i-80 Gold And Paycore Minerals Have Bonanza-Grade CRDs And i-80 Gold Makes Offer To Buy Paycore Minerals
This takeover will combine two remarkable CRDs with exceptional grades of silver, lead, zinc and gold into one big project.
I strongly believe the short term strength in the USD and weakness in gold is overdone for both. As is often the case, we can see short term counter moves in bearish and bullish trends. Which is exactly what we are seeing with USD overbought in a bearish trend that started in September, 2022, and gold oversold in a bullish trend that started in November, 2022.
More evidence we are in the early days of a gold bull market is that consolidation has picked up. In fact, a couple days ago two sponsors of the Rocks And Stocks News reports, i-80 Gold and Paycore Minerals, announced a friendly takeover. It makes me proud that we recognized the quality of their projects in Eureka, Nevada early, interviewed them regularly when news was out and covered them closely in sector reports.
On Monday, I did an interview to discuss the transaction with Christina McCarthy, CEO of Paycore Minerals. I’m also working on setting up an interview with Ewan Downie, CEO of i-80 Gold. They are both at the BMO Mining conference in Florida and I’m sure they are the talk of the show. After this they will be on their way to the PDAC for further marketing of the transaction.
I believe this is an excellent deal for both companies. The Paycore Minerals shareholders will become shareholders of i-80 Gold which has a pipeline of projects to turn them into a multi billion valuation company at several multiples of their current valuation.
For i-80 Gold they consolidate the re-emergence of the historically important CRD mining camp just outside of Eureka, Nevada. From the 1860s to the 1960s this was an important CRD mining camp that then went dormant for decades. i-80 Gold and Paycore have brought it back to life with the tremendous success they have had drilling.
It really got exciting in November, 2022 when both companies put out exceptional drill results. With high-grades of CRD metals, silver, lead and zinc with overprints of high-grade to bonanza-grade gold. The two CRDs are truly remarkable with some of the highest in situ metals value in the rock being found anywhere in the world.
i-80 Gold has hit a bonanza-grade CRD at their Hilltop discovery that has morphed into a series of CRD zones. Paycore has done the same at their project approximately 2000 metres away. They share the same corridor of faulting, which are the cracks in the earth that are the path of least resistance that the metals bearing fluids follow. In addition, they have the same rock packages extending from Hilltop and throughout Paycore’s claims.
In between their respective bonanza-grade CRDs is a big geophysical anomaly, contained on i-80s ground, covering key faults that are on both companies' projects. There is a very good chance that the geophysical anomaly is the source of the CRD deposits on both companies' claims.
After i-80 Gold takes over Paycore Minerals, the shareholders of Paycore will get exposure to the potential of that geophysical anomaly if it proves to be the source of the mineralization on both companies' grounds.
Another big benefit to Paycore shareholders is that i-80 Gold has the production facilities next door to process the rock if Paycore’s FAD CRD proves to be a mine. Which I think it will.
I look at the Lassonde Curve a lot and I think putting this transaction into the context of that indicator helps emphasize the benefits.
As is often the case in a takeover offer, some of the shareholders of the smaller company feel they could have got more. In the Lassonde Curve there are two big moves when a junior has success. One is upon exploration success, the other is when the project goes into production and in between is a development discount window that can last 5-10 years that is painful for shareholders.
If one argues that Paycore Minerals still has more room to grow on the exploration success ramp up. They would also have to consider the company would have to go through a long development discount window as resources calculations are done, then economic evaluations, then permitting a mine and finally building it and putting it in commercial production.
Another massive benefit for Paycore Minerals’ shareholders is they also get exposure to i-80 Gold’s other projects. At the Ruby Hill project it looks like i-80 Gold has a world-class gold project to the west of the Archimedes pit and a skarn deposit to the east. With the Hilltop bonanza CRD to the south.
In addition to the immediate south of Hilltop, completely on i-80 Gold’s ground is an important geophysical anomaly that Ewan Downie thinks is one of their top targets.
Another important geophysical anomaly is directly below the Archimedes pit that could be a big porphyry target. In recent comments, Tyler Hill, one of i-80 Gold’s key geologists has pointed out that porphyries associated with CRDs often have high-grade copper and gold mineralization.
Paycore Minerals’ shareholders also get exposure to i-80 Gold’s Granite Creek project which looks like a world-class gold mine of the near future. The South Pacific zone has high-grade gold over a 600 metre strike length with excellent continuity. It is open at depth and to the north. As they go deeper the grades get higher and the depth potential still needs to be drilled. Following it to the north is very exciting as the rock packages and fault continue to the north where there is a 25 million ounce gold mine. It is truly in elephant country and has the potential to easily be an enviable multi million ounce gold mine.
Granite Creek and Ruby Hill are past mining projects, with advanced permits to move them quickly into production. Going back to the Lassonde Curve i-80 Gold has a clear path to narrow that development discount window down to months instead of years.
The synergies of consolidating the i-80 Gold and Paycore Minerals claims and deposits in Eureka, Nevada are readily apparent. i-80 Gold adds another world-class project to their portfolio that will need the mining infrastructure to bring it into near term production if it proves to be a mine. Paycore’s shareholders don’t need to go through a long development discount window and get exposure to the remarkable assets that i-80 Gold owns.
Another factor to consider is the catalyst of gold moving higher will bring more attention to both companies. I can see a resumption of the gold bull market that started in November, 2022. This has the potential to move both companies higher as they are working through the takeover as do more drilling from both companies that could add more excitement.
As always, my reports are for information purposes only, they are not investment advice, it is important for you to speak with your financial advisors to determine if the companies I report on are suitable for you.
I’m also a big promoter of investors doing their homework, I’ve done interviews with management of most of the companies I follow. You can find those interviews on my Youtube Channel, search for Rocks And Stocks News, which is a good place to start your homework. The websites of the companies I follow have plenty of information in their news releases and corporate presentations to do additional homework.
Ultimately, well informed shareholders that understand the companies they invest in, and have reasonable time frames for companies to reach their success, are prone to make logical investment decisions not emotional ones. This is a recipe for success investing in any sector.
All the best,
Allan Barry Laboucan