Treasury Metals: Acquisition of Goldlund and C$11.5M Upsized Financing Couldn’t Be Timed Better with Gold Reaching All Time Highs

Source: The Critical Investor for Streetwise Reports   08/03/2020

The Critical Investor takes an in-depth look at Treasury Metals and its new acquisition in Ontario.

Treasury Metals Inc. (TML:TSX: TSRMF:OTCBB) recently surprised the markets with the raising of C$11.5 million in an oversubscribed financing, after announcing the pretty interesting all-equity acquisition, worth C$44 million in shares at the time of the news release, of the neighboring Goldlund open pit project from First Mining Gold, adding 1.6 Moz Au of resources to the 1.46 Moz AuEq of Treasury's flagship Goliath Gold open pit/underground project. By creating a 3 Moz gold developer in Ontario, one of the hottest gold mining districts in North America, Treasury attempts to come onto the radar of larger industry players. The beefed up treasury will allow the company to advance both assets at increased speed, hereby ideally utilizing the rising spot gold price, which reached all time highs on July 31 at US$1994/oz:

https://criticalinvestor.eu/sites/default/files/uploads/99.jpg

The sentiment drivers for gold couldn't have been better, as the amount of central bank stimulus is unprecedented, the U.S. dollar weakens further, interest rates are close to zero and real interest rates are negative for the foreseeable future, and to top it all off the second wave of COVID-19 combined with intensifying U.S.-China tensions increase uncertainty. Analysts expect to see gold surpassing the important US$2,000/oz level very soon.

Although Goliath Gold is more advanced and will be earlier into production if all goes as planned, management is now aiming at following the Atlantic Gold model, which consisted of a series of neighboring gold projects being permitted and constructed in a staged way, involving one central mill and processing plant. Synergies are obvious here, and therefore I am very much looking forward to the first combined economic study of both Goliath and Goldlund, which can be expected in about six months according to Treasury management. Notwithstanding this, I'll try to estimate combined economic potential myself in this article, and discuss other aspects of this deal.

All presented tables are my own material, unless stated otherwise.
All pictures are company material, unless stated otherwise.
All currencies are in US Dollars, unless stated otherwise.

After years of advancing at a modest pace, Treasury Metals finally seems to have found the gearbox, coming up with one interesting news release after the other, varying from buying a significant gold asset like Goldlund to raising much larger amounts of cash than usual the last few years. Recently, the company closed a C$11.52 million bought deal private placement of 32 million common shares at a price of $0.36, plus a half warrant at a price of C$0.60 for a period of 24 months. There is an acceleration clause as well, if the closing price is equal to or greater than C$1.00 for a period of 20 consecutive trading days, the company may elect to accelerate the expiry date of the warrants at least 30 calendar days after notification of warrant holders. The placement was led by Haywood, and included PI Financial, Sprott Capital Partners and Canaccord.

Haywood, PI and Canaccord are the usual suspects in financings, but seeing Sprott Capital Partners subscribing as well could be seen as a welcome indication of quality, in my view, as they have some of the best analysts working for them and have buy side standards on risk/rewards. It is also good to see Treasury being less dependent on their loyal European investors, but also able to tap substantially into the Canadian capital market.

According to CEO Greg Ferron, the proceeds from this financing will fund the completion of a combined Goliath-Goldlund economic study expected within 2020, advance key engineering and environmental baseline data on Goldlund, and complete 25,000 meters of infill and expansion drilling program on the combined projects.

It will be clear that the second half of 2020 will be as remarkable and active as the first half for Treasury, after going through COVID-19 and acquiring a transformational gold asset. Although we have already seen our fair share of gold focused deals this year, like Shandong acquiring TMAC, SSR Mining merging with Alacer Gold, Silvercorp Metals bidding successfully for Guyana Goldfields, Shandong bidding for Cardinal Resources, and numerous smaller deals, Treasury did their own interesting gold asset deal by buying the nearby Goldlund project from First Mining Gold. This project hosts a large near-surface gold resource, and sports a NI43-101 resource, estimated to contain 809,200 ounces of gold in the Indicated category, plus 876,954 ounces of gold in the Inferred category within a vast 280 km2 property package located directly to the northeast of Goliath.

