Rocks And Stocks News Report On Gold
Companies discussed include; McEwen Mining, McEwen Copper, Goliath Resources, i-80 Gold, Galantas Gold, Amex Exploration, Silvercrest Metals, Puma Resources and Canadian Goldcorp.
Many times in my reports over the years I have said that economics has a way of fixing stupid. For much too long, the economies of the world have been built on debt, much of it at near zero after the 2008 economic meltdown. This is an unsustainable path and many central banks are coming to this realization and taking the action of buying, and holding I might add, gold.
Since the 2008 economic meltdown, many central bankers have been consistently increasing their gold reserves. 2022 was a record year in this trend and 2023 is on pace to be even bigger.
The Federal Reserve would have you believe this is complex economics. You don’t need a degree in economics to understand that if you build economies on near zero interest rates since the 2008 economic meltdown. Then crank up interest rates rapidly from 2022 until recently, you are creating a challenging economic situation. This is simple math, not complex economics.
The braintrust at the Federal will not take credit for the inflation they caused with the prolonged free money era. Nor will they take credit for the economic problems they are creating with jacking up interest rates so rapidly.
Nonetheless, the ramifications are undeniable. Currently, the debt payments on the federal debt is over $1 trillion and growing. I’ve called this a death spiral of debt because it is pretty much unstoppable with the debt level compared to GDP, the relentless government spending causing huge deficits, two wars to fund that could bring in more countries, and the interest rates.
Many countries are seeing the risks of holding US debt and currencies in their reserves and are loading up on gold. Creating somewhat of a new gold standard. The Dutch Central Bank recently announced they are going in this direction. Several other countries may not have officially announced it but they are also going in that direction.
It wouldn’t surprise me to see silver being added to their reserves while demand from the solar industry is rapidly growing. With silver demand coming in at higher levels than the Silver Institute predicted causing them to increase their forecasts. In reality, I wouldn’t just use gold and silver, I think it is time for countries to also look at strategic reserves of copper and other critical metals. At least to a level that meets their domestic needs.
Another important factor to consider is that many of the countries in the BRICS network are buying gold hand over fist. There is plenty of speculation that they want to develop an alternative world reserve currency to compete with the USD. What is less talked about is that their near term goal could be more focused on alternatives to world trade that is dominated by the USD. We are seeing moves for countries to create agreements to use their domestic currencies for trade.
We will likely see more of this, especially if the USD goes under significant pressure which could be on the immediate horizon. Gold could play an important role in world trade as it is trading at all time highs against many currencies. It could be an excellent alternative compared to countries being in a race to the bottom with their devalued purchasing power from their domestic currencies.
Key roles it plays is protecting wealth and purchasing power. Many currencies have been pummeled, if folks in those countries had owned gold instead, they would have seen their purchasing power increase instead of get wiped out. The US is likely next with their out of control debt and aggressive use of their currency printing press.
The aggressive moves by the Fed to combat the inflation they caused has been bullish for the USD, but that party seems ready to turn out the lights soon. The pace of ratcheting up interest rates from their near zero is fairly unprecedented. Earlier this year we saw cracks forming when there was a bank run on a group of regional banks.
The Fed and Treasury were able to put their fingers in the dam to stop it from bursting but didn’t fix the underlying problem. These banks loaded up on near zero interest rate debt, when depositors decided to withdraw deposits en masse, it showed that they were insolvent. Sure they could hide from this issue by not marking to market their assets, but when they had to mark to trade, it was revealed they were in fact insolvent.
They aren’t the only banks and institutions on a collision course with insolvency. Many have been able to hide behind not marking to market their assets and pass less than rigorous stress tests. This doesn’t change the fact that they are loaded up with troublesome assets that if they ever need to mark to trade them will hit the wall of insolvency.
They are no different than the Fed itself which is sitting on the biggest pile of troublesome assets. Sure it can print money, but this doesn’t hide the reality of the ticking time bomb they are sitting on.
