Well, markets are closed today, but our next presenter is Galina Meleger, VP of Investor Relations for Skeena Golden & Silver , TSX, SKE. This market cap is huge. The chart on this thing is incredible. It's a leading precious metals development company focused on advancing the fully permitted Eskay Creek Gold-Silver Project located in British Columbia's Golden Triangle, Canada. Galina, unfortunately, was not able to join us today live, but was able to pre-record a presentation for us yesterday. If you have any questions, please type in the Q&A box, and I'll be sure to forward them off to Galina, and they'll get back to you. Enjoy Galina's presentation.
Okay. Good afternoon, everyone. It's so great to be back with the Kinvestor audience. We did this presentation last year as an update, and at the time, our share price was around CAD 15 per share. Today, we are trading at around CAD 40 per share on the TSX. I have to say it's been a really big and busy year for us. We've achieved some serious milestones, particularly as we commence 2026. This year, we announced the receipt of all of our permits to advance and develop Eskay Creek. We now have a clear line of sight towards production and cash flow in Q2 of 2027. I will be making some forward-looking statements, so you are duly cautioned.
Before we discuss the present, I always just like to take a step back and talk about the history of Eskay Creek because Eskay Creek is an iconic and legendary mine. It was formerly owned and operated by Barrick. It is a brownfield site. In its past life, it was an underground mine. It's iconic and legendary in the sense that it was the highest grade gold mine in the world. Barrick was processing gold north of 45 grams per ton, silver north of 2,000 grams per ton. Grades that are just unheard of, and they placed the mine on care and maintenance in 2008. If you recall, that was the global financial crisis. Gold was $600-$800 an ounce.
Because those grades, the ore was so rich that at one point they were just direct shipping it. They didn't even need a process plant. Then later when they did install a process plant, the cutoff grade was 15 grams per ton. That's what's really started the thesis for Skeena in trying to understand what could be left behind if the cutoff grade was 15 grams per ton. Today, we are reconceptualizing Eskay Creek as an open pit, and we are targeting some very sizable production. The average annual production rate in the first five years is about 450,000 ounces of gold equivalent metal. It continues to be one of the highest grade open pit mines globally, with a very high gold grade of about 5.5 grams per ton equivalent, again, in the first five years.
This is triple the global open pit average. When the grade is that good, the costs are also very good, so we are positioned towards the lower end of the industry cost curve. When the costs are that good, the cash flow is very robust. This will be a significant cash flow generator. At spot prices today with the falloff that we've seen at $48,000 gold and $76 per ounce silver, our annual after-tax free cash flow is about CAD 1.6 billion in years one through five. Construction is significantly advanced. We are on target for initial production in Q2 of 2027, and the project progress is approaching the halfway mark at the end of February of 2026. Maybe I'll just walk us through our permitting progress.
We're very proud of what we've achieved in this space. We're the first company in Canadian history that has had an indigenous government authorize our permits together with the province of BC. That was done through the landmark Section 7 agreement. We were also placed on the fast track list with the BC government in 2025, so we were a key priority for the province. You know, this was one of the reasons why we were able to have all of our permits come in back-to-back in February of this year, where you saw the EA certificate, the Mines Act, the Environmental Management Act, and the federal assessment all come in within one week's time, is that we were a key priority for the province and also for the Tahltan Nation in bringing this project downstream.
I'd also like to point out that in December of 2025, with the Section 7 agreement, we had an impact benefit referendum vote. We had very, very strong support from the nation and the local communities at about 77% approval. That was one of the key factors that unlocked all of our permits coming in at the start of this year as well. The other point that I'd like to mention is because we were on the fast track list and because, you know, we did have the support of the province and we had the support of the Tahltan Nation, we were able to advance a significant portion of our construction prior to receiving permits.
That is why today we're approaching the halfway mark of our construction progress, is that we were able to do a lot of work before receiving those permits. Even before that, we started working on this project about 10 years ago. Multiple technical reports to date have been published, the latest one being the definitive feasibility study that came out in 2023. It's been a long journey. If you look at the trajectory of the company and where we are today, a lot of the key risks have now been eliminated. Discovery risk, financing risk, permitting risk. From now until the start of production for us, it's really just to focus on execution and getting across the finish line on time and on budget. The project is located in northwest British Columbia in an area called the Golden Triangle.
