Executive Summary / Key Takeaways

• Amarc Resources ($AXREF) is an exploration-stage company focused on district-scale copper-gold-molybdenum-silver porphyry deposits in British Columbia, Canada, operating without revenue and relying on strategic financing.
• Strategic earn-in agreements with major partners like Freeport-McMoRan (FCX) and Boliden (BOL) are accelerating exploration, providing substantial funding for extensive drill programs across its JOY, DUKE, and IKE Districts.
• Recent exploration successes, including the AuRORA discovery at JOY and significant expansions at PINE, Twins, and Canyon, underscore the potential for substantial resource delineation.
• The company's financial health is characterized by net losses and a working capital deficiency, highlighting a dependence on external capital and the inherent liquidity risks of an exploration-stage enterprise.
• Despite intense competition from larger, established mining companies, Amarc differentiates itself through focused regional expertise and a systematic exploration methodology, aiming to build long-term value through discovery.

Setting the Stage: A Focused Explorer in British Columbia's Mineral Riches

Amarc Resources Ltd. ($AXREF) operates as a dedicated mineral exploration company, strategically focused on identifying and advancing significant copper-gold-molybdenum-silver (Cu-Au-Mo-Ag) porphyry deposits across British Columbia, Canada. Established in 1993, Amarc has meticulously assembled a portfolio of district-scale projects—JOY, DUKE, and IKE—each benefiting from proximity to essential industrial infrastructure, including power, highways, and rail. This advantageous positioning is critical for potential future development, offering logistical efficiencies in a region renowned for its abundant mineral resources. Amarc's core strategy revolves around pinpointing high-potential exploration targets through rigorous scientific methodologies and, crucially, forging strategic partnerships to de-risk and fund extensive exploration programs.

The global market for base and precious metals, particularly copper and gold, is experiencing a period of robust demand. This surge is propelled by accelerating trends in electrification, the expansion of renewable energy infrastructure, and the growing requirements of the artificial intelligence (AI) and data center boom. Copper prices, for example, have demonstrated a strong upward trajectory, climbing from $2.80 per pound in 2020 to $4.29 per pound year-to-date in 2025. Gold prices have similarly seen a significant increase, rising from $1,769 per ounce in 2020 to $3,093 per ounce year-to-date in 2025, reflecting strong underlying market fundamentals for the commodities Amarc targets. This favorable market environment provides a compelling backdrop for Amarc's exploration-centric business model, as successful discoveries could yield substantial value in a high-demand commodity cycle.

The Engine of Discovery: Amarc's Exploration Strategy and Methodological Edge

Amarc's distinctive strength lies in its systematic and integrated approach to mineral exploration, which can be considered its core "technological" differentiator. This methodology combines advanced geophysical surveys, detailed geochemical sampling, precise geological mapping, and targeted drilling to efficiently identify, delineate, and expand porphyry Cu-Au-Mo-Ag systems. A key component of this approach is the extensive use of Induced Polarization (IP) geophysical surveys. These surveys are instrumental in detecting chargeable, pyrite-bearing rock and non-conductive quartz-rich rock, offering crucial insights into the subsurface distribution of sulfide mineralization. This systematic targeting strategy enables Amarc to prioritize drill-ready targets, thereby optimizing the deployment of exploration capital.

The tangible benefits of this methodological edge are clearly demonstrated in the company's recent discoveries and project expansions. At the JOY District, for instance, IP chargeability ground geophysics played a pivotal role in defining the expansive NWG Target, which subsequently led to the AuRORA deposit discovery in an area previously untested by drilling. Similarly, the highly prospective Twins porphyry target sulphide system is defined by a 7 km² IP chargeability anomaly. While specific quantifiable performance metrics such as "cost per discovery meter" are not publicly disclosed, the consistent identification of new mineralized zones and the expansion of existing ones, such as the PINE Deposit's strike length expanding to over 1,700 meters, underscore the effectiveness of Amarc's exploration methodology.

Amarc's research and development (R&D) efforts are intrinsically linked to continuously refining these exploration techniques. The company consistently integrates new data derived from airborne magnetics, geochemical surveys, and detailed geological interpretations to develop more effective exploration templates. For example, in the DUKE District, a comprehensive compilation of government and historical data, including 2,300 regional geochemical samples and 116,344 line-kilometers of airborne magnetics, facilitated the identification of 16 previously unrecognized porphyry copper deposit-scale targets. This ongoing refinement of targeting strategies aims to enhance the probability of discovering economically viable deposits and reduce overall exploration risk. For investors, this methodological advantage translates into a stronger potential for resource growth and, ultimately, the creation of shareholder value through successful project advancement and potential monetization.