Consumers are in a tough spot as well, they haven’t had much in the way of wage increases for decades. The Fed induced inflation is playing havoc on the average consumer. Made even worse by the fact that they are needing to use their credit cards to make ends meet while paying over 20% interest rates thanks to the not so friendly Fed jacking up rates.
We are seeing increased delinquency on credit card debt and car loans. The regular folks are under a lot of pressure from the Fed’s actions to create debt then fight what they considered transitory inflation that is stubborn and far from transitory. For a long time, consumers were able to combat their own debt issues due to the housing bubble that elevated the value of their key asset.
The housing market is showing signs of serious strain from the rapidly increased hiking of interest rates after the near zero interest rate era with housing sales having dropped dramatically. The commercial real estate market is even worse and is a looming problem that will likely cause shockwaves.
Commercial real estate is suffering from a two-punch combination that it will not be able to withstand. During the Covid pandemic, many people were forced to stop going into the office and work from home. They came to realize that they really didn’t need to sit in traffic to commute while getting to work in their offices. The result of this trend is that commercial real estate owners have brutally tough vacancy rates.
Like the housing market was built on the near zero interest rate era, commercial real estate was even more leveraged with debt. Much of the debt is about to roll over, so they will have to go to their creditors with high vacancy rates that will make it so they can’t service the current interest rate environment.
All of the issues mentioned will force the Fed to stop interest rate increases. Then they will have to lower interest rates and start rebuilding the house of cards. This will put pressure on the USD and be very bullish for many commodities. On the world stage, the most watched price of commodities that drives investors sentiment for metals and the metals stocks are what metals are doing in USD terms. The lowering of interest rates is likely a lot closer than many currency traders believe and will likely get the rates back to near zero much faster than most can imagine.
Even investors that are bullish on metals, don’t believe supply and demand matters. It doesn’t, until it does.
For too many years the miners of gold and other metals have relied on their old mines which are getting long in the tooth. For way too long, not enough money has gone into exploration to find new mines, and for those in development to build new mines. The pipeline of future supply for gold and other metals is for the most part bare. What is in the pipelines for many metals is not going to be able to meet the demands.
Recently, I had an interview with Rob McEwen from McEwen Mining, a legend in the mining business from building Goldcorp from a small gold miner to an industry leader in low cost, high-grade gold mining that generated a lot of free cash flow which made it one of the top performers in the gold mining sector under his tenure. He has also been very successful at investing in the mining sector and is an astute observer of the history of mining, economic history and a highly sought after thought leader.
Something he pointed out is that gold mining as well as other metals mining isn’t just suffering from under investment for much too long. It also has a significant structural problem. Not only does the mining sector not have enough young folks coming into the sector, it also has a problem attracting young investors.
I saw this first hand during my career in the mining sector. I started in the business in 1993 when I was in my late twenties. The 80s had been hard on attracting new blood into the business, and the 90s weren’t much better. Back then there weren't a lot of people in their 20s or 30s working in the mining industry. Many young people just felt it was too hard of a business. This period in mining was called “The Lost Generation.”
The 2001 to 2011 bull market in metals helped the problem, but then after that we saw another Lost Generation kick in. The result of this is troublesome for the mining industry, you need people to do exploration, to build and operate mines, but the talent pool is strained.
He also talked about the need for a youth movement of investors in the sector. He mentioned that he goes to a lot of investor conferences where he is a keynote speaker and when he looks out in the audience he sees a lot of grey haired people and not a lot of young people.
One of the things he sees as a problem is the perception of mining. Which in a lot of instances was caused by small artisanal miners that did bad things to produce gold and other metals. This isn’t to say that the big industrial mines didn’t have problems, but they have done a good job of cleaning up their acts.
