I decided today was as good a day as any to take stock (scuse the pun) and see how the Highballer portfolio has performed since I began covering our shortlist of ExploreCos earlier this year.
I launched Highballerstocks on January 15, 2020, to take advantage of what I believed was the beginning of an epic bull run in precious metals… and mining stocks.
The timing was very satisfactory.
The following is a performance review and a brief summary of our shortlist portfolio.
- 143.25 million shares outstanding
- $43.69M market cap based on its recent $0.305 close
- First featured on February 15, 2020 at $0.06
- A gain of 408%
Comments: Banyan controls two resource bearing properties in Canada’s Yukon.
On July 8th, the company initiated a phase 2 exploration program at its 9,230-hectare AurMac Property—a project located near Victoria Gold’s Eagle Project and Alexco’s Keno Hill Silver District.
This phase 2 campaign adds additional meters to an ongoing drilling program, plus geotechnical drilling, metallurgical test work, environmental baseline data collection, and community consultation.
AurMac assays could drop at any time.
The following video offers a good overview of the company’s AurMac resource base—> 900k ounces split between two deposits: Airstrip and Powerline.
- 192.81 million shares outstanding
- $58.81M market cap based on its recent $0.305 close
- First featured on January 15, 2020 at $0.15
- A gain of 103%
Comments: Cartier continues to de-risk its flagship Chimo Mine Property, located 50 kilometers SE of Val-d’Or Quebec, along the prolific Abitibi Greenstone Belt.
The total ounce count at Chimo currently stands at 1,182,990:
- 4,017,600 tonnes at an average grade of 4.53 g/t Au for a total of 585,190 ounces gold in the Indicated category;
- 4,877,900 tonnes at an average grade of 3.82 g/t Au for a total of 597,800 ounces gold in the Inferred category.
In a Highballer report published two weeks back—Cartier (ECR.V) looks to monetize flagship gold asset, sets stage for aggressive drilling campaign at Benoist project —I stated the following regarding the company’s current focus:
The company is blocking out additional ounces at Chimo as it continues to encounter significant high-grade mineralization at depth. Assays from this underground drilling campaign—10,000 meters focused on the 5B4-5M4-5NE and 5CE Gold Zones—will continue to flow as soon as their recently announced (upsized) PP closes.
This is a technically gifted crew. To augment the ounce-count and boost the value of the resource, they’re pulling out all the stops—internal engineering studies and industrial sorting tests are in progress to assess the potential for lower operating costs (OPEX) while increasing gold ounce recuperation.
According to an assay related headline tabled on May 28—Cartier Cuts 16.5 g/t Au over 4.5 m at Chimo Mine 500 m below the New Zones 5B4-5M4-5NE — the first internal engineering study was completed with positive conclusions.
This disciplined technical approach is tying a nice bow on the deposit, for those resource-hungry producers scouring the sector for potential acquisitions.
An updated resource estimate is now in the works and is expected to drop in Q4 of 2020.
As soon as Cartier closes a recently announced (upsized) flow-through PP, I suspect we’ll see the resumption of newsflow.
The following video is a very decent overview of Cartier’s flagship Chimo Mine Project, and the next project in line for a significant push along the development curve—Benoist.
- 46.17 million shares outstanding
- $37.39M market cap based on its recent $0.81 close
- First featured on January 15, 2020 at $0.50
- A gain of 60%
Comments: Coral isn’t producing much in the way of newsflow, but its key asset—an uncapped sliding scale (1% to 2.25%) NSR on over 2.7 million ounces at the Robertson Property located along the prolific Cortez Gold Trend of northern Nevada—just found a whole new gear.
With gold’s recent assault on US $2,000, that royalty now commands a weighty 2.25% (this slide was taken from a May, 2020 corp presentation, hence the lower gold input).
Robertson is a joint venture between Barrick Gold (61.5%) and Newmont-Goldcorp (38.5%).
This JV among mining behemoths is called Nevada Gold Mines, NGM for short.
Take a close look at the map above (note the scale). Pipeline, Cortez Hills, and Goldrush—all on-trend and in close proximity to Robertson—represent three of the largest Carlin-type gold deposits on the planet. These deposits, collectively known as the Cortes Mine Complex, make up NGM’s lowest-cost assets with over 26.8 million ounces of gold reserves & resources.
