Osisko Development Corp has raised $125 million through a bought deal financing to support drilling programs at its Cariboo Gold Project. The funding is intended to accelerate resource conversion and advance feasibility work at the British Columbia-based asset.
Aerial view of Osisko Development’s Cariboo Gold Project in British Columbia, the company’s flagship gold asset. (Source: G Mining Services)
Bought Deal Financing Strengthens Capital Position
Osisko Development confirmed it will issue 35.31 million common shares at $3.54 per share, generating gross proceeds of $125 million. National Bank Capital Markets, RBC Capital Markets, and Cantor acted as co-lead underwriters for the transaction.
Osisko Development Corp secured $125 million through a bought deal financing to advance its Cariboo Gold Project. (Source: OSISKO)
The offering includes an over-allotment option for up to 5.3 million additional shares. If exercised, this could add about $18.8 million in supplementary proceeds. The company expects the financing to close on January 30, 2026.
The bought deal structure provides certainty and speed for capital deployment. It also allows Osisko Development to lock in funding ahead of its next drilling cycle.
Funds Target Resource-to-Reserve Conversion
The company said net proceeds will be directed mainly toward infill conversion drilling and at-depth exploration at Cariboo. These programs aim to upgrade existing inferred and indicated resources into higher-confidence reserve categories.
Management described the drilling focus as essential for reducing geological risk. The work is also expected to support the next stage of economic integration into a future mine plan.
Some funds will also support general corporate purposes. This allocation is intended to maintain working capital levels during the development phase.
Drilling Strategy and Program Scope
Osisko Development outlined a comprehensive drilling strategy. Infill conversion drilling will focus on upgrading indicated resources into probable and proven reserves.
At-depth exploration drilling will test extensions below current resource boundaries. This component is designed to assess potential mine life expansion.
Infill conversion and at-depth exploration drilling at the Cariboo Gold Project will support resource upgrades. (Source: The Northern Miner)
Grade confirmation drilling will support mining sequence optimisation. The company said this will improve production planning accuracy.
General working capital funding will ensure operational continuity. Management stated the drilling results will guide future resource categorisation.
Regulatory Progress Provides Development Certainty
The Cariboo project operates within British Columbia’s established mining jurisdiction. Osisko Development has already secured major regulatory milestones.
The Environmental Assessment Certificate was granted in October 2023. This completed the project’s most comprehensive regulatory review process.
Compliance under the BC Mines Act was achieved in November 2024. Approval under the Environmental Management Act followed in December 2024.
Indigenous consultation remains ongoing with multiple First Nations. These include Lhtako Dené Nation, Williams Lake First Nation, and Xatśūll First Nation.
The company has signed a Life of Project Agreement with Lhtako Dené Nation. A Participation Agreement is also in place with Williams Lake First Nation.
Gold Market Conditions Support Project Economics
Gold prices remain near record highs. This has improved project economics compared with earlier feasibility assumptions.
The 2025 feasibility study used a base case of $2,400 per ounce. Current market prices sit well above that level.
Higher gold prices increase net present value estimates. They also improve potential debt service coverage ratios for project financing.
The Cariboo project is forecast to produce about 1.89 million ounces over an initial ten-year mine life. Management said current prices provide a wider margin for contingencies.
Central bank gold purchases continue to support long-term demand. Geopolitical tensions have also maintained safe-haven interest.
Supply constraints from declining reserve grades globally are contributing to price stability. These conditions support development-stage projects like Cariboo.
Infrastructure Advantages and Phased Development
Cariboo is located within the historic Wells-Barkerville mining camp. The district offers established infrastructure and workforce access.
Existing road networks reduce the need for major access construction. The site lies about 63 kilometres from Quesnel, a regional service hub.
Established infrastructure in the Wells-Barkerville mining district supports efficient project development. (Source: ConstructConnect)
The area provides access to experienced underground mining personnel. This reduces training requirements and ramp-up timelines.
Osisko Development is pursuing a two-phase development strategy. Phase 1 targets lower initial capital requirements and faster cash flow.
Phase 2 would expand capacity to about 4,900 tonnes per day. This expansion is planned for 2027 to 2036.
The phased approach allows flexibility based on market conditions. Management said it preserves optionality for future production scaling.
Geological Predictability and Exploration Potential
The Cariboo deposit exhibits orogenic gold characteristics. These are associated with established shear vein systems.
This geological setting supports consistent mineralisation patterns. It also enhances grade control and resource modelling reliability.
The deposit includes multiple development zones. These span Cow Mountain, Island Mountain, and Barkerville Mountain.
Historic production data provides validation benchmarks. Management said this supports mining predictability and planning accuracy.
Orogenic systems typically show better grade continuity. This reduces mining risk and improves production forecasting.
Market Position and Financial Context
Osisko Development operates in the Basic Materials sector. Its focus remains on precious metals exploration and development.
The company also holds assets in Mexico and the United States. These include the San Antonio project and the Trixie test mine.
As of late January 2026, the company’s market capitalisation stood near $973 million. Institutional ownership is about 26.28 per cent.
The bought deal will more than double Osisko Development’s cash reserves. The company held about $46.3 million in cash before the raise.
The share issuance will increase the company’s share count. Management described the dilution as a trade-off for project funding.
The stock traded around $3.85 before the offering. The $3.54 issue price reflects an 8.5 per cent discount to recent levels.
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Path Forward for the Cariboo Project
The immediate objective is successful resource conversion drilling. This is required before integration into a mine plan.
The company said results from bulk sample and infill drilling will be the next major milestone. These outcomes will guide construction financing decisions.
Management stated the financing provides time and certainty for this development phase. It also supports near-term feasibility work.
Osisko Development said it will continue updating the market on drilling progress. The company added that further regulatory and consultation milestones remain priorities.
The raised capital is intended to move Cariboo toward a bankable feasibility stage. Execution of the drilling program remains the central focus.