This doesn’t change the perception even if the reality is that most of the problems now and into the future will come from small miners using too many chemicals and not enough concern for where those chemicals go. It won’t be from large industrial mines, they have to be very careful or risk losing their cash machines.
Rob McEwen has been an innovator in the mining sector going back to the “Goldcorp Challenge.” What they did way back then was open source their geological data and ask people from all over the world to help them decide where to drill their project with a substantial cash reward.
This resulted in transforming Goldcorp from a small struggling mining company that drilled deeper, well below their mining operations. They hit remarkably high-grade gold that was a game changer that enabled them to become a low cost producer of very high-grade gold.
He is putting his money where his mouth is again with McEwen Copper which is a subsidiary of McEwen Mining which owns around 48% of the shares in the subsidiary. At McEwen Copper they are working on a plan to build a mine of the future that will be a model for new mines. With an added benefit of potentially changing the perception of the mining sector.
If you go to their website, you can find the architectural rendering of the plans for the mine of the future which was designed by a person considered the Steve Jobs of the green living and working space. It is designed to grow its own food, treat its waste and efficiently use water for the workers as well as the mining operation. It is unlike any mine you have ever seen before but I truly believe it will become the mine of the future that other mines will be modeled on.
Another thing we discussed is that Rob and Frank Giustra have shared the stage at a couple of recent mining conferences. In the case of Rob McEwen most of his wealth has come from his success as a mine builder and investor in the mining sector. A good portion of Frank Guistra’s wealth has come from mining as well. They are both visionaries that got in early on trends, worked hard, built successful mining companies and made lucrative investments.
I watched these talks they did with great interest, appreciating them discussing the challenges and opportunities for investors in the mining sector. Something that stood out was when they were reminiscing about the early days of Goldcorp and how they came together to help make it a big success.
They talked about how the late 90s and early 2000s was a magical time. Frank Giustra was not so confident we could see another magical time because the people have changed. He mentioned that he just doesn’t see the same kind of people in the industry as back then, especially in investment banking, but did leave the door open and made a challenge to some of the investment bankers in the audience.
Rob McEwen on the other hand is convinced we are at another magical time in the mining sector. He sees the parallels between back then and now. I do as well, back then, valuations and sentiment for mining stocks was dismal. It wasn’t much better for metals as gold was trading for under $300 an ounce and copper was trading for around 60 cents a pound.
As they say history doesn’t always exactly repeat, but it often rhymes. Here we are again, mining stock sentiment is dismal. What is different is that gold is knocking on the door of $2000 per ounce and copper is around three and a half bucks. The metals prices are pretty solid, while the mining stocks are coming from a very low base like in the late 90s and the year 2000.
It took many years for us to be able to look in the rear view mirror and see that the late 90s and early 2000s was a magical time. To be honest, I was in the mining business then and it didn’t feel like it back then. It felt more tragical than magical. I’m in the Rob McEwen camp and think we are at another magical time for mining that we won’t really realize it as such until we see it in the rear view mirror.
That is a good point to transition to discussing a group of companies that I follow closely in the Rocks And Stocks News report as they are either picks or sponsors.
McEwen Mining
A few years ago I first interviewed Rob McEwen, as McEwen Mining was going through a tough time due to production problems at their gold mines. A little over a year ago, I saw the potential they had at their subsidiary McEwen Copper.
Their stock had been punished and the copper project was not being recognized. I reached out to Rob to ask if he would come on my show for an interview. This started a series of interviews, from when the valuation was less than half its current valuation a little over a year ago.
We talked about the efforts they were making to turn around the gold mines and a lot about the potential of McEwen Copper. Shortly after, they attracted a significant investment by Nuton, a Rio Tinto venture, that has a proprietary method to increase copper recoveries and do it faster.
This was followed by a big investment from Stellantis, one of the top car builders in the world. This Stellantis investment was the first time a major car maker invested in a copper project.