It's an area that is definitely globally recognized for immense geological potential. There are some operations in this area. There's some fantastic projects in the area. Being a brownfield asset, Barrick left behind a fully permitted tailings facility for us. That was really important 'cause it not only provided substantial cost savings, but it also saved us a lot of time with regards to permitting a new tailings facility. The other important factor is that a private company coincidentally installed three hydroelectric facilities 17 km away from our mine. These hydroelectric facilities allow us to source power for about CAD 0.065 per kWh. When investors ask us the question, okay, you know, how are you guys so profitable with all of this cash flow generation?
The answer is, one, it's a grade story, so very high grade ore body. Two, we have a very favorable low cost of power. The combination of grade and low cost power is one of the best formulas for a very, very profitable open pit operation. Just reviewing some of the metrics from the 2023 definitive feasibility study, and looking at the economics at $4,800 gold and $76 silver, the NPV of the project is about CAD 9 billion after tax. The IRR is an astounding 107%, and the payback period for the project is less than eight months. The financial metrics on the other side of production are also equally amazing.
At spot prices today in Canadian dollars, we're gonna be generating an estimated CAD 2.6 billion in annual EBITDA per year in the first five years of production. If you apply a multiple of six to that EBITDA, which is just a conservative multiple that we like to think about, you can get to a CAD 15 billion market cap company. The annual after-tax free cash flow of CAD 1.6 billion, if you apply a multiple of eight to that figure, you will get to a CAD 13 billion market cap capitalization. Just a couple of different ways for investors to think about valuation as we get into production and cash flow in the next year.
The one point that I would like to make with these numbers is that these are based on the 2023 DFS, and towards the end of this year, we are gonna be coming out with an updated 43-101, where we will be updating some of those numbers. Just wanted to make that point. The production profile in the 2023 DFS was very front-loaded. You can see that the grade and the ounces are elevated in years one through six, and then we have a drop-off. One of the things that we're incorporating in the updated 43-101 that will come out later this year is the incorporation of a satellite ore body into the mine plan.
It is also an ex-Barrick asset that's in our portfolio called Snip that's located about 40 km away from the Eskay Creek mill. The idea is that we would truck the ore from Snip and process it at Eskay Creek. The material at Snip is relatively high grade as well. Some of the grades in the measured and indicated category are 9 grams per ton. The idea is that when we incorporate Snip, we would smooth out this dip and also extend the mine life. There is a couple other factors that we will be adding to this 43-101, which is also a study that we're undergoing right now with regards to optimizing the pit walls so that we can deepen the pit walls and capture some more of the underground component.
There are some high grade lenses to, again, optimize and improve this mine plan. In June 2024, the project was fully financed through an agreement that we had with Orion and Blackstone. We've drawn down on the gold stream for the majority of 2025 to fund the construction schedule. The condition precedent for drawdown on the senior secured loan was the receipt of our permits, which we just got in February. We as a company have been pretty upfront about our desire to refinance the senior secured loan and the cost contingency. We've been working with a company called KKR out of New York to advise us on potentially refinancing this debt so we can lower our cost of capital on new debt as well as buy back a portion or all of the gold stream.
The buyback provision with the gold stream is that we can buy back 2/3 of it at an 18% computed IRR. We're in negotiations at the moment with Orion and Blackstone to see if there's a possibility that we can buy back the 2/3 sooner and maybe the remaining 1/3. That could be a very, very strong catalyst for sometime in the near future with regards to the refinancing of the debt and a buyback of the gold stream, whether that be a portion or all. This just looks at why the asset is so phenomenal and so desirable. Here you can see some of the highest grade open-pit mines globally, and here's one through five. We're second from the top.
Life of mine, we're also very compelling, but we know with the updated 43-101 that's gonna be coming out later this year, we're gonna be increasing that life of mine number higher. You know, the one key takeaway that I would like investors to take from this presentation is that Eskay Creek is a very, very high-grade ore body, and that's very, very important because it dictates cash flow, it reduces risk, it lowers costs, and ultimately, you know, generates higher multiples for investors. We also have a significant reserve, so about 4.6 million ounces of gold equivalent in reserves. 80% of that is in the proven category for a peer leading rate of confidence.