Robertson’s 2.7 million ounces are now considered part of the mineral resource base at the Cortes Mine Complex.
With gold testing all-time high territory, Coral is your classic buy and hold vehicle.
- 50.68 million shares outstanding
- $8.82M market cap based on its recent $0.17 close
- First featured on January 15, 2020 at $0.145
- A gain of 17%
Comments: Defense controls the Wicheeda Project, a high-grade, highly strategic REE resource in mining-friendly BC:
- An Indicated Mineral Resource of 4,890,000 tonnes averaging 3.02% LREO (Light Rare Earth Elements);
- An Inferred Mineral Resource of 12,100,000 tonnes averaging 2.52% LREE;
- All reported at a cut-off grade of 1.5% LREE (sum of cerium (Ce), lanthanum (La), neodymium (Nd), praseodymium (Pr), and samarium (Sm); in addition to niobium (Nb) percentages).
Last week—on August 4th—the company dropped the following headline:
Here, we’re getting an update regarding the (pilot-plant-stage) processing of a 30-tonne bulk sample currently underway at SGS Canada’s metallurgical test facility.
A total of 14 processing runs have been completed since the testwork began on June 11, 2020.
Highlights of this recent run:
- 16 tonnes bulk sample feed processed over 118 hours of operation to date;
- Approximately 750 kg of flotation concentrate produced (dry weight at ~15% moisture content);
- Process run concentrate grades ranging from 45.4% up to 56.7% (averaging 51.6%) LREO (light rare earth oxide expressed as the sum of light rare earth elements expressed as oxides Ce2O3+La2O3+Nd2O3+Pr2O3);
- Process recovery ranging from 53.8% up to 79.1% (averaging 70.2%) LREO;
Low average 6.2% mass yield to concentrate.
The following video shows the pilot plant in motion:
- 118.14 million shares outstanding
- $18.31M market cap based on its recent $0.155 close
- First featured on May 31, 2020 at $0.09
- A gain of 72%
Comments: Forum is my go-to copper ExploreCo.
Forums flagship asset is Janice Lake—38,250 hectares located in north-central Saskatchewan within the Wollaston Domain, “a northeasterly-trending belt of metamorphosed lower Proterozoic supracrustal rocks deposited upon Archean granitoid basement.”
The property boasts over 20 sediment-hosted copper showings that hold the potential for multiple layers of copper mineralization where Rio Tinto stands to earn an 80% interest in the project by spending $30M over six years.
Rio has spent $3.7 million at Janice Lake thus far and is accelerating work on the property projecting to spend $7 million on a multi-phase drilling campaign.
Rio’s phase one approach at Janice Lake—sparked by positive results from a first pass drilling program last summer—will focus on the regional potential of this 38,250-hectare property that encompasses the entire 52 kilometer Wollaston Copperbelt District.
Results from last summers drilling campaign include:
- 0.41% Cu and 4.2 g/t Ag over 57.1 meters (from 78.9 meters to 136 meters), including 0.95% Cu and 9.7 g/t Ag over 13 meters (from 89 meters to 102 meters);
- 0.57% Cu and 1.50 g/t Ag over 51.8 meters (from 116.2 meters to 168 meters), including 1.09% Cu and 1.39 g/t Ag over 9.1 meters (from 118.9 meters to 128 meters) and 1.32% Cu and 3.42 g/t Ag over 5.0 meters (139.0 meters to 144.0 meters).
Forum’s CEO, Rick Mazur:
“I look forward to this summer’s program with a regional focus on uncovering the full extent of copper and silver mineralization at Janice Lake. We have barely scratched the surface on exploring this sedimentary basin which stretches for over 50 kilometres. Rio Tinto’s focus will not only be on finding higher grade and thicker open pit strata-bound horizons, but also high grade structurally controlled mineralization.”
The company boasts several additional highly prospective assets in its project portfolio, but Janice Lake will be generating the lions share of newsflow over the balance of 2020, and into 2021.
I suspect an acceleration in newsflow will begin shortly.
I’ll be covering developments here closely. Stay tuned.
- 41.63 million shares outstanding
- $82.02M market cap based on its recent $1.97 close
- First featured on January 26, 2020 at $1.16
- A gain of 70%
Comments: HighGold’s 8,475 hectare Johnson Tract (JT) project in Southcentral Alaska is the subject of an aggressive drilling campaign, one that was recently upsized to 15,000 meters with a 3rd rig.
