Interview with
Alex Black, Executive Chairman of Rio2 Ltd.
Frederick H. Earnest, President & CEO of Vista Gold

Recording date: 13th June 2025

Two prominent gold development companies are pioneering a new approach to mine development, scaling down their flagship projects to achieve self-funded construction rather than waiting for major mining company buyouts despite gold prices reaching historic highs above $3,200 per ounce.

Rio2 Limited and Vista Gold Corp have both restructured their development strategies, prioritizing buildable projects over large-scale operations requiring external financing. Rio2's Fenix Gold project in Chile has been redesigned for initial production of 100,000 ounces annually from a 20,000 tons-per-day operation, while Vista Gold's Mount Todd project in Australia targets 150-200,000 ounces annually from 15,000 tons per day – a significant reduction from previously contemplated 50,000 tons-per-day operations.

The strategic shift reflects a fundamental change in market dynamics. Major mining companies are showing minimal interest in acquiring development-stage projects, preferring to purchase producing assets despite having record cash levels. "Gone are the days where you build a story up and tell everybody that you're going to flip the company and sell it to somebody," explained Rio2 CEO Alex Black. "The chances of somebody coming along and buying you out is very slim in this market."

Both companies have simplified their technical approaches to reduce capital expenditure. Rio2 eliminated crushing circuits in favor of run-of-mine operations, while Vista Gold reduced ore sorting from two stages to one, accepting marginally lower recovery rates for significantly reduced upfront costs.

The companies have incorporated future expansion capabilities into their designs, with Rio2 planning eventual expansion to 80,000 tons per day and Vista maintaining flexibility for larger operations. However, both emphasize proving operational capability first before pursuing growth capital.

This self-reliant development model represents a paradigm shift in the gold sector, where companies must demonstrate cash generation and operational success before attracting premium valuations or strategic partnerships, fundamentally altering the traditional development-to-acquisition timeline.

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