Afbeelding met tekst, kaart

Automatisch gegenereerde beschrijving

As can be seen, both claim packages of Goliath and Goldlund are almost connected. In the conference call regarding the transaction, CEO Greg Ferron of Treasury responded to a question involving this, that he very recently acquired the connecting claim package, before the Goldlund deal was announced. It is not very important in this case to have a continuous claim package, as both deposits are distanced about 23 km from each other as the crow flies, so not right on strike, but for the future it could come in handy not to have different owners sitting in between the two claim sets in the hypothetical case there might be exploration success near both borders of both sets.

The deal terms are as follows, per the news release:

  • 130 million common shares of Treasury Metals

  • 35 million warrants of Treasury with each warrant entitling the holder thereof to purchase one common share at an exercise price of $0.50 for a period of 36 months following the closing of the transaction

  • a 1.5% net smelter returns royalty covering all of the Goldlund claims with the option for Treasury to buy back 0.5% of the Goldlund Royalty for $5.0 million

  • a milestone cash payment of $5.0 million, with 50% payable upon receipt of a final and binding mining lease under the Mining Act (Ontario) to extract ore from an open pit mine at Goldlund, and the remaining 50% payable upon the extraction of 300,000 tonnes of ore from a mine at Goldlund.

What to make of these deal terms? At a current number of outstanding shares of 169.73 million, the addition of 130 million new shares and 35M million warrants would effectively almost double the share count when all new warrants would have been exercised. Under other circumstances when existing shareholders get diluted almost 50% in a company it is not considered a positive, but in this case it could very well be a transformative deal, in my view, justifying the dilution. Not only 1.6 Moz Au is added to the resource base of Treasury, resulting in 3 Moz Au, which makes things much more interesting for mid-tier producers, or with the assumed exploration potential at Goldlund even 5 Moz Au targets come in sight, alerting major producers in that case.

In my view, the big benefit of adding Goldlund is its open pit potential to Goliath, a combined open pit/underground project that has already received an environmental permit, which is hard to get in Ontario. An existing environmentally permitted, and later on eventually a fully permitted, Goliath project, could have a strong positive influence on the nearby Goldlund permitting process. We must keep in mind that Goldlund will have a larger footprint as an entirely open pit project and as such it could take a while before an environmental permit is granted, but since Goliath also has an open pit component, it sure doesn't seem unrealistic. I asked management what they think of the differences on permitting Goldlund compared to Goliath, and a realistic timeline for it, and this is what they said:

"A key commitment we will continue to make will be working closely with all regulatory agencies and local partners to educate them on the potential impact and the positive economic aspects of a larger and more robust operation. The Goldlund project permitting process will be unique compared with Goliath, which will host the mill and tailings facility. Ideally, we would propose to have the Goldlund open pit in production with 2-3 years following production at Goliath."

Back to the deal terms then. 130 million new shares are worth C$44 million at the time of announcing the deal, the warrants according to Black Scholes calculations had a valuation of about 6c each, adding about C$2.1 million, bringing equity to C$46.1 million. The milestone payment has to be done 2-4 years from now, being able to achieving those milestones, and the royalty is valued at C$15 million but its current value isn't close yet as economics of Goldlund have to be determined yet. All in all the transaction seems to hover around C$50 million in value for Goldlund, generating an EV/oz of C$31/oz Au. Assuming a decent profitable deposit (at least an after tax IRR of 20% at a gold price of US$1250/oz), with no economic study, this is a fair price in my view, considering peers who all have studies completed:

  

As can be seen in the IRR column, companies like GoldX and Falco have projects with low profitability, but are also combined with high capex or non-favorable jurisdictions, generating their relatively low EV/oz value. This doesn't mean that these peers should be avoided at all costs, as both have strong financial backings, meaning game changing M&A could be around the corner at any time. But this isn't something I consider a solid investment fundamental, and the market seems to agree for now. However, always keep in mind that every company has its own very specific set of circumstances, resulting in various metrics, I just picked out a few well-known ones in my view.