Nuton has been busy working to assess if their technology can benefit McEwen Copper’s Los Azules copper project and made a second significant investment in McEwen Copper. These investments by Stellantis and Nuton have helped folks better understand the potential of McEwen Copper.
What is less appreciated is the growth potential of the McEwen Mining gold mines. It was not lost on me that in their recent quarterly report they reported spending a lot of money on exploration. This is right out of the Goldcorp playbook. Which transformed them from a struggling gold mine in Red Lake that drilled below the mine workings and struck it rich drilling into very high-grade gold that was low cost to mine and generated a lot of free cash flow.
Under Rob’s tenure he built Goldcorp from a small gold miner, to a big winner that was transformed with the drill rig. The gold mines in Ontario are in a similar geological setting as the Red Lake Mine. Most of the mining has been done relatively close to the surface. Now they are aggressively drilling to find more gold and having success finding high-grade gold.
I don’t think many believe that McEwen Mining’s gold mines can find game changing results with their drilling. I’m not of that opinion and will continue to eagerly watch the results from their drilling efforts. While also watching the impressive developments at their McEwen Copper division.
Goliath Resources
Originally, when I started following Goliath, it was because of their Surebet zone. It is very impressive being around 1.8 square kms from one side of a mountain to the other, with around 700 metres of a vertical dimension from top to bottom. They have modeled it to be 5.5 million cubic metres, with a 2.9 specific gravity, an average thickness of 6.88 metres and an average grade of 6.31 g/t gold equivalent. If you run the numbers on it alone, it is clearly a multi million ounce target.
To make the Golddigger project even more impressive is the Bonanza zone which is a horizontal body that cuts across the dip of the Surebet zone. Bonanza doesn’t have as many holes in it as Surebet. It is even bigger than Surebet and this year they got a bunch of holes in it and will be able to provide more accurate data on its dimensions and average grade soon. Based on its size, it is clearly a second multi million ounce zone.
Surebet and Bonanza are found in the sediments. This year they made a game changer discovery in the Golden Gate zone which is in the volcanics immediately below the sediments.
In the volcanics they have hit some of their best grades and thicknesses to date. Including one of their best hits of 65 g/t AuEq over 7.90 meters at the contact of the sediments and volcanics at the Bonanza zone. Below that, in the volcanics, they hit the Golden Gate zone which returned 34.03 g/t AuEq over 9 metres.
Surebet and Golden Gate are parallel and are likely the same system that is slightly offset as they get into the volcanics. If you consider the dimensions of Surebet and that it is the extension of the system and farthest from the heat engine source, it is an extremely impressive system.
It suggests the mineralizing system is very big, long lived and high-grade with the potential to get even higher grade as they drill closer to the heat engine that caused all the mineralization. The reason the Golden Gate zone is a game changer is that it extends the system into the volcanics and indicates the system is getting higher grade as they get into the volcanics. It is also important to point out that Golden Gate is the distal portion of the system in the volcanics.
Which begs the questions, where did Bonanza come from and how far is it from the heat engine that caused its mineralization and will the grade get higher the closer drilling gets to its source?
Last winter, they did a few studies that make this project even more impressive. One of those was that they had an independent engineering firm model what they had found with their two previous seasons of drilling. It revealed that they were looking at two zones, Surebet and Bonanza.
Another important study they announced was the metallurgical work that showed it is easy to recover the gold with a very high recovery rate.
The Colorado School of Mines reviewed the geology of Golddigger and the drilling and wrote a paper that came to the conclusion that the source is deeper. When this was announced it left the impression the source was very deep, what was less understood is that there has been a lot of erosion which makes the source much closer to the current surface.
Goliath still has around 100 holes to report from this year’s drilling. I imagine over the winter they will do more studies to better understand this world class discovery which clearly shows the potential of being a Tier 1 project in the prolific Golden Triangle of British Columbia.
They have recently gone to a couple important mining conferences and have several more to go to over the next several months which will give them a chance to market what they have found.
