West Red Lake Gold Mines Ltd. (WRLG:TSX.V; WRLGF:OTCQB; FRA:UJO) could bring Fork onstream as early as next year and thereby extend the mine life of its nearby, producing flagship Madsen project, noted a Velocity Trade Capital report.
West Red Lake Gold Mines Ltd. (WRLG:TSX.V; WRLGF:OTCQB; FRA:UJO) began a 3,000-meter (3,000m) surface drill program at Fork, a deposit only 250m to the southwest of its flagship Madsen mine in northern Ontario's Red Lake Gold District, reported Velocity Trade Capital Analyst Paul O'Brien in a Nov. 26 research note.
"Fork has [the] potential to add another year of production to [Madsen's] life of mine (LOM)," O'Brien wrote.
Velocity Trade Capital maintained its CA$2.05 per share (CA$2.05/share) target price on the Canadian gold producer, trading at about CA$0.88/share at the time of O'Brien's report, the analyst noted. From that price, the return to target is 133%.
West Red Lake Gold remains rated Outperform.
When the company declares commercial production, expected in Q1/26, a WRLG rerating and multiple expansion should follow, O'Brien wrote. This should lower discount rates to 5% from 7.5% and shrink the gap between the current and fully valued net asset value (NAV) multiples. Now, West Red Lake Gold is trading at 0.36x price:NAV versus a blended target multiple of 0.85x.
The company has 396.3 million shares outstanding. Its market cap is CA$360 million (CA$360 M).
O'Brien pointed out that West Red Lake Gold could add Fork's resource to Madsen's and, in doing so, ultimately extend Madsen's mine life. Currently, Fork has an indicated and inferred gold resource of about 80,000 ounces (80 Koz). Standout historical drill holes returned high gold grades in these intercepts: 13.97 grams per ton gold (13.97 g/t Au) over 13.1m and 8.1 g/t Au over 9.3m.
Additionally, West Red Lake Gold noted a high-grade core at Fork. Preliminary estimates outlined a target of 130,000-150,000 tons at 8-9 g/t Au. This represents about 33-43 Koz of gold not included in the Madsen prefeasibility study (PFS). Plus, the mineralization at the Fork target remains open downplunge.
Given these data, Velocity Trade has already added another 35% to Madsen's indicated resource in its model. This was at 7 g/t Au, a lower grade than the 8.2 g/t of the Proven and Probable reserve. This resource addition extends the LOM to 11.6 years.
Fork and potentially the Rowan and Starratt-Olsen areas could serve as spokes to the Madsen hub, thereby reducing reliance on Madsen, O'Brien noted.
The analyst highlighted that after only months of required development, Fork could be added to the Madsen mine plan and could be in production next year.
One reason why it could happen so quickly is that drilling can be done from the surface because Fork's existing resource is shallow. Also, Madsen's current underground development can be drifted/connected from Level 3 to Fork, given the two deposits are in close proximity. Velocity Trade expects the capital needed to achieve this to be modest, at less than CA$3M.
O'Brien provided Velocity Trade's forecasts for Madsen in the short and longer term. The financial services firm estimates West Red Lake Gold's Q4/25 gold sales to amount to about CA$50M, assuming 9 Koz of Au are poured at an average of US$4,100 per ounce (US$4,100/oz). In Q3/25, gold sales were lower than Velocity's CA$49M estimate, but production during the quarter was 34% greater than in Q2/25. This suggests the producer's output levels are "on track for early 2026," the analyst wrote.
After the ramp-up at Madsen, Velocity Trade projects average gold production of 67 Koz per year (67 Koz/year) at an all-in sustaining cost (AISC) of US$1,600/oz, for the first full four years, 2026 to 2029. Velocity also estimates payback in 2026. This fast payback is due to higher gold prices (US$4,000/oz-plus) and Madsen being a past-producing mine with existing infrastructure and milling capacity.
Velocity Trade expects West Red Lake Gold Mines to expand the mill capacity at Madsen in about 2030 to 1,200 tons per day. This would increase average gold production to about 102 Koz/year at an AISC of US$1,500/oz.
O'Brien looks forward to further details on a 2026 mine plan that includes Fork, more information, and timing on the Rowan area, and 2026 production guidance.
The next catalyst for West Red Lake Gold is its reaching commercial production at Madsen, expected in Q1/26, noted O'Brien. Results of drilling and progress updates on advancing Rowan are anticipated on an ongoing basis over the short term. Completion of a Madsen-Rowan PFS is scheduled for 2026, to be followed later in the year by Rowan permitting and a throughput increase at the Madsen mill.
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Important Disclosures:
West Red Lake Gold Mines Ltd. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$3,000 and US$6,000.As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of West Red Lake Gold Mines Ltd. Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.For additional disclosures, please click here.
Disclosures for Velocity Trade Capital, West Red Lake Gold Mines Ltd., November 26, 2025
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