All right. Hello everyone, and thank you all for joining us during the Lytham Partners Fall 2026 Investor Conference. My name is Robert Blum, Managing Partner at Lytham Partners. Up next, Mark Brennan, Chairman and CEO of Cerrado Gold, will be taking us through the company slide presentation. Mark, thanks so much for your participation. The floor is all yours.
Thank you, Robert. Thank you, ladies and gentlemen, for joining us at this Lytham Partners conference. Today I want to provide a quick update on Cerrado Gold. Cerrado Gold has three assets. Our core and key asset, Don Nicolás Gold Mine in Santa Cruz, Argentina. Project Lagoa Salgada, which is rapidly looking to come into construction. We have Mont Sorcier iron ore project in Quebec, which is a little bit ways out. With respect to the foundation of the company, we produce currently between 50,000 oz-60,000 oz of gold. We are looking to continue to drive our operation in Argentina, which is producing that gold. We started this asset in 2020 with 20,000 oz.
The last three years we have been in that 50,000 oz-60,000 oz, and now we are looking actually to expand that production and go to a new plateau, which we expect to do in 2027. The nice thing with CAD 4,000 gold, we have an AISC of under CAD 2,000. Basically, we generate a lot of cash. As one can see through our financials, basically we are cash rich right now. We are sitting on about CAD 35 million, and we expect to see that cash position grow irrespective of some developments that I will talk to you a little bit about later. That said, again, according to a PEA, which I am bound by, at CAD 2,100 gold, we cash flow CAD 50 million a year, with free cash flow of CAD 25 million a year. One can do the derivative of a multiple of where we are today.
As I mentioned, we have a near-term precious and critical mineral production asset in Portugal, Lagoa Salgada. Our expectation is to resubmit our feasibility study in the latter part of this year and hopefully be in construction mode by the third quarter of 2027. As mentioned, we also have a very substantial and robust iron ore project in Quebec. This has the ability to produce high grade, high quality iron ore. We have completed a PEA looking at about 5 million tons per annum. We have announced that we are looking at a new feasibility study to be completed shortly, which will be producing about 8 million tons in two stages. First of all, 4 million tons of iron ore and then moving up to 8 million tons. As of June 30th, we have CAD 25 million in cash and we are continuing to grow that cash flow very strongly.
Cerrado's objective and philosophy is to really grow cash flows. As you can see here, our current 55,000-oz production level, moving up to 97,000 oz with the addition of Lagoa, and then looking at Mont Sorcier coming in laterally. It has been and will continue to be our objective to continue to grow that through integral growth, but we've also looked at acquisitions like Falcon that we announced about three months ago, which will substantially increase our production. With respect to Minera Don Nicolás, this asset to us is still very young, very immature, yet has had very little exploration. We started about a year ago with the exploration program, and now we're looking to complete about 50,000 m in 2026, with about 20,000 m of underground exploration. From that regard, we expect to see an extension of mine life. We expect to see the next plateau of production.
We believe this asset over time will be able to get to 100,000+ oz . The next plateau probably won't get us there. We'll probably need another plateau and then we can get to that 100,000 oz. Nonetheless, we're making sure that we're driving the resource life, driving the resource production growth, while reducing and maintaining an AISC of about CAD 2,000 as our target. The company is progressing very well. We currently have a market cap of about CAD 375 million. Basically, we have a number of analysts who are covering us. At the same point, the majority of our shareholders tend to be small institutions and family offices, as well as retail investors. We have not raised money since 2023, which really hasn't given an opportunity for the institutions to get involved. Over time, we believe that that position will grow.
Here we're just looking at the long-term target of the company, five to six years with Minera Don Nicolás. We expect a PEA to come out in the first quarter of 2027, expanding that resource life, expanding our production base, and will obviously drive very strong cash flows at CAD 4,000 gold. Lagoa Salgada, as I mentioned, we've spent most of the money that we need to spend at Lagoa Salgada. We're looking to submit our permit by the end of this year, basically into construction in t he second half of 2027 and into production in early 2029. According to a previous feasibility study that we're enhancing right now, that is anticipated to generate CAD 75 million of cash flow a year. That project is funded. It will be funded by 70% project finance from UKEF, the U.K. Export Credit Agency, with Santander Bank.
On top of that, for the balance of the 30% that's required, we're looking at traders who are very interested in getting their hands on an offtake contract, which we believe will fund the majority of the balance of cash required. Mont Sorcier is a little bit further out, but also we have U.K. Export Credit Agency involved there, with TD Bank acting as a managing lead arranger. From there, we believe that this project is not going to cost us a whole lot of equity to get it funded. Again, 70% funding from the UKEF, and then the balance, we believe that we can do offtake funding, we believe we can do a stream funding, and we believe that we'll have capital available without diluting our shareholders. Minera Don Nicolás is a huge project. We acquired the project in 2020.