I’m tremendously excited about next year’s drilling. In conversations I’ve had with Goliath CEO, Roger Rosmus, they believe that Golden Gate is a game changer that could prove the Surebet and Bonanza zones are the icing and Golden Gate is the cake. So, they plan to make drilling into the volcanics below the sediments that host Surebet and Bonanza their primary focus.
Based on the dips of the parallel Surebet zone and Golden Gate clearly shows they are likely part of the same system. Another thing that is apparent is that based on the drilling to date, there is a real possibility that in the volcanics they could find stacked zones.
From what they have seen from their drilling in the sediments and volcanics, considering the zonation of grade in a mineralizing system, there is the potential that the holes into the Golden Gate zone are at the top of the zone in the volcanics, and as they get further into the volcanics and closer to the feeder of the entire system that the high grades could could continue or even increase.
When I look at everything that has been reported so far, it is clear to me that they have one of the most important new discoveries in the Golden Triangle in many years. It can’t be ruled out that they may have found the most important new discovery ever in the Golden Triangle.
That is no small statement because the Golden Triangle is very prolific with many high-grade deposits. I don’t take it lightly, I follow this region closely, the geology, structures, and drilling at Goliath’s Golddigger project are all pointing in the direction that this potential is not out of the realm of possibility.
They don’t have to find the best discovery ever in the Golden Triangle to be a success story, I certainly like their chances to have an important mine of the future and it makes it one of my favourite gold discovery stories.
Goliath Resources is a current sponsor at Rocks And Stocks News, Allan Barry Laboucan is the owner of Rocks And Stocks News and holds shares in Goliath and warrants to purchase shares.
i-80 Gold
I-80 Gold became a publicly traded company a couple years ago after Premier Gold was bought out and the Nevada gold projects they held were spun out to create i-80 Gold. The company is run by Ewan Downie, as was Premier Gold, and he had another success when Wolfden Resources was bought out years ago.
Before Wolfden was bought out for their base metals project, they spun out the gold projects to create Premier Gold. Wolfden was a success story, as was Premier Gold.
All of his companies were sponsors of my reports so I’ve sort of had a ringside seat and been able to interview Ewan many times over the past 20 years or so. He has key skills in deal making, then extracting value out of projects with the drill rig.
One of the projects spun out from Premier was the Cove project. It has over a 1 million ounce resource with an average grade of around 12 g/t gold. Making it one of the highest grade undeveloped gold projects in North America.
After listing i-80 Gold they got their hands on the Granite Creek project, which is right beside a huge gold mine, in the same rocks and structures. Drilling at Granite Creek below the historical mine working hit excellent grades in the Ogee Zone.
Then they started drilling below that and in the direction of the big gold mine next door and tagged the South Pacific Zone. It was a game changer and propelled it to be their top project. It has continued to grow, it has an excellent strike length, and thick intersections of high-grade gold that remains open along strike to the north and at depth. In fact, as they go deeper, the grades increase. It is an excellent deposit that will become a mine in the immediate future.
Around this time last year, they started drilling into spectacular grade CRDs at their Ruby Hill project, after they had already hit a Carlin style gold deposit nearby. Following that they drilled into a high-grade skarn deposit and recently into a high-grade sulphide deposit. The Carlin gold deposit, CRDs, skarn and sulphide deposit are all in close proximity.
They are so close that they can all be accessed from the same underground working network. In their current corporate presentation you can find an image of the planned underground workings to access the various deposits.
Developing three deposits toward mines is challenging and many were questioning how they would be able to do it all and advance their two processing facilities. Recently, they put out news that they had signed a non-binding term sheet with an unnamed company.
This potential deal is all about the base metals at the CRD and skarn, with a base metals focused mining company. The goal is to advance them with additional drilling and start building the underground workings.
But, when the audience of investors and potential investors saw a non-binding term sheet with an unnamed company, many started asking a lot of questions. Primarily what are the terms and who is the company.