Darwin Green, HighGold President and CEO:
“With the recently announced $12 million bought deal financing HighGold has positioned itself to maximize the 2020 field season. The accelerated exploration program, which now includes three drill rigs and 15,000 meters of planned drilling, provides an opportunity to materially advance Johnson Tract this year. With an additional drill rig, we can test multiple target areas at the same time and rapidly follow-up on exploration success.”
The company has multiple high-priority targets in its crosshairs at JT:
JT Deposit Expansion
- The edges of the JT Deposit are open to expansion along strike, particularly the deeper portions of the deposit where the thickest and highest-grade mineralization has been intersected. Plans include step-out drilling northeast of drill hole JT19-090 that intersected 75.1m grading 10.0 g/t Au, 9.4% Zn, and 0.6% Cu.
- This represents the interpreted fault-displaced continuation of the main Johnson Tract resource and mineralized zone, located approximately 500 to 800 meters to northeast of the JT Deposit. Significantly, limited wide-spaced historic drilling has documented the same distinct alteration and metal signature that is associated with mineralization at the main JT deposit.
- A mappable trend and footprint of hydrothermal alteration extends over 1 km north from the JT Deposit, with no previous drilling. A new exploration model developed by the HighGold technical team suggests a first order, north-south structural control to mineralization with potential for multiple mineralized zones along this trend.
- Follow-up drilling is planned on a new discovery made during the 2019 confirmation and resource definition drill program. To date, only one drill hole has tested this distinct zone of mineralization located in the footwall to the JT Deposit, which intersected 20.7m grading 32 g/t Ag, 2.4% Cu, and 4.9% Zn in hole JT19-089.
- A zone of previously undrilled alteration and mineralization that lies to the immediate southwest of the JT Deposit.
The project already boasts a high-grade polymetallic resource in its subsurface layers: 2.14 Mt grading 10.93 g/t AuEq for 750,000 ounces in the Indicated category, and an additional 0.58 Mt grading 7.16 g/t AuEq for 134,000 ounces in the Inferred category.
For those who know their ore deposits, Sandstorm’s (SSL.T) Hod Maden deposit—9.1 million tonnes at an average grade of 8.9 g/t gold and 1.4% copper—is the analog here.
Adding validity to the geological merit of JT, the company recently closed an upsized bought deal worth $13.8M:
CEO Green again:
“With the closing of the financing, HighGold has $23 million in working capital, placing us in a strong position to materially advance our flagship Johnson Tract Gold Project in Alaska. We are very pleased to welcome several new, large institutional shareholders to HighGold’s registry. We are also grateful for the continued support of several existing major shareholders that participated in the financing. HighGold now looks forward to putting these funds to work.”
- 37.08 million shares outstanding
- $18.54M market cap based on its recent $0.50 close
- First featured last week, on August 4, 2020 at $0.25
- A gain of 100%
Comments: Minnova is a brand new addition to the Highballer portfolio.
I featured the company last week in a piece titled A new addition to the Highballer shortlist – Minnova Corp (MCI.V) – also Forum (FMC.V), Strategic (SMD.V), and PureGold (PGM.V)
Minnova’s flagship asset is its past-producing PL Gold Mine in the prolific Flin Flon – Snow Lake Greenstone Belt of Central Manitoba.
The current global resource at the PL project runs > 700k ounces of high-grade material.
The PL project is basically shovel ready.
There’s a 1,000 tpd permitted mill on the property. The replacement cost of said mill is > $60M.
The project is fully permitted—the timeline to production is short should the company decide to raise the necessary funds and begin breaking ground.
This is a modest production scenario—roughly 45k ounces per annum. Management envisions reopening the underground mine as well as carving out several small open pits.
It’s a modest mine plan, but the economics are robust.
A Feasibility Study (FS) tabled back in 2017, using a US $1,250 gold price, demonstrates the following values:
- An after-tax NPV at a 5% discount rate of Cdn $36.7 million;
- An after-tax IRR of 53%;
- A LOM OPEX = Cdn $162/tonne–US$750 /oz;
- Total estimated CAPEX = Cdn $35M;
- A swift payback period of ~1.5 years.