The goal for Treasury is of course to integrate Goldlund to the same level as Goliath for economics, and by doing so increase the value of the Goldlund ounces accordingly. I'll get back to valuation later on in this article, first let's have a look into further transaction details.

  • Treasury board of directors (the "Board of Directors") shall be reconstituted to consist of seven individuals, with First Mining entitled to nominate three directors, two of which shall be "independent" within the meaning of National Instrument 52-110 Audit Committees. Treasury will be entitled to appoint the chair of the Board of Directors. Additionally, (i) for so long as First Mining holds greater than 10% of the issued and outstanding Common Shares, First Mining shall have the right to nominate two nominees for election as directors of Treasury; and (ii) for so long as First Mining holds greater than 5% but less than 10% of the issued and outstanding Common Shares, First Mining shall have the right to nominate one nominee for election as a director of Treasury.

This is in line with the equity payments for Goldlund vs the outstanding number of shares of Treasury before closing the transaction.

  • Pursuant to the Investor Rights Agreement, First Mining shall use commercially reasonable efforts to distribute a portion of the Share Consideration and all of the Warrant Consideration to First Mining shareholders on a pro-rata basis following the closing of the Transaction (the "Distribution"). The Distribution shall occur no earlier than six months but no later than one year after completion of the Transaction, with First Mining retaining ownership of Common Shares equal to no greater than 19.9% of the then issued and outstanding Common Shares on a partially diluted basis, subject to regulatory and tax advice. Following the Distribution of the Warrant Consideration, Treasury will use commercially reasonable efforts to list the Warrants for trading on the Toronto Stock Exchange (the "TSX") and the OTCQX in the US. First Mining has also agreed to certain standstill and resale provisions with respect to the Common Shares it controls. The Investor Rights Agreement shall terminate in the event that First Mining holds less than 5% of the issued and outstanding Common Shares.

As the amount of shares received by First Mining is very substantial (43% excluding warrants, 49% including warrants), this distribution is an important term of the deal. When listening to the press conference on June 9, 2020, First Mining CEO Dan Wilton indicated that the warrants will all be distributed to First Mining shareholders, and about 70 million of the common shares will be distributed as well. This will proceed at least 6 months and not later than 12 months after closing the deal. There is no plan of arrangement. First Mining will choose a record date for the distribution at some point in the next 12 months and dividend these shares and warrants to their shareholders. Potentially, they will distribute all but likely maintain up to 19.99%. By doing it this way, Treasury is hypothetically at risk of First Mining shareholders selling out on the Treasury shares, but I view these as better options on the gold price compared to the First Mining shares, so my take is they will hold on as long as gold continues to trade strong and Treasury keeps performing well.

  • Upon closing of the Transaction, it is anticipated that Treasury will consolidate its Common Shares on a 3 for 1 basis, subject to the receipt of all necessary approvals.

Standing at 300 million shares already and still at PEA/PFS stage and a lot of work to do before capex funding could be arranged, this is probably the best thing to do. Usually I am not an advocate of roll-backs as it often dilutes existing shareholders and causes sell-offs by those disappointed shareholders, but in a positive environment like the gold bull market we seem to have on our hands now, it could certainly work out positively as potential new shareholders like lower share counts, and the optics of new raises in the future look better. It is even possible with a higher share price to increase the possibility to be included in the Van Eck GDXJ ETF for junior gold miners. This in turn usually increases liquidity in the relevant stock significantly, and makes relevant stocks eligible for inclusion in other funds. CEO Ferron told me when suggested, that they will indeed also consider a U.S. listing, and could qualify for GDXJ at some stage, which he agrees would enhance liquidity and better access to institutional investors globally. They will target marketing to North America investors upon completion of the transaction.