Project Portfolio: Unlocking Value Across Three Districts

Amarc's portfolio encompasses three district-scale projects—JOY, DUKE, and IKE—each exhibiting significant exploration potential.

The JOY District in north-central British Columbia has been a primary focus of recent activity. In 2024, Amarc achieved a significant new porphyry Cu-Au-Ag discovery at AuRORA, an area that had not been drill-tested until that year. Initial drilling successfully established a 600-meter-wide zone of porphyry mineralization, characterized by excellent lateral and vertical continuity, and remains open to expansion from near surface. Notably, drill hole JP24074 intersected 162 meters grading 2.19 g/t Au, 0.63% Cu, and 7.0 g/t Ag, including a high-grade interval of 81 meters at 3.69 g/t Au, 0.92% Cu, and 9.7 g/t Ag. This discovery, alongside a second discovery at the Twins Cu-Au target and the expansion of the PINE Deposit (now extending over a 1,700-meter strike length) and the Canyon Discovery, highlights the district's potential for hosting multiple clustered porphyry systems. Freeport-McMoRan Mineral Properties Canada Inc. has been fully funding work programs at JOY since 2021, and in May 2025, earned an initial 60% interest by investing $35 million under an accelerated timeframe. An approved $10 million drill program for 2025, managed by Amarc, is currently underway, with a focus on these key discoveries and other high-potential targets. Further consolidating its position, Freeport exercised its right in July 2025 to include the Brenda and a portion of the PIL properties into the JOY Agreement, adding to the district's overall potential.

The DUKE District, situated northeast of Smithers, represents another high-priority project for Amarc. In 2022, Boliden Mineral Canada Ltd. entered into an earn-in agreement, committing $30 million in exploration and development expenditures, with $20 million invested by the end of 2024 and an additional $10 million planned for 2025. Delineation drilling conducted in 2017-2018, late 2022, and winter 2024 has expanded the DUKE Deposit to depths of at least 600 meters and laterally to over 650 meters north-south by 800 meters east-west. Significant intercepts include 183 meters of 0.43% CuEQ in hole DK22009 and 104 meters of 0.38% CuEQ in hole DK24033. The recent recognition of the South Graben Fault suggests the possibility of expanding the deposit over a 700-meter strike length, while initial drilling at the newly identified DUKE Offset indicates a target with an approximate 500-meter strike length and an estimated true width of around 120 meters. The 2025 program is strategically focused on testing new copper-gold targets, including Svea, JO, and C4, where mineralized biotite-feldspar porphyry intrusions have been identified, pointing to gold-enriched systems.

In west-central British Columbia, the IKE District hosts the IKE porphyry Cu-Mo-Ag deposit discovery and the high-potential Greater Empress Cu-Au Project. Amarc's drilling at IKE has confirmed the presence of a substantial body of porphyry mineralization spanning an area of 1,200 meters east-west by 1,000 meters north-south, and extending to a vertical depth of 875 meters, with the deposit remaining open to expansion. The 2024 program, which involved an investment of approximately $2.90 million, concentrated on the historical Empress Cu-Au Deposit, successfully confirming encouraging copper and gold grades within replacement-style mineralization. Re-logging and re-assaying of historical core demonstrated strong positive correlations with 2024 data for copper and silver, allowing for meaningful integration into future modeling. New drilling at Empress intercepted 181 meters at 0.46% CuEQ, including 60 meters at 0.90% CuEQ. The Empress East Deposit Target also yielded significant intercepts, with alteration intensity and copper-gold grades increasing to depth and southward, indicating a largely untested prospective block. The newly identified Granite porphyry Cu-Au-Ag-Mo occurrence is considered a possible source of the mineralizing replacement fluids for Empress, with re-assaying of historical drill hole 91-49 returning 102.10 meters of 0.26% CuEQ.

Financial Performance and Liquidity: Fueling the Exploration Drive

As an exploration-stage company, Amarc Resources fundamentally operates without revenue from its core business activities. For the fiscal year ended March 31, 2025, the company reported a net loss of $3.91 million, a notable increase from the $43,450 net loss recorded in the prior fiscal year. This expanded loss primarily reflects a substantial increase in exploration expenditures, which surged to $22.58 million in 2025 from $12.43 million in 2024. These significant expenditures are partially offset by cost recoveries derived from earn-in agreements, totaling $11.62 million from Freeport for the JOY District and $6.86 million from Boliden for the DUKE District in 2025.