Obviously, they didn’t want their name out there, likely for strategic reasons, while doing their due diligence and working on the paperwork for the deal. Which brings me back to the history I mentioned earlier about Ewan Downie. We did a recent interview about this news and I said that I have a lot of confidence in this being a good deal for i-80 Gold because of watching Ewan pull off a lot of great deals in the past.
Another thing I got from the conversation is that the potential deal is about being able to follow through on the underground workings plan. Until the details are announced, we will all have to wait.
In the meantime, they are drilling away on their projects and should have plenty of assay results to announce as well as updated resources because most of their drilling over the past couple years is not in the current resources. They have done a lot of drilling and in many cases their drilling has hit grades substantially higher than the current resources.
i-80 Gold has stated their goal is that they want to become the second largest Nevada focused miner only behind the joint venture between Barrick and Newmont. That is a lofty goal, but they have the deposits, the processing facilities, and the ability to keep producing with a strong growth profile to increase production that would give them one of the top growth profiles amongst their peers.
The bottom line for me is that Ewan Downie has had plenty of success in the mining sector and I strongly believe that i-80 Gold will be his biggest.
I-80 Gold is a current sponsor at Rocks And Stocks News.
Galantas Gold
I’m a big fan of orogenic gold projects, Galantas has one in Northern Ireland. Whether looking at the Red Lake Mine or Fosterville, both orogenic gold mines, you will see very high-grade mines, with low costs to mine gold, that were free cash flow generating machines.
Some things stand out to me at the orogenic gold system that Galantas has found. There are a group of north to south high-grade gold zones in close proximity. To the immediate south is an east to west structure.
To have an important orogenic discovery you need a few important things, one is a deep crustal structure that is the conduit for the gold mineralization from deeper in the crust to make its way close to the surface. Secondary structures coming off the deep crustal structure the gold can make its way into. Then most importantly you need high-grade gold mineralization. Galantas Gold has checked off all these boxes.
It is important to point out that their drilling has been confined to the first few hundred metres from the surface. Orogenic gold deposits have very deep roots. Take the Red Lake Mine for example, it had been a struggling mine for many years, then Goldcorp drilled below it, at around 1000 metres below the surface they tagged into the bonanza-grade portion and it kept going and going and the rest is history.
That depth potential remains to be tested at Galantas’ orogenic gold system. They have some help unlocking it. There was historical mining that enabled them to go underground and see the rocks and mineralization. As they have drilled they encountered a series of dilations zones that can help them target where to drill deeper.
Recently, they added a compelling VMS project to their portfolio in Scotland. The British Geological Survey had done analysis of the project and showed it has excellent potential, but minimal exploration had been done. That is until Galantas went in recently to drill, finding high-grade copper and gold in the VMS over significant intersections. This discovery is in its early days but is off to an excellent start.
Galantas now has two excellent projects to drill, one an impressive orogenic gold system and the other a VMS that are well known to occur in clusters.
Galantas Gold is a current sponsor at Rocks And Stocks News, Allan Barry Laboucan is the owner of Rocks And Stocks News and holds shares in Galantas and warrants to purchase shares.
Amex Exploration
I’ve been closely following Amex since their early holes into a high-grade orogenic gold system at their High Grade Zone. It has excellent continuity and extends from near the surface to over 1000 metres below surface.
Right beside it they have a high-grade gold open pit discovery at the Denise zone that shows the potential for a high-grade underground target that gets very close to the High Grade Zone.
Additionally, they have found other high-grade zones in close proximity to their High Grade Zone. Where the source is to all of this mineralization remains to be found, but it is clear they likely have a mine of the future. Probably starting with the open pit target that will enable easy access to the underground mine target at the High Grade Zone.
They are right beside the town of Normetal which was built because of the Normetal Mine. The project is in Quebec which is one of the best mining jurisdictions in the world. They have road access, they are so close to the town that they have cell phone coverage right on the property.