As several countries across the globe are already increasing COVID-19 restrictions again, fearing a second wave, I asked CEO Ferron what the status for Ontario and their work programs is. Ferron stated that they can't do anything else but follow guidance, they are ready to scale up/down activities as soon as the situation allows/demands it. The company will announce a large exploration program with three drilling rigs in the next few weeks and the teams are in place to manage the exploration program at both Goliath and Goldlund. At this point, the company has sufficient funds, and currently has about C$13 million in the treasury, and a convertible debt of C$4.5 million, carrying an 8% interest. As a reminder, the debenture is held by two of the largest equity holders in the company, Extract Capital and DSC, which are supportive.

The share price of Treasury Metals looks like this:

Afbeelding met kaart, tekst

Automatisch gegenereerde beschrijving
Share price; 1 year time frame

The big COVID-19 sell-off around March 20, 2020, left scars on the chart for Treasury Metals as it did for almost any actively traded company worldwide. However it completely recovered at impressive volumes, as did almost all other companies, on the back of massive, unprecedented global central bank stimulus programs to the tune of trillions, in turn triggering gold reaching US$1,945/oz recently. The underlying deterioration of economic fundamentals seems to be completely neutralized by all stimulus, which is remarkable, as if COVID-19 was an isolated incident, and a well-forecasted recession wasn't in the cards whatsoever. It seems the markets feel invincible, having the unlimited support of the central banks now. Job reports being not as bad as forecasted cause further legs up, tech giants like Amazon, Microsoft and even Tesla break all time records time after time, even oil recovers. Strange times, even the Q2 financials can't derail the optimism. Notwithstanding this, with no strong economic fundamentals to back everything up, some caution is necessary, in my view.

For now the recovery and especially the large volumes accompanying this for Treasury show strong support, indicating Treasury as a serious gold developer in a gold bull market.

Let's have a look at the additional value of the Goldlund asset. As it is located nearby Goliath (25km distance), the synergies are obvious, as the planned processing facility of Goliath can be expanded for the future and much larger open pit ore from Goldlund. When looking at the basic numbers, the current Goliath resource stands at 1.46 Moz AuEq, consisting of 80 koz Au Measured, 1.2 Moz Au Indicated, 222 koz Au Inferred, and a bit of silver with an average grade of 1.40 g/t Au M&I for the open pit component, and 5.39 g/t Au for the underground component. Here is the resource table of Goliath:

As can be seen in the resource statement, the open pit (= in pit area) component contains 569 koz Au @ 1.40g/t, which can be combined with Goldlund. The newly acquired Goldlund resource stands at 1.69 Moz Au, consisting of 810 koz Au Indicated @ 1.96 g/t, and 880 koz Au Inferred @ 1.49 g/t, all of which is open pittable. Here is the comparison between the Goldlund resource estimate from 2017 and 2019, as per the NI43-101 report:

It is interesting to see the ounces being brought down by a solid drill program by First Mining Gold. However, when they bought the asset they had high hopes of increasing resources. Let's hope under Treasury's ownership and guidance more gold will be found. Let's have a quick look at Goldlund in order to get an impression. It is a very long deposit, consisting of several lenses:

Afbeelding met tekst, kaart

Automatisch gegenereerde beschrijving

Please take notice of zone 1, 4 and 8 being located closely to one another. A typical section looks like this:

Afbeelding met tekst, kaart

Automatisch gegenereerde beschrijving

As can be seen, the lenses are relatively narrow, but start at surface, which justifies the open pit concept. Also the sections show that the mineralization runs quite deep, 400 meters or deeper, and the intercepts aren't that bad, like the 2m @9,66 g/t in the section. These are easily economic intercepts for an underground operation, of course continuity over long strike lengths is necessary in that case, and might be a possibility as the entire deposit is open at depth, but this will take much more drilling for starters. But who knows, with a gold price hovering above US$1900, mineralization like this becomes economic very quickly, especially if an open pit mine on top of it is already operational.