The other part of the story is that the asset is split up to about 65% gold, 35% silver. That revenue split changes as the gold-silver ratio changes, right? The byproduct on the silver actually makes this a very, very meaningful silver mine. We're gonna be doing about 9.5 million ounces of silver per year in years one through five, and life of mine, 7.7 million ounces. If you know the silver space, you know that 9.5 million ounces of silver is a very, very meaningful number. We've got 88 million ounces of silver in reserves, and none of the silver has been streamed. We've intentionally left that untouched because we see a very, very bright future for both gold and silver in the short and medium term.
On the construction, at year-end, the project was about 45% complete. At the end of February, the project is about 49% complete. I'll walk through some of the pictures so that we can look at some of the progress to date. We're very proud to be performing the majority of the earthworks using in-house expertise. We've always felt that's a very important skill to have in-house as miners, and especially with managing costs. Here on the left-hand side, you can see the road leading to the pit with the haul trucks driving up. The picture in the middle is the start of our main pit. The picture on the right is the earthworks for the MRSA water collection pond, which is downstream from the mill.
You can see the mill just in the top corner up there. The process plant, it went up relatively quick. Here you can see from September to December, we erected the steel, we enclosed the building, and by December, once we'd had, you know, our first snowfall, the building was ready for it. It was fully enclosed so that for the winter months of this year, we can proceed with the work on the interior. That's what we've been doing. We've laid down the concrete here on the left-hand side. You can see the SAG mill pedestals. These structures are the grinding mills will sit on top. All of the grinding mills have been shipped to the Port of Stewart.
Over the next couple of months here, they'll be installing the grinding mills inside of the mill so that we can fill the mill and get that going. Here's a look at the water treatment facility at the start of it, the earthworks for it, and then the power. I talked about our low-cost favorable power. The ring bus will be installed right above those pedestals and connect to the transmission lines that you see in the picture. The site will be fully energized by the end of 2026. That's the employee camp base. All right. Just another slide before we close it off here for valuations, and this is one of our favorite slides. It's the famous Lassonde Curve. We've overlaid our share price on top.
You can see it has followed this theory and this framework to a T. After we announced the project financing, we came out of the valleys. We're trading at about 0.5 x P/NAV, ultimately being a Tier 1 jurisdiction, a world-class asset, you know, and all of the silver that we have. We feel very confident that we can attain multiples north of 1.3 x P/NAV as we get into production and cash flow over the next year. We still have a long ways to climb up this curve. Every quarter, as we continue to advance the project, as we invest more capital into the project, as we get closer and closer to production, our share price will continue climbing up the Lassonde Curve and re-rate as we get closer to production.
It's a really easy story. You can look at some of the other industry comparables as well to get a sense of valuation. For example, you know, a company like Artemis Gold with their Blackwater Mine in British Columbia as well, they've got a market cap today of about CAD 9 billion. Their production for 2026 is about 300,000 ounces. They are doing an expansion to get to 500,000 ounces. Then the other company you can reference is Alamos Gold with a market cap of CAD 27 billion, free cash flow of about CAD 1 billion, and production of 600,000 ounces, right?
You can see that just looking at some of the industry comparables over the next year or two, as we rerate and get into full scale production, our valuation realistically could come somewhere right in between those two. Just because I'm nearing the end of my time, I'll conclude the presentation with a snapshot of our capitalization. We are about 65%-70% institutionally held. We've got 121 million shares outstanding. We've got 11 banks that have research coverage on us, and we have, you know, a very, very solid shareholder base.
All of the mining dedicated funds in our industry have a position as well as now we've also been meeting with a lot of generalists that also have a position in the company that have been building the starter positions and building bigger positions now that, you know, the investment thesis for gold has become more imminent. All right, well, thank you for your time and if you have any questions at all, please feel free to reach out to investor relations. Ask Gina. You can get all of our information on our website. Thank you so much.