Is it too early to declare Game-On for the junior exploration arena? The recent across-the-board price action looks and feels right. In many cases, good news is greeted with positive market depth. And the market appears to have more than lint lining its pockets.
Earlier last week I came across a chart supporting the notion that Peak Gold might be a real thing… that it might be more than idle conjecture.
For the uninitiated, if we’re at Peak Gold, it means that the low hanging fruit is gone, that the vast majority of our planets high-grade near-surface ore bodies have already been discovered.
When asked for his views on the subject Ian Telfer, one of the biggest and most respected names in the industry stated:
“Are we bad at finding it? Or have we found it all? My answer is we found it all.”
The chart I was hinting at, courtesy of S&P Global Market Intelligence…
Compelling, this chart supports my view that the companies we track here at Highballerstocks have an endgame, that is, they’re in the cross-hairs of resource-hungry predators looking to ensure their long term survival by bulking up their project pipelines.
If you’re convinced your company has an endgame, be right and sit tight. A takeover offer from a larger entity will likely come at a premium that far exceeds the current valuation of your stock.
A successful endgame removes all the guesswork from deciding where and when to exit. Have patience. Wait for the predator to cash you out.
The companies
Covid-19 gave the Yukon Territory a pass for the most part. There were only 11 cases. No hospitalizations. No deaths.
During the Covid downtime, companies like Banyan Gold (BYN.V) kept busy working on their geological models, honing and prioritizing targets that will see a proper probe with the drill bit this upcoming field season.
Speaking of Banyan, the company dropped a maiden resource estimate for its Aurex and McQuesten properties (aka AurMac) just a few hours ago:
These 900k-plus Inferred ounces, at a .2 g/t Au cutoff, lie near-surface and are readily road accessible. These Inferred ounces also blew away my expectations for AurMac.
Noteworthy: if you increase the cutoff by 50% (to .3 g/t Au), you lose less than 15% of the ounces but gain a 20%-plus grade. Nice little detail, that.
This pit constrained resource is contained in two near/on-surface zones: Airstrip and Powerline.
This 92 square kilometer property has seen little in the way of modern exploration. But the new higher-grade Powerline Zone, a parallel structure located one kilometer to the south of Airstrip, is where the ounces could pile up in a hurry.
Powerline begins at surface and is open in all directions from the 250-meter x 250-meter area drilled to date.
Ultimately, these two zones could link up, forming one continuous deposit.
Banyan CEO, Tara Christie, having operated one of the largest placer mining operations in the Yukon, runs a tight show. For a Yukon ExploreCo, Banyan’s burn rate is low. Example: diamond drilling costs at AurMac ring in at a modest $220 per meter.
It cost Banyan roughly $1.8 M or $2.00 per oz to bring this resource to the table.
CEO Christie on this maiden 43-101:
“We are excited with the value this initial Mineral Resource estimate generates for our shareholders, particularly given the modest exploration expenditures by Banyan, generating ounces at less than $2 per ounce. Both deposits are open, with mineralization known to extend beyond the current block model boundaries. Further, examination of the Airstrip Mineral Resource model highlights its robust nature; when the cut-off grade is increased by 50%, to 0.3g/t, less than15% of the ounces are reduced; while, the grade increases by more than 20% to an average of 0.65 g/t. Additionally, the deposit model exercise has identified a series of drill targets, which we are confident will meaningfully build upon this initial Mineral Resource.”
Adding to the ounce count, the company’s 18,620 hectare Hyland project sports an Indicated resource of 236,000 AuEq ounces at 0.85 g/t Au, and an Inferred resource of 288,000 AuEq ounces at a similar grade.
We covered Banyan in some detail back in mid-February of this year:
Banyan Gold (BYN.V) – resource expansion and discovery potential in the Yukon
The company will be putting boots to the ground in the first week of June. For now, it looks like AurMac will see 1,500 meters of drilling. The program is expandable should early results demand broader focus.
Banyan currently has 130.82 million shares outstanding. Due to an uptick in price and volume last week, the company has a market cap of $10.5M, based on its recent $0.08 share price.
Correct that: after several hours of trade (post AurMac resource press release), Banyan is solidly higher, tagging $0.12 so far today (we first featured the company just over 3 months back when the shares were trading at $0.06).
Earlier this month, White Gold (WGO.V) emerged from its slumber and tabled a modest $6M FT private placement, a development we were quick to cover here at Highballer:
Then, on May 20, the company dropped the following headline:
The 2020 exploration program, budgeted at roughly $4.0M and backed by partners Agnico Eagle (AEM.TO) and Kinross (K.TO), is designed to further test existing targets and recent high grade discoveries at the company’s White Gold, Hen, and JP Ross properties, as well as to identify and advance other targets throughout its regional land package.
I suspect $4.0M is merely a kick off. If the company is successful in repeating the stellar 2019 results at, let’s say, TITAN… we could see a significantly expanded program.