The combined open pittable resource goes to 2.26 Moz Au, the total resource more than doubles, going from 1.4 Moz to 3.1 Moz Au.

As not all Goldlund resource ounces can be included in a combined PEA mine plan, as reserves usually leave out 10–30% of resources, Indicated ounces provide a lot more certainty, and the Inferred ounces are standing at a much lower average grade, I would like to limit the number of included Inferred ounces to 190 koz Au, generating a nice round 1 Moz Au. It is usually common practice to pay back as much capex as possible in the first years of an operation, so in order to do so companies often optimize mine plans for this purpose by high grading the production schedule, providing the most ounces this way. I am no mining engineer, but I can imagine that in this case Zone 1, 4 and 8 (505 koz Au) could be mined first, as we have already seen their location close to each other, and for their higher grade ounces:

Afbeelding met schermafbeelding

Automatisch gegenereerde beschrijving

I noticed that the strip ratio at 4.7:1 is very decent, mining costs are estimated pretty low, and recoveries are very decent as well. This will show in the upcoming peer comparison.

As the company shares in their presentation, Goliath and Goldlund have similar metallurgical properties, which is a big plus when designing and engineering the Goldlund expansion considering expansion capex. Treasury also mentions a greater focus on open pit mining, resulting in operating cost reductions and further optimizations. The increased open pit component is kind of a double edged sword in my view. It is beneficial for costs, but it also complicates permitting as an open pit operation generates much more disturbance at surface, and therefore likely will create the need for staged development, assuming Goliath can be funded and constructed into production before Goldlund gets permitted. On the other hand it is a clear advantage that Goliath already received the environmental permit. All in all, as Goliath took 5 years to get this permit, I see Goldlund taking another 4–5 years from now to being fully permitted. For now, let's have a look at some peer projects in order to see what very globally can be expected for hypothetical combined economics.

I lined up a few projects that are based on open pit/underground combinations, and a few solely open pit based projects:

Afbeelding met tekst

Automatisch gegenereerde beschrijving

Sabina with Back River is a bit of an outlier in this comparison, as the location (Nunavut) is much more Nordic, and as such the capex/tpd ratio is much higher, meaning the mining operation and infrastructure needs relatively more capital when constructed. Notwithstanding this, it still could be useful to determine average mine life, gold recoveries and mining costs for example. I will try to estimate Goldlund economics first, and then blend these with the existing Goliath economics:

  • an important metric is the used head grade. Some deposits have a lower head grade compared to their resource, others have higher grades, as they were eligible for being high graded for production. Others have a higher head grade for the open pit component, and a lower head grade for the underground component (Treasury itself for example). Of course the geological makeup of the deposit must allow this, so the higher grade ounces can be mined efficiently. As indicated above, I do believe Zone 1, 4 and 8 can be mined first, although I have no clue about potential high grading. In order to err on the safe side, I will use the same head grade for the Goldlund ounces, on average 1.85g/t Au.

  • I was surprised to often see open pit dilutions of over 20%, only Back River and Stibnite had 9% and 0% respectively. One could think that in an open pit everything being classified reserves gets mined anyway, but apparently not. Therefore I would like to use 25% dilution.

  • For recovery the average is 94%, nearby Goliath uses 95.5% and according to management metallurgical properties of Goldlund are comparable, so I assume 94% here.

  • As mid-tiers like to see average production figures of at least over 100koz Au per annum, I would like to spread additional Goldlund production as much as possible over the entire life of mine of Goliath, which is 13 years. Dilution and recovery generate 705 koz Au of Goldlund ounces, adding on average 54 koz per annum (pa), lifting the average production of just Goliath from 88 koz pa to a combined 142 koz pa.