The project is only a few short kilometres down the road to Normetal so there is no need to build a camp and they have their core shack right in town.
They have also done metallurgical studies and the gold is easy to get out of the rock with a very high recovery rate.
All of these factors combined is why I have the confidence to comfortably say that they have a future mine. The only questions left are how big it will be, and who will mine it because I doubt it will be Amex. Ultimately, I think this will be developed into a mine by a much larger company.
Amex Exploration is a past sponsor of Rocks And Stocks News, we have recently reached out to them inviting them to resume being a sponsor.
Silvercrest Metals
I’m always on the hunt for low cost, high-grade mines because they can be such profitable mines. Too often I think folks running mining companies and those that invest in them think bigger is best.
Yes, big can be great, but high margin mines make a lot of money and have a way of turning small mining companies into much bigger mining companies.
When Silvercrest built the Las Chispas mine and brought it into full commercial production a couple quarters ago they were sitting on a significant amount of debt they needed to build the mine.
In the first two quarters of full commercial production they have paid off all their debt and built up close to $100 million of cash in their treasury. That is what happens when you mine at a low cost and mine high-grade silver and gold.
They are mining silver and gold from epithermal veins, with a surrounding cluster open for expansion. They haven’t become a darling of the market yet, because they did their feasibility studies a few years ago, before the inflation of the past couple years kicked in. So the costs of production are higher than in the feasibility study.
Nonetheless, they are mining silver for around $13 per ounce and selling it for north of $20. That is why they have been able to pay all their debt off, build up a lot of cash and buy back stock.
Now the question is how long will their mine life be. Epithermal veins often start with modest mine lifes, then as they keep the drill working while they are mining they replace what they mine with the drill rig.
Take for example the cluster of epithermal veins at the city of Fresnillo in Mexico. They found them outcropping, started mining them and have been in production since the 1500s. The region around them has been the source of 10% of the silver ever mined in the history of mining silver world wide. It is one of the most important precious metals mining regions anywhere in the world.
Within a couple thousand metres of Fresnillo, MAG Silver in partnership with Fresnillo PLC found and built a mine. That mine will make them the two lowest cost silver miners in the business.
Where you find one epithermal vein you usually find more as they occur in clusters. So far, Silvercrest is focused on mining a couple veins but they have many more known veins in their cluster that will likely keep them busy mining for well past their current mine life estimates.
Las Chispas is in Sonora, Mexico which has several mines and mining prospects with all the claims in the area owned by majors, mid-tiers and juniors. In a recent interview, Silvercrest’s President talked about the advantages they have for exploration in the region. They already have a processing facility built and operating that has paid for itself.
Which takes that burden off other veins on their ground. He also talked about their 30-60-90 kilometre plan for potential to buy other deposits around them that could truck their material a short distance and use the Las Chispas processing facility, which lowers what needs to be found and mined.
They see this as a viable growth strategy. They could have competitors, such as First Majestic which is to their immediate south where they have an excellent mine at Ermitano. He also mentioned that they are watching a couple juniors in the area that are trying to raise money for drilling.
I know this region well, and know a junior very well that has over 50 square kms of ground to their immediate north with two known epithermal veins that have been underexplored with minimal drilling. So it is clear that their 30-60-90 plan makes sense as does their exploration on the veins in the cluster on their own claims at Las Chispas to replace what they are mining in their current epithermal vein mines.
With the free cash they are generating from Las Chispas, they can keep building up their cash, fund mergers and acquisitions, keep buying back their own stock and in the not too distant future possibly pay dividends.
Ultimately, I can clearly see they are on a growth path to become a much larger gold and silver mining company.
Puma Exploration
They have an excellent orogenic gold discovery emerging in New Brunswick. So far, their drilling has been confined to the first couple hundred metres from the surface. They have an excellent distribution of high-grade gold along the strike length they have drilled. Most importantly, the continuity of the high-grade gold along strike and at depth is impressive.