The Deseado Massif in Santa Cruz, Argentina, is a very prolific belt with very substantial producers. Cerro Negr o by Newmont is producing about 350,000 oz a year. Cerro Vanguardia , held by Anglo, which is the granddaddy on the belt, has produced about 8 million ounces to date. They are producing today about 150,000 oz. Next door to us at Cerro Moro, owned by Pan American, they are producing about 100,000 oz as we speak. We believe that Minera Don Nicolás has the opportunity to grow dramatically. Thus our exploration program will continue to spend CAD 15 million a year on approximately 50,000 m-70,000 m of drilling a year, which we believe will substantially drive our new resource which will be evidenced in the first quarter of 2027 when we publish a new PEA.
What is interesting to see here, if one looks at the life that we have, we are still very young compared to Pan American and Newmont and Anglo. What we have been doing is growing our expertise in the area. We now do heap leach operations, we have underground operations, we do open-pit operations. Very interestingly, we have been one of the lowest cost producers in Argentina, even though we only produce 50,000 oz-60,000 oz a year, which I think is a testament to our technical capabilities. As I mentioned, we do heap leach, which you can see at the top. That accounts for about 80% of our production currently. Underground in the bottom left corner here will be about 20%. We are looking for additional open-pit opportunities to move forward. We see lots of exploration potential.
You can see here on this slide, 10 km of high-impact areas where we see gold. There is pretty much gold wherever we look on this property. The real focus is to find the most attractive areas. I think that we, having started our exploration program in June of 2026, we are now in a very good position to see two or three areas that we see high impact, and we will be able to publish that in our first quarter of PEA of 2027. The real focus, extend mine life, expand our production base, and really see if we can drive this asset to be 100,000-oz producer, which we believe it will be able to. We recently acquired Falcon Properties. We acquired this from Pan American Silver. It builds into our Calandrias property on the heap leach operations.
The nice thing here is that we believe that there is a whole opportunity and a whole strategy for heap leach operations in the north of our property. The nice thing is that, frankly, we are the only guys at this point that it makes sense. We have the heap leach plants, we have the capabilities, we have the expertise. I think that over time you will see us expanding our properties here. Which again, just speaks to expanded mine life and expanded production levels. Lagoa Salgada on the Iberian Pyrite Belt is a very intriguing property. We acquired the option on this property in 2018. You are about an hour from Lisbon. You are at the very northwestern edge of the Iberian Pyrite Belt that has been producing since 5 BC, 6 BC.
The reality here is that this project has not been known, largely as a consequence that it sits underneath about 130 m of tertiary material. We believe that this asset will be very similar in its size and composition as Aljustrel and Neves-Corvo, and some of the other projects moving over into Spain. This is a 200-km belt, so it is not all that big. Neves-Corvo is a granddaddy on the belt, one of the biggest mines in Europe, been producing for quite a while and generally generating about 300,000 tons of zinc at the moment. From that regard, it is a big mine, and we think the potential for Lagoa Salgada is not far behind. When we acquired the project, it had 9 million tons of inferred resource. We now have 27 million tons. We are completing a feasibility study.
We are now working with the submission of our EIA with the permitting agency. We expect that we will resubmit our permit application in January of this year. From that perspective, we expect to be shovel-ready in the third quarter. This mine looks like it is a polymetallic mine, 40% precious metals, so we will produce about 40% silver and gold, but also have copper, zinc, lead that we think we can expand upon. We did not acquire this project for 27 million tons. We think that this project is much bigger. This will be the starting point where we get this thing into construction in Q3 of 2027, production in early 2029. Then what we do is we work at the same time to expand the resource, expand our production base.
It is very common on the belt to start with one or two pods, and then expand those, and a lot of that is driven by geophysics. What we see here is lots of scope for growth. On the bottom right-hand corner, this geophysical map shows you that there is a big scope. We are only focusing on the left. We are only focusing on a very small part right now. So we see lots of growth potential as we move forward, and we are very excited by the opportunity there. Finally, our Mont Sorcier project in Quebec. Basically, we have railway line, we have a port that the product can go to. Infrastructure is very critical for iron ore. The fact of the matter is that we are now completing a feasibility study. We expect to have that completed by the first quarter of 2027.
We will also look to file our permitting application by sometime in the summer of 2027. Basically, our hope would be to be in construction on this project by sometime in 2029, for production in 2031. The project is extremely robust. As I mentioned, it is a high quality, high grade iron ore. The PEA that we produced previously had extremely strong economics. We have seen some inflation increases, but at the same point, we think that the product will remain robust as a consequence of the high grade, high value material that we will be selling. In conclusion, we have basically a core in our gold production in Argentina. We are looking to grow that through internal growth.
However, we're also looking at potential opportunities in the gold sector where we will not dilute our shareholders substantially, but where we see great opportunity to drive substantial production, resources, and cash flow. That will be the core focus of the company moving forward and what I think investors should be looking for in the next six months. Thank you very much for your time, and you can always reach us if you have any further questions. Thank you.
Fantastic. Mark, thank you very much for your participation in the conference here today. Thank you, of course, to everybody for attending. If you do have additional questions or I can assist in scheduling a meeting, please shoot me an email. That's blum@lythampartners.com. To learn more about Lytham, make sure you visit our website or follow us on LinkedIn and subscribe to us on YouTube to stay connected on future events. We hope you all have a great rest of the conference. Great day. Mark, again, thank you so much for your time.
Thank you, Robert. Really appreciate it.