  • Most of the expansion capital (sustaining capex) for Goldlund will be funded out of Goliath cash flow. Most of the synergy will be about the use of the processing facility at Goliath, as mine construction and infrastructure of Goldlund has to be done anyway. Most of the peers with underground/open pit production seem to have more expensive capex/tpd ratios compared to Treasury, and most of them have lower processing facility costs relative to total initial capex, as Treasury has low infrastructure costs:

Afbeelding met schermafbeelding

Automatisch gegenereerde beschrijving

And a breakdown of the Processing Plant, as things like Infra and Indirects were included:

Afbeelding met schermafbeelding

Automatisch gegenereerde beschrijving

Contingency is part of the Indirects. I found the different tables and breakdowns in the Treasury PEA confusing, usually a single table is used to summarize a capex breakdown, comparing to, for example, the capex numbers of Valentine (Marathon Gold, PFS p. 356):

Afbeelding met schermafbeelding

Automatisch gegenereerde beschrijving

In order to combine Goldlund, the processing plant and the tailings facility can be used, but will have to be expanded. As Goldlund will be a larger open pit operation compared to Goliath, I expect things like pre-strip, mining capex and construction indirects, maybe some infrastructure, to be more expensive. As gold production will increase by an estimated 60%, and the average estimated diluted head grade of Goldlund is about 17% higher, I would like to increase the throughput with a bit of margin by 60%, going from 2,500 tpd to 4,000 tpd. Such expansions can be done in a second stage after Goliath commences commercial production.

I estimate such a processing expansion cost to come in at C$50 million, although I expect Goliath to be designed, engineered and constructed with lots of future Goldlund expansions in mind, as such probably saving on this number. Mine development, some additional mine fleet, expanded tailings facilities, etc., could be roughly the same figure compared to Goliath (C$40 million), resulting in C$90 million, as I see Goldlund production coming in close to that of the Goliath open pit figures of the first years of production (see PEA p. 276):

Afbeelding met schermafbeelding

Automatisch gegenereerde beschrijving

Adding contingency, some infrastructure, EPCM and other extras I would like to estimate the expansion capex for Goldlund at C$115 million. Timing of Goldlund commencing production isn't easy. Management expects Goldlund to be in operation 2–3 years after Goliath commences commercial production, but they also hope at a faster start of Goliath. Key ingredient for me is an anticipated 4–5 year permitting timeline for Goldlund. Besides this, I would like to rely on the most conservative scenario regarding funding capex, which is funding most capex by third parties instead of internal cash flow. That way Treasury maybe doesn't have the highest IRR that it would have with staged development, but reaches maximum production and cash flow as soon as possible, which in my view creates the most leverage for the share price, especially when gold continues to trade strongly. So it is a time versus return dilemma for management in my opinion, and likely the banks and other lenders will show their preferences in due time. Some capex can be funded internally of course. For now, the resulting EBIT in the 2017 PEA is C$28 million for year 1, so I estimate Treasury to fund an estimated C$25 million of the Goldlund capex internally, resulting in initial capex of C$153M + C$90M is C$243M (=US$183M).

  • The open pit mining costs vary from C$2/t to C$3.45/t (I discard Clearwater as their C$9.24 figure is a clear outlier), I assume C$3.50/t.

  • Processing costs are on average C$16/t (I discard Back River as the C$37.16/t will probably be caused by the extreme conditions up north), I assume C$18/t.

  • AISC ranges between US$566/oz (Treasury) and US$739/oz (Marathon Gold), although Marathon is clearly the highest, as the second highest is Back River, which has US$620/oz despite their very high grade open pit grades, but as mentioned it's their Nordic location that makes things relatively expensive to operate. I assume US$620/oz.

  • As far as I know there is no reclamation trust connected to Goldlund, like the C$20 million obligation at Goliath.