If we factor in a more realistic US $1,875 gold input, we get:
- An after-tax NPV at a 5% discount rate of Cdn $185.62M
- An after-tax IRR of 184%
If we factor in US $2,000 gold…
- An after-tax NPV at a 5% discount rate of Cdn $215.38M
- An after-tax IRR of 209%
All of a sudden it’s not looking so modest.
Refer to the highlighted article for a deeper delve into this undervalued, near-term production scenario.
Regarding the projects exploration upside, the company delivered the following update on July 30th:
“The drill program calls for approximately 2,000 meters of drilling focused outside of the current PL mineral resource and reserve to demonstrate the exploration and resource expansion potential on the permitted mining lease. Following the conclusion of the drill program work will shift to property wide surface exploration and prospecting to trace the strike extensions of the PL deposit trend, the PL North Extension Trend and an emerging new trend identified in current drilling hosted within the footwall Tonalite.”
- 384.94 million shares outstanding
- $769.87M market cap based on its recent $2.00 close
- First featured on April 5, 2020 at $0.64
- A gain of 212%
Comments: PureGold currently sports a market cap well north of $700M, and for good reason.
We picked up coverage of PureGold at an opportune time—a period when gold was still consolidating its gains, and the market had yet to consider the company’s near-term production potential.
The leverage here to a strongly trending gold price is excellent:
On June 24th, the company announced the following developments as its Red Lake mine:
- Procurement of major equipment is now 94% complete;
- Total of 1,285 metres of underground mine development completed. Advance rate 60% better than mine plan (editors note: wow);
- Initial access development to longhole stopes commenced;
- Installed alimak in existing shaft to support dewatering and shaft rehabilitation;
- Process plant prepared for installation of new equipment, with removal of legacy piping, pumps, motors, ball mill, gold room and pre-leach thickener;
- Steel and concrete work modifications inside process plant for new ball mill, gravity circuit and construction of hydraulic backfill plant commenced;
- Installed and occupied new buildings including administration, warehouse, and mine dry;
- Recruited key operational team members including safety, mining, milling, and technical services, with bulk of operational management team now in place;
- More than 145,000 hours without a lost time incident.
That was 1.5 months ago. We should see another update regarding construction activities soon.
The most recent news out of the company dropped on July 28th:
“Drilling has extended gold mineralization out from current design stopes, has discovered new gold zones that will be integrated into mine planning, and has confirmed stopes scheduled for near term production.”
Highlights from this batch include:
12.8 g/t gold over 10.0 metres from drill hole PGU-0136; including
20.1 g/t gold over 5.0 metres;
9.3 g/t gold over 2.4 metres from drill hole PGU-0123; including
16.2 g/t gold over 1.1 metres;
10.6 g/t gold over 2.0 metres from drill hole PGU-0124.
These results, along with previously announced assays, demonstrate the district-scale potential PurGold holds in its subsurface layers. Note the depth potential via the map below.
- 171.39 million shares outstanding
- $491.89M market cap based on its recent $2.87 close
- First featured on February 2, 2020 at $1.11
- A gain of 158%
Comments: Skeena recently acquired 100% control of Eskay Creek, an open-pittable resource of some four million ounces grading 4.4 g/t AuEq.
Last week, on August 4th, Skeena sealed the deal with Barrick Gold (ABX.T) via the following headline
Walter Coles Jr. Skeena’s CEO:
“We were encouraged by the positive market reaction to the announcement of the binding term sheet in respect to the Eskay Creek transaction with Barrick and are delighted to now announce the signing of the Definitive Agreement. On closing, Skeena will gain 100% ownership and operatorship of Eskay Creek, which we hope to revitalize as an open-pit gold-silver mine. Skeena is honoured to have Barrick as an important shareholder in the Company going forward.”
After announcing the commencement of a PFS to follow-up on a robust PEA, the company embarked on an aggressive 24,000-meter phase one drilling campaign designed to upgrade Inferred ounces to the higher confidence Indicated category.
This program is also aimed at drilling off highly prospective areas in the near-mine environment to expand the current resource and add to the ounce count (the company is permitting some 137,000 meters of exploratory drilling to test both brownfield and greenfield targets).