2020 exploration plans include:
- Ryan’s Surprise target (along strike with the Golden Saddle Deposit): 1,500 meter diamond drill program to test for strike and down-dip extensions of mineralization encountered with 2019 diamond drilling;
- Titan target: 1,500 meter diamond drill program to test the extents of high-grade mineralization encountered in 2019 rotary air blast (RAB) drilling which included 72.81 g/t Au over 6.09 meters from 10.67 meters depth, within a 32 meter zone of mineralization;
- Approximately 25 RAB holes will be drilled to test high-priority targets on the White Gold, Hen and JP Ross properties;
- Mechanical trenching will be carried out on multiple targets on the JP Ross property to collect key structural data to aid in ongoing interpretations and future drill planning;
- Extensive regional exploration work on other properties will include geologic mapping, prospecting, soil sampling, GT probe sampling, ultra high-resolution drone imagery, ground magnetics, and VLF surveying on the Betty, Nolan, Bonanza and Tea properties.
Terry Brace, VP of Exploration:
“2020 is expected to be another exciting year for White Gold as we diamond drill test recent discoveries at the Ryan’s Surprise and Titan targets, as well as advance other high-priority targets across our expansive land package. Extensive review and analysis performed in the off-season has also provided new interpretations on several projects which we are excited to test. We will also continue to develop a better understanding of the geological and structural framework of our targets for follow up drill testing when ready.”
The company is inviting you to join David D’Onofrio (CEO), Shawn Ryan (Chief Technical Advisor), and Terry Brace (VP of Exploration) for a webinar this Thursday, May 28th.
Live webinar registration : https://webinars.6ix.com/6ix/White-Gold-Exploration-2020
Dial-in Number: 1 (312) 248-9348
Dial-in ID Number: 536652#
Dial-in Passcode Number: 8741#
The White Gold team will be available to answer your questions immediately following the presentation.
Pure Gold (PGM.V), another company on Highballer’s shortlist that has generated heaps of shareholder appreciation of late, was also featured in last week’s offering, having put on a really big show (Ed Sullivan voice).
The company dropped the following piece of news last week:
$15M Investment Backed By Eric Sprott To Accelerate Resource Growth At PureGold Red Lake Mine
Sprott is demonstrating serious stock (rock) picking savvy homing in on this compelling Red Lake story, on schedule for its first gold pour by years end.
This non-brokered private placement consisted of 9,868,421 charity flow-through shares at a price of $1.52 for gross proceeds of $15,000,000.
Darin Labrenz, Pure Gold CEO:
“Mr. Sprott is a cornerstone investor of PureGold and continues to be a strong supporter of our vision to becoming a high margin, long-life gold producer uniquely positioned in the Red Lake camp. We are fully funded and on-track to pour our first gold in Q4 2020 into a record high gold price environment for Canadian producers. This new investment in exploration enables us to concurrently ramp up our focus on aggressive resource growth without impacting our capital budget for final mine completion and first gold pour. We believe this combination of near-term cash flow through production and organic resource growth will create significant value for our shareholders in the near term.”
The underlined passage in the above quote is music to shareholders’ ears.
$15M will buy a lot of drilling and will push the company’s 7 kilometers of geologically prospective strike further along the curve.
Eric Sprott:
“PureGold has all the attributes I look for in a Company – location, grade, size and growth. PureGold’s mine in Red Lake has over 7km of strike with known high grade shoots that have only been defined down to 1,200 metres compared to 2,500 metres in the neighbouring Red Lake mine complex. The ultra-high grade hits in the 8 zone remind me a lot of the HG Zone that built Goldcorp, as well as SMC at Macassa and the Swan Zone at Fosterville. These are the types of discoveries that have the potential to be company makers and tend to lead to a much higher production profile than originally given credit.”
Pure Gold common shares just tagged multi-year highs… again.
Speaking of getting ‘tagged’, last week Cartier Resources (ECR.V) tagged high-grade gold at its Chimo Mine project in the Val-d’Or mining camp.
Cartier Cuts 20.8 g/t Au over 4.0 m at Chimo Mine 500 m below the New Zones 5B4-5M4-5NE
Every time I look at this subsurface map, it gets busier (that’s a good thing).
As per the May 21 press release:
The mineralized intersection of 20.8 g/t Au over 4.0 meters is included within 9.4 g/t Au over 11.0 meters, also included within 6.7 g/t Au over 16.0 meters, located 500 meters below the new Zones 5B4-5M4-5NE in the East Sector of the Chimo Mine Property.
The results of this press release, factored with those of the April 7th 2020 and February 18th 2020 press releases, increase the potential for expansion of the resource estimate to date for the new Zones 5B4-5M4-5NE (see map above).
Philippe Cloutier, Cartier CEO:
″ These new results indicate that the gold mineralisation is open in all directions below Zones 5B4-5M4-5NE which have been drilled to date from surface to a depth of 1,300 meters – growing the dimensions of the cluster of Zones 5B4-5M4-5NE is an important addition to the development potential of the project ″.
Final thought
The Highballer portfolio is firing on all cylinders.
The next significant piece of news to drop could come out of the Strategic Metals (SMD.V) camp, where we’re anxious to hear more about their plans for Mount Hinton in 2020.
END
—Greg Nolan
P.S. The U.S. ticker symbols for the stocks featured in this article are Banyan (BYAGF), White Gold (WHGOF), Pure Gold (LRTNF), Cartier (ECRFF), and Strategic Metals (SMDZF).
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