  • The discount rate for the discounted cash flow model is 8%

This all results in the following metrics:

https://criticalinvestor.eu/sites/default/files/uploads/112_0.jpg

And this in turn results in the following hypothetical, simplified DCF model, using a US$1600/oz gold price:

https://criticalinvestor.eu/sites/default/files/uploads/113_0.jpg

Please note the resulting NPVs are in U.S. Dollars. The corresponding after-tax IRR looks like this:

https://criticalinvestor.eu/sites/default/files/uploads/114_0.jpg

For best comparisons, a sensitivity analysis regarding the gold price is necessary:

https://criticalinvestor.eu/sites/default/files/uploads/115_0.jpg

As can be seen at for example the 2017 PEA base case gold price of US$1250/oz, the combined after-tax NPV5 increases a lot and almost doubles. The after-tax IRR goes down from 25% to 24.1% at this gold price, so the project is slightly less robust but much larger, and as such and certainly at current gold prices should be much more interesting to mid-tier producers, who are scrambling to buy sizeable assets worldwide, let alone in prime jurisdictions like Ontario. At current gold prices of around US$1960/oz, the NPV5 stands at C$1354 million. For comparison, the current market cap of Treasury stands at C$90 million, and after the deal has closed (and trading at the same share price) at C$159 million, which is barely 12% of the after-tax NPV5. As a rule of thumb, single project companies trade at or close to NPV value when production commences, so any billion-plus valuation isn't in the cards anytime soon, but it sure indicates the potential of Treasury Metals.

Another benefit for Treasury or any suitor is the exploration upside of both Goliath and Goldlund. Both are open at depth, and although the mineralization at depth doesn't seem as spectacular as Red Lake or Madsen for example, at these gold prices there is a lot of margin for error.

In order to get a better feeling of where Treasury stands now compared to its peers, I updated the peer comparison, and used the hypothetical numbers of my 2020 PEA estimates:

And:

At first sight, Treasury doesn't seem particularly undervalued, although some market commentators think that solid, advanced gold projects should at least be valued at C$100/oz on an EV/oz metric basis these days. When hair-splitting over it, one could argue that once the Goliath PFS comes out within months, that part of the company should have a higher EV/oz valuation, and as such blending the Goliath metric with the Goldlund metric probably ending up higher. After the combined PEA comes out, economic potential of Goldlund is indicated as well, and if robust a further re-rating of ounces and thus value seems justified. However, it is also important to realize that Goliath/Goldlund is located in a prime jurisdiction, Goliath has an environmental permit secured, and the total capex is relatively limited so it has a very decent chance of funding capex by itself and reach full potential, and combined with the exploration potential as such also at least in my view a prime target for a mid-tier producer.

5. Conclusion

After a perfect storm seems to be aligning for gold, Treasury Metals seems to have done the Goldlund deal right on time. A combined PEA of both Goliath and Goldlund clearly has synergies, and almost doubles the hypothetical NPV5. The estimated IRR is just marginally lower, but at these gold prices the combined operation has a significant margin for error. Keep in mind that Treasury has options with funding Goldlund capex with internal cash flow, resulting in a much higher IRR, but a longer timeline to full production and full NPV. With the recently raised C$11.5 million, all the exploration potential as a wild card, and both the combined PEA and the Goliath PFS coming up this year with gold rising to all-time highs, the story for Treasury Metals looks better and better by the week.

I hope you will find this article interesting and useful, and will have further interest in my upcoming articles on mining. To never miss a thing, please subscribe to my free newsletter on my website www.criticalinvestor.eu, in order to get an email notice of my new articles soon after they are published.

The Critical Investor is a newsletter and comprehensive junior mining platform, providing analysis, blog and newsfeed and all sorts of information about junior mining. The editor is an avid and critical junior mining stock investor from The Netherlands, with an MSc background in construction/project management. Number cruncher at project economics, looking for high quality companies, mostly growth/turnaround/catalyst-driven to avoid too much dependence/influence of long-term commodity pricing/market sentiments, and often looking for long-term deep value. Getting burned in the past himself at junior mining investments by following overly positive sources that more often than not avoided to mention (hidden) risks or critical flaws, The Critical Investor learned his lesson well, and goes a few steps further ever since, providing a fresh, more in-depth, and critical vision on things, hence the name.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Critical Investor Disclaimer:
The author is