Barnat Pit Wall Slip Cuts Gold Output 150,000 oz a Year

Agnico Eagle suspended operations at the Barnat open pit on July 1 after a rock mass movement along the north wall. The slide caused no injuries and no environmental damage, the company said. It will cut production.

Agnico Eagle expects the H2 2026 gold output from the Canadian Malartic complex to fall by 60,000 to 80,000 ounces. In 2027 and 2028, the annual hit could be as much as 150,000 ounces. Those are initial estimates, subject to change as the geotechnical assessment proceeds.

The Barnat pit was on schedule to be fully mined by early 2029. That timeline may slip. Agnico Eagle its technical teams are conducting a detailed geotechnical assessment to determine the wall's stability and the safe path to restart.

The rock mass movement does not affect the Odyssey underground mine, Agnico Eagle said. The underground project is the driver of the long-term plan to reach 1 million ounces of annual gold production from Canadian Malartic in the early 2030s.

OR Royalties holds a 5% net smelter return royalty on nearly all the mineral reserves in the Barnat pit. The company said its 2026 gold equivalent ounce delivery guidance remains unchanged. Its five-year outlook also holds steady.

OR Royalties shares trade on the TSX and NYSE under the ticker OR. Agnico Eagle's geotechnical assessment is the next near-term input for the stock. A quick resolution that limits the 2027-2028 impact removes the overhang. A longer remediation raises a different set of questions about the scale and duration of the production loss.

Agnico Eagle expects the assessment to guide the timeline for resuming operations and any long-term revisions to the pit plan.

The Barnat pit sits within the Canadian Malartic complex, which operates in the Abitibi greenstone belt. Rock mass movements in open pits typically follow stress changes from excavation, often triggered by heavy rain or geological weak zones. The current assessment will determine which factor played a role.

For OR Royalties, the Barnat pit royalty is one of more than 200 royalty and streaming interests in its portfolio. The company's cornerstone asset is a 3-5% NSR royalty on the entire Canadian Malartic complex. The Barnat pit is a subset of that larger royalty. The production loss in Barnat may be partly offset by production from other zones within the complex. That is not assured.

Agnico Eagle said it is evaluating opportunities to mitigate the impact on its production outlook. Options could include accelerating mining from other pits or processing stockpiled ore. Any mitigation steps would need to pass the same geotechnical scrutiny.

The next milestone is the geotechnical assessment. Agnico Eagle has not given a timeline for completing it. The market will watch for an update on the wall's condition and any changes to the pit's life-of-mine plan. The H2 2026 production guidance already reflects an initial estimate of the impact. If the assessment finds a larger affected zone, the 60,000-80,000 ounce figure could move higher.

Agnico Eagle's broader portfolio includes operations in Canada and Finland. The Barnat event is isolated to the Canadian Malartic complex. It reminds the market that open pit mining carries operational risks that can shift near-term production profiles.

For OR Royalties, the unchanged guidance signals that the company sees the impact as manageable within its portfolio. The 2027 and 2028 figures, up to 150,000 ounces per year, are large enough. A prolonged disruption would eventually pressure the royalty revenue stream. The geotechnical assessment is the next near-term driver for both stocks.