Strategic Metals Ltd. has released a Preliminary Economic Assessment and a scoping-level evaluation for its wholly owned Division Mountain coal project in south-central Yukon, shifting the asset from a static resource holding into a formally evaluated open-pit mining and power generation concept.

The new technical reports advance the project beyond Strategic’s acquisition in May 2025, when the company secured the two coal licenses 90 km northwest of Whitehorse with a historical measured resource of 52.5 million tonnes of bituminous coal. The August 2026 Preliminary Economic Assessment establishes a complete open-pit mine design and processing plant capable of supplying 500,000 tonnes of clean coal per year over a 30-year operational life.

Total capital cost for the development is pegged at $978.6 million, which includes $856.6 million for a 100 MW power plant and related infrastructure—such as a camp and transmission line—alongside $122 million for the mine and processing facilities. The financial model also incorporates a $20 million reclamation bond and total contingencies of $133.9 million.

The PEA calculated an average operating cost of $52 per tonne to deliver clean coal to the power plant, with an average stripping ratio of 3.5:1 waste to run-of-mine coal. For the power plant itself, fixed costs are estimated at $11.2 million per year alongside variable costs of $6.40 per MWh, resulting in an average total operating cost of $52 per MWh. Under the base case capital scenario at an 8% discount rate, the project reaches an after-tax internal rate of return of approximately 8% at an electrical sales price of $194 per MWh, excluding carbon taxes.

The accompanying scoping study evaluates the viability of constructing either a single 100 MW power plant or two 50 MW units to alleviate growing winter electrical deficits in Yukon’s isolated grid, which currently relies on imported diesel and liquefied natural gas. The study indicates a 100 MW coal-fired plant could generate electricity at $0.20 per kWh, while two 50 MW plants would produce power at $0.22 per kWh. Both projected generation costs sit below estimated rates for LNG at $0.23 to $0.26 per kWh and diesel at $0.33 per kWh.

To help guide community engagement and First Nations governance for the initiative, Strategic appointed Sam Wallingham as Vice President of Energy Development in January 2026.

"Strategic and YES feel strongly that the Division Mountain Project offers Yukon an economically and environmentally viable alternative to expensive imported hydrocarbon fuels for electrical power generation", stated Doug Eaton, President and CEO of Strategic. "Electrical generation using Division Mountain coal could result in lower electrical bills for residential and industrial users, eliminate tenuous supply chains and outflow of capital related to importation of diesel and LNG, and lead to greater self-sufficiency for food supply if hot water from the coal-fired plant is used to heat greenhouses and other infrastructure. Strategic and YES look forward to establishing strong partnerships that will advance this vision and thus promote security and growth in Yukon."

Strategic and its subsidiary, Yukon Energy Solutions, plan to refine the sizing parameters for the mine and power plant as discussions continue with utilities and mining companies.

Read the full announcement: Strategic Metals Ltd Advances its Division Mountain Project with a Scoping Study and a Preliminary Economic Assessment