Liquidity remains a critical aspect of Amarc's financial profile. As of March 31, 2025, the company maintained a cash balance of approximately $1.21 million, alongside a working capital deficiency of $1.34 million. Historically, Amarc's funding has been primarily sourced from the issuance of equity securities, private placements, and director loans. The company's ability to continue as a going concern is explicitly stated as contingent upon securing additional financing, a common and inherent challenge for exploration companies. A $1.00 million loan from a director, bearing 10% interest, was extended to November 26, 2025, providing a measure of short-term capital. While Amarc prioritizes preserving its cash resources, its operational activities are largely sustained by partner contributions, which are initially recognized as liabilities and subsequently as cost recoveries as related expenditures are incurred. This funding model effectively leverages external capital to advance its projects, mitigating immediate shareholder dilution for partner-funded work.

Competitive Landscape: A Niche Player Among Giants

Amarc operates within an intensely competitive mining industry, where larger, established companies such as Teck Resources (TECK), Barrick Gold (GOLD), Newmont Corporation (NEM), and First Quantum Minerals (FM) hold significant advantages in financial resources, operational experience, and technical capabilities. These industry leaders, with their established production streams and diversified portfolios, typically demonstrate consistent revenue growth, robust profitability margins, and strong cash flow generation. For instance, Teck Resources, a diversified miner with a substantial presence in British Columbia, benefits from its operational scale and global partnerships, which facilitate faster project execution and broader market reach. Compared to these giants, Amarc's financial performance, as an exploration-stage company with no revenue, is qualitatively different, with negative profitability metrics and reliance on external funding contrasting sharply with the positive and substantial cash flows of its larger counterparts.

In this landscape, Amarc positions itself as a specialized, exploration-focused player. Its competitive strength lies in its deep regional expertise and a targeted approach to district-scale porphyry targets in British Columbia. While Amarc's exploration methodology, incorporating advanced geophysical surveys and systematic targeting, aims for efficiency in resource discovery, it operates at a significantly smaller scale. This allows for greater agility in pursuing niche opportunities and potentially more cost-effective early-stage exploration. However, this also means Amarc lags behind its larger competitors in overall financial health, market share capture, and the capacity for large-scale R&D investments. The substantial capital requirements for exploration and mine development, coupled with stringent regulatory hurdles, act as significant barriers to entry. These barriers both protect Amarc's existing claims from new entrants and simultaneously challenge its ability to compete directly with well-capitalized rivals. Amarc's strategic partnerships with Freeport-McMoRan and Boliden are therefore crucial in mitigating these competitive disadvantages, providing access to substantial funding and expertise that a junior explorer would otherwise struggle to secure independently.

Risks and Challenges: The Speculative Nature of Exploration

Investing in Amarc Resources is inherently speculative and carries a number of significant risks. The company operates with limited working capital and has consistently incurred net losses and negative cash flows since its inception, with expectations of continued losses for the foreseeable future. There is no assurance that Amarc will secure the additional financing required to fully develop its projects, nor does it have a history of mining operations or expected revenues in the near term.

Mineral exploration itself is highly uncertain; few properties ultimately become producing mines, and there is no guarantee that economic deposits will be found or that, if found, they will be sufficient in quantity and quality to generate a profit. Substantial expenditures are required to establish mineral resources and reserves, and the company's ability to obtain financing is heavily influenced by fluctuating mineral prices, which are subject to global economic trends, inflation expectations, and currency exchange rates. Regulatory and environmental approvals in Canada are complex and time-consuming, potentially taking a decade or more, with no guarantee of success. Furthermore, operations within Indigenous traditional territories may lead to permitting delays or opposition, which could impact project timelines and potential earnings. The reliance on third-party consultants, the potential for uninsurable liabilities (such as pollution), and the risk of equity dilution from future financings or stock option grants further underscore the speculative nature of an investment in Amarc.

Conclusion

Amarc Resources Ltd. presents a compelling, albeit speculative, investment narrative rooted in its systematic exploration and strategic partnership model for district-scale porphyry deposits in British Columbia. The company's recent successes, particularly the AuRORA discovery and the expansion of other targets within the JOY District, coupled with substantial funding commitments from Freeport-McMoRan and Boliden, demonstrate a clear and accelerated path to advancing its high-potential projects. While Amarc's status as an exploration-stage company means it currently generates no revenue and faces ongoing liquidity challenges, its ability to attract major industry partners validates the geological prospectivity of its assets and provides crucial capital for continued discovery.

The "so what" for investors lies in the potential for substantial resource delineation in a favorable commodity price environment, driven by global electrification and industrial demand. Amarc's focused exploration methodology and regional expertise offer a competitive edge in identifying and advancing these opportunities. However, the inherent risks of mineral exploration, including financing uncertainty, regulatory complexities, and intense competition from larger, more financially robust players, necessitate a discerning approach. Amarc's future success hinges on its continued ability to translate exploration achievements into defined resources and to maintain strategic alliances that fuel its growth, ultimately aiming to transition from a pure exploration play to a developer of significant mining assets.