Indicative of the type of mineralization Skeena is encountering at Eskay Creek, an early May news release delivered the following (infill) values:
- 32.21 g/t Au, 121 g/t Ag (33.82 g/t AuEq) over 22.50 meters (21B Zone) including 753.00 g/t Au, 445 g/t Ag (758.93 g/t AuEq) over 0.83 meters;
- 5.90 g/t Au, 14 g/t Ag (6.09 g/t AuEq) over 24.55 meters (21B Zone) including 25.60 g/t Au, 56 g/t Ag (26.35 g/t AuEq) over 1.50 meters.
Expect strong drilling-related newsflow for the balance of 2020, and into 2021.
- 96.81 million shares outstanding
- $66.8M market cap based on its recent $0.69 close
- First featured on April 14, 2020 at $0.345
- A gain of 100%
Comments: We shortlisted this Yukon prospect generator back in mid-April, primarily for the high-grade potential of its wholly-owned Mount Hinton project.
On July 27th, the company announced the commencement of drilling at Mount Hinton.
One of the two drills on the property is currently situated in the Granite North Zone, where a rock sample collected from talus in 2019 returned bonanza-grade assays of 2,340 g/t gold and 597 g/t silver, and a recent chip sample across bedrock exposed in a hand trench yielded 26.9 g/t gold and 49 g/t silver across 1.22 m. The Granite North Zone is a complex feature comprising multiple, sub-parallel bands of altered and veined quartzite. The initial drill holes will form a section line across this more than 300 m wide zone.
The other drill is located in the Northern Structural Corridor, an up to 750 m wide zone that comprises more than 50 veins and vein segments, which have been traced in outcrop and talus over a combined strike length of nearly 4,000 m. Historical sampling in this zone focussed on sulphide-rich vein exposures, and little sampling was done across weakly mineralized veins or adjacent wall rock. Planned holes in this area are each expected to cross three or more veins, including the 19 vein where historical samples collected along 24 m of exposed strike reportedly had a weighted average of 6.51 g/t gold and 68.57 g/t silver over average width of 1.7 m, the 21 vein where samples taken over a 22 m long exposure yielded a weighted average of 42.5 g/t gold and 319 g/t silver across an average 1.05 m width, and the 24 vein where samples collected over a 24 m length had a weighted average of 17.5 g/t gold and 1546 g/t silver across an average 0.49 m width.
- 126.26 million shares outstanding
- $151.52M market cap based on its recent $1.20 close
- First featured on February 9, 2020 at $0.85
- A gain of 41%
Comments: White Gold (WGO.V) holds a dominant land position in the White Gold District of Canada’s Yukon.
The Golden Saddle and Arc deposits hold the bulk of the company’s resources.
- 1,039,600 gold ounces within 14,330,000 tonnes at 2.26 g/t Au in the Indicated category;
- 508,700 gold ounces within 10,696,000 tonnes at 1.48 g/t Au in the Inferred category.
Located directly across the river from Arc and SAddle, the VG Zone holds an Inferred resource of 230,000 gold ounces within 4.4 million tonnes at 1.65 g/t Au.
Of the multiple discoveries made in recent months, Titan and Vertigo stand out.
On June 29th, the company mobilized a drill rig to Titan.
“The first phase of the drill program consists of RC and RAB drilling to better determine the width and grade of the gold mineralized zone and to test a combination of magnetic highs similar to the one which hosts the gold at the Titan, and to also test soil geochemistry anomalies on the NE trend along the southern edge of the magnetic low feature.”
“The RC and RAB drilling will be followed up in August with a diamond drilling program at Titan, which will primarily focus on testing the NNW trend which extends from the encouraging intercept in hole HENTTN19RAB-002, as well as any new targets generated from the current RAB drilling.”
More recently, on Aug 6th, the company mobilized a rig to Ryan’s Surprise.
“The close proximity of Ryan’s to the Company’s existing mineral resources at Golden Saddle and Arc makes it a strategic target for these projects. The Golden Saddle and Arc deposits have a mineral resource of 1,139,900 ounces Indicated at 2.28 g/t gold and 402,100 ounces Inferred at 1.39 g/t gold and the VG deposit hosts a historic Inferred gold resource of 230,000 ounces at 1.65 g/t gold.”
That’s going to be it for this one. The summer-of-2020 promises to be a busy one.
Full disclosure: Of the companies featured above, Cartier Resources, Forum Energy Metals, and Defense Metals are Highballer marketing clients. The author owns shares in Cartier, Defense, Forum, Minnova, HighGold, and Strategic.Disclaimer - Legal Notice
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