to 500,000 because within their existing sites they have a plan to ramp to 300,000.

But, they’re low-ish on resource, insert…

The Chile Catalyst

Mineros has agreed to buy 80% of the La Pepa gold project from Pan American Silver for US$40 million, giving them 100% ownership.

Closing is expected by September 30, 2025.

But, this isn’t some “maybe we’ll drill it one day” land package.

La Pepa already holds a sizeable resource of 1.15M ounces measured, 1.04M ounces indicated, and another 366,000 ounces inferred, for a total of over 2.5M ounces to start.

And, Mineros must have a pretty good line of sight on what they think they can grow it to, before they launch a PEA, as US$40M is no chump change.

The deposit is a porphyry-epithermal system that’s heap-leach friendly, in the Maricunga Gold Belt, one of Chile’s most productive mining districts.

No production yet, but once this closes, Mineros plans to dust off the October 2021 resource estimate and complete a PEA based on that data.

That’s when the market will have to start baking in numbers, I would think.

For 2025, Mineros is guiding 201,000–223,000 ounces of gold from its Colombian and Nicaraguan operations, and Sprott (although an older report) is saying 282,000 ounces for 2026.

Layer La Pepa onto that and even a modest 10–20% bump in production could have a massive impact.

But what’s really important, is it more than doubles their total resource, from my calculations.

A smart move for $40M.

Mineros S.A. – Mine Resource & Production Overview (Updated 2025)

Ounces are combined Measured, Indicated, and Inferred as of Dec 31, 2024 (except La Pepa, 100% as of Aug 2025). 2024 production from AIF. Nechí and Hemco are main producing assets; Guillermina and La Pepa are growth projects.

Also to be clear, the reason there is no resource for the The Bonanza Model is because they simply buy ore from local miners, then process it. That’s why their AISC is so low, as they’re not actually mining, just processing. It’s great for cash flow now but doesn’t provide long-term resource security, which is why Mineros has been buying assets like La Pepa to lock in future ounces.

This chart makes two things crystal clear:

1. They’ve doubled their total resource base in one shot with the La Pepa acquisition.

2. They’re producing serious cash today, even before La Pepa or any additional expansion ounces come online.

With gold above US$3,000 an ounce, the economics get wild.

At the 202,000 ounce baseline and $1,940 ounce AISC, (which we think will drop quite a bit further) free cash flow in 2025 could approach US$277M (~C$376M) — a 47% FCF yield on an ~$800M CAD market cap.

Layer in Sprott’s 2026 projection of 282,000 ounce, plus eventual La Pepa output, and you’re looking at a potential 350,000–400,000 ounce annual producer.

And remember, these guys already run at a 30–35% free cash flow.

Now they can fund growth without constantly coming back to the market…

Funding through cashflow is one of the best things you can do for shareholders as obviously it avoids dilution.

This $40M came from exactly that, cashflow.

Which, I mean… have a look yourself.

Mineros hasn’t issued a single new share since its public offering in November 2021, keeping the share count locked at roughly 299.7 million for nearly four years.

Not to mention they just announced an up to USD$12M share buyback that’ll start soon.

I have never seen that before, especially in the mining world.

An extremely rare streak of zero dilution.

If that’s not a management team you’d want to bet on, I don’t know what is.

And that is how you get sustained re-rates in the sector, and have one investor to buy 196 million shares of your Company.

What’s Next

We won’t see ounces from La Pepa in 2025, or maybe even 2026, as this is still an exploration-stage asset.

But that’s the point.

They knew they needed to add ounces, and now they have, for cheap.

And the PEA will be the first real look at its potential.

Meanwhile, the core business keeps spitting out serious cash and delivering on guidance and delivering dividends.

Where I’m Going With This…

Now, if gold holds above US$3,000 an ounce, and La Pepa economics line up and turn into reserves, Mineros could be looking at a very different valuation during 2026 and beyond.

The market hasn’t woken up to it yet, but when those numbers hit, that could change fast.

And the lack of resource at the Bonanza operation is primarily why it trades at such a discount to peers.

But, lets look at the numbers quickly before I wrap this one up.

Free cash flow (USD)

202,000 ounces × ($3,313 per ounce – $1,940 AISC) = 202,000 × $1,373 = US$277,346,000 or CAD $376,180,000.

That gives us a FCF Yield (vs. CAD $800M market cap) of 376.18M / 800M = 47.0%.

A 47% FCF machine.

Imagine once they ramp to what Sprott says at 282,000 ounces, or they get another 100k ounces online from La Pepa and they’re approaching 400,000 ounces, this company won’t be trading at $800M for long, it would be a lot, lot higher than that.

We’d be more like a $2-3B company, IMO.

But they need more resources in the ground.

Which they’re also executing on via exploration, so they get it:

I’ll be watching for the September close of this 80% purchase, the PEA, further exploration updates, and any early hints on 2026 production guidance.

As always, Happy Hunting!

Subscribe Now (It’s Free) 🚀

About The Net Worth Club

Welcome to The Net Worth Club — a no-fluff, high-conviction investing newsletter written for people who want to grow their wealth intelligently and aggressively.

Every week, I break down actionable opportunities across the stock market, private deals, and the global economy — all with one goal in mind: help you multiply your net worth.

You’ll get:

✅ Deep dives on overlooked companies with potential to double (or more)
✅ Real-time trade ideas and portfolio updates — I eat my own cooking
✅ Market psychology, timing strategies, and hard-earned lessons
✅ A front-row seat to how I’m building serious wealth — and helping others do the same

This isn’t financial fluff or recycled headlines. It’s boots-on-the-ground insight, from someone who's in the trenches — raising capital, taking companies public, and making real bets with real money.

If you’ve ever thought: "I just want someone sharp to help me spot the big moves early" — this is for you.

👇 Subscribe now and start compounding smarter:

Read more previous stock picks:

$TSLA ( ▲ 0.62% ) at $180 before moving to $480

$SOFI ( ▲ 0.23% )  at $6.00 before moving to $22.00

$INVZ ( ▲ 18.33% )  at $0.74 before moving to $3.00