To The Moon

The Porphyry Pivot: How Aris Mining Is De-Risking Colombian Gold Through Industrial-Scale Underground Mining

While analysts still tend to file Aris Mining under ‘high-risk Colombian juniors,’ the company is quietly doing something far less exciting—and far more valuable. It is building an underground gold operation designed to behave less like a prospecting venture and more like a factory. The market loves romance in mining. What it often struggles to price correctly is repeatability.

That mismatch matters, because $Aris Mining(ARMN)$ no longer resembles the speculative profile it is routinely assigned. With a market capitalisation around US$4 billion, nearly US$770 million in trailing revenue, and operating margins above 40%, this is not a story about survival. It is a story about industrialisation. And in my view, that disconnect between perception and reality remains the investment opportunity.

From geological romance to engineered repeatability

When Labels Lag Reality

Markets are slow to update mental models, particularly in mining. Segovia’s long history as a narrow-vein, labour-intensive operation still colours how Aris is perceived, even as the company has evolved into something closer to a mid-tier producer with genuine operating depth.

The numbers tell that story clearly enough. EBITDA of roughly US$324 million, operating cash flow exceeding US$330 million, and revenue growth approaching triple digits year-on-year are not junior metrics. Nor is a balance sheet holding over US$400 million in cash with a current ratio north of two.

Yet Aris continues to trade as though its future cash flows are fragile. A trailing P/E above 70 suggests excess optimism until one looks forward. The compression to a forward multiple below 9 implies earnings are inflecting far faster than price. That gap reflects a single question: can they execute?

Marmato Is Not a Growth Project—It’s a Reinvention

Marmato is often described as a growth asset. That description is too tame. What Aris is attempting there is a wholesale reinvention of its operating model.

The shift from narrow, labour-heavy vein mining to bulk-tonnage underground porphyry extraction is not incremental. It replaces episodic production with volume, variability with consistency, and geological surprise with engineered throughput. Porphyry systems, once developed, behave more like manufacturing lines than mining adventures. Output becomes a function of process discipline rather than luck.

As of January 2026, the Marmato decline is approximately 45% complete. That detail deserves more attention than it receives. Decline development is the most execution-intensive phase of any underground project. It is where timelines slip, budgets strain, and confidence is either earned or lost. Clearing nearly half of that work materially reduces risk and shifts Marmato from projection to reality.

This is also the point at which optionality improves. Development rates accelerate, equipment utilisation rises, and working capital efficiency improves. In plain terms, once the hardest digging is behind you, the mine starts behaving the way spreadsheets always promised it would.

I appreciate that ‘porphyry throughput efficiency’ is not exactly cocktail-party material, but it is precisely the sort of boring detail that long-duration capital tends to underwrite.

Segovia: The Cash Engine Doing the Heavy Lifting

It would be a mistake to frame Aris as a company waiting for Marmato to justify itself. Segovia is already doing that work.

Despite its reputation as an old-school vein operation, Segovia has become a formidable cash generator. Those high-variance margins—so often criticised—are currently funding Marmato’s build while limiting the need for external capital. There is an elegant symmetry to this. A volatile operation is underwriting the transition to a more stable one.

This creates a subtle form of internal risk management. When gold prices are strong, Segovia throws off excess cash. That cash is recycled into a lower-cost, higher-predictability porphyry system designed to dampen volatility over time. It is a self-hedging strategy hiding in plain sight.

What the Financials Are Really Saying

If Aris were still a speculative story, the financials would betray it. Instead, they suggest a company in the middle of institutionalisation.

Enterprise value sits around US$4.05 billion against EBITDA of roughly US$324 million, placing Aris on an EV/EBITDA multiple near 18. That looks demanding until one considers that Marmato’s steady-state contribution is not yet fully reflected in most long-term models. As throughput stabilises, EBITDA should scale faster than enterprise value—particularly if leverage begins to decline.

Profit margins remain modest at the net level, but that is a function of growth-phase depreciation and financing, not operational weakness. The operating margin tells the more relevant story. At over 40%, it speaks to discipline rather than exuberance.

Structure emerging as the market starts treating Aris differently

Where Aris Really Sits

Competitively, Aris occupies an awkward but attractive middle ground. It is larger and more cash-generative than most Latin American juniors, yet still valued at a discount to established mid-tier producers with comparable growth profiles.

Unlike single-asset developers, it already generates material free cash flow. Unlike senior producers, it retains visible, internally funded growth. Compared with peers reliant on large open-pit expansions, Marmato’s underground design also reduces surface footprint and, over time, social friction. In a jurisdiction like Colombia, that distinction matters more than it is often credited for.

The Bear Case—And Why I’m Comfortable With It

None of this removes risk. Colombia remains a complex operating environment. Underground projects can still run over budget, and 45% complete is not the same as finished. Gold prices, meanwhile, remain an unhedged variable.

What reassures me is where Aris sits on the risk curve today. Much of the highest execution risk at Marmato is already behind it. The balance sheet provides flexibility rather than fragility. And crucially, the company is not betting the farm on a single binary outcome. Segovia continues to generate cash regardless of Marmato’s timeline.

This is no longer a lottery ticket. It is closer to a toll bridge—still exposed to traffic levels, but built to function day after day.

When Perception Finally Adjusts

The real catalyst for $Aris Mining(ARMN)$ will not be first production headlines. It will be the quieter moment when analysts stop modelling Marmato as a project and start treating it as infrastructure. That shift rarely arrives with fanfare. It usually follows a string of unremarkable updates where things simply keep working.

When that happens, Aris’s risk profile changes categorically. Comparisons move from developers to producers, and valuation frameworks adjust accordingly.

Capital commitment thickens as speculation gives way to conviction

When mining stops being a story and becomes infrastructure

The Verdict: Less Romance, More Sense

Gold mining thrives on stories of discovery. Aris Mining is telling a different one. It is replacing romance with repeatability, and spectacle with systems.

By pivoting from narrow-vein intensity to industrial-scale porphyry mining, Aris is building predictability into a sector that rarely offers it. With much of Marmato’s execution risk already cleared, a strong balance sheet, and a cash-generative base operation, the junior label no longer fits.

I suspect the porphyry pivot will ultimately look less like a bet and more like the only move that made sense.

@TigerStars @Daily_Discussion @Tiger_comments @Tiger_SG @Tiger_Earnings @TigerClub @TigerWire