As the gold mineralization starts right at the surface there is realistic potential that they could get at it with an open pit that transitions to underground mining. With the grades they have, it could be extremely high-grade for an open pit.
The along strike dimension is open as is the depth potential. They have a nearby geochemical anomaly that is very close by that could be the extension of where they have focused their drilling so far. They have several other geochemical anomalies that look much like where they have been drilling.
I’m very eager to see them drill deeper because I think they may have only drilled the tip of the iceberg so far.
Puma Exploration was a part sponsor of Rocks And Stocks News until recently.
Delta Resources
I’m very impressed with what Delta Resources has drilled into so far, right beside the Trans-Canada highway, just outside Thunder Bay, Ontario. Their drilling has outlined a large area with gold grades that would make for an excellent open pit. I was early in covering Osisko Mining’s Malarctic project and I’m getting that Osisko feeling with Delta.
What also has my attention is that the system they are drilling into also has extremely high grades of gold as well. How the high-grade and open pit target formed and their association remains to be seen.
Another parallel they have is Osisko’s mine was under a small town that needed to be moved, which they proved could be done thus proving the many doubters wrong. Delta’s discovery is right below the Trans-Canada highway, if they have a mine it would need to be diverted somewhat.
Diverting a highway is not nearly as big of an issue as moving an entire town. You really couldn’t find a potential open pit mine in a better place than what Delta has found. It is so close to Thunder Bay that mine builders and mine operators could stay in town, sleep in their own beds and have a short commute to the project. It also affords them almost year round exploration.
They are cashed up to do a lot of drilling, have done a lot and have a lot of pending assay results. Plus, they have a large land package so they have the potential to find more discoveries. In fact, they have already found other targets similar to where they are focusing their current drilling.
I’m looking forward to seeing where their current drilling takes them and the pending assay results as well as future drilling on their other targets.
Delta Resources is a current sponsor at Rocks And Stocks News.
Canadian Goldcorp
This is a junior with a past producing mine that didn’t see enough deep drilling and has Rob McEwen as a very large shareholder. I made them a pick and started reporting on them when Rob McEwen vended in a couple projects that made him a big shareholder.
What impressed me was that the high-grade gold zone that was mined had excellent continuity of the high-grade and the known zone was pointing to depth. The resource was confined to the first seven hundred metres from the surface.
Importantly, if you follow the dip of that zone, it goes deeper to where they had drilled a couple historical holes and had high-grade gold over thick intersections.
Canadian Goldcorp drilled into that deeper area and hit excellent results. It is still early days for the deeper part of the system, but so far it is a very compelling target.
They recently changed leadership with a new CEO. I’m trying to arrange an interview to discuss his vision for the company.
All the best,
Allan Barry Laboucan
Rocks And Stocks News does not make buying or selling recommendations. The reports are for information purposes only. Sponsors pay a fee to Rocks And Stocks News for content creation. This funding helps cover the costs of research and reporting on the sponsors and picks that aren’t sponsors. Before making any investment decision it is important for you to speak with your financial advisors to consider your risk profile. It is also important to do your homework. To help in that process, Rocks And Stocks News means to be a gateway by doing reports and interviews of management of sponsors and picks. The reports and interviews should not be considered investment advice. Allan Barry Laboucan is the founder and owner of Rocks And Stocks News, he has worked in the mining sector since 1993 and has been reporting on the sector since 2005. He has worked with and been mentored by very talented geoscientists in geology, geochemistry and geophysics. He uses the skills he has picked up during his career to assess sponsors and picks in the reports. Whether a company is a pick or a sponsor they go through the same filter and are reported on when important news is made that Allan Barry Laboucan wants to discuss on the Rocks And Stocks News platform. He may own shares in sponsors and picks for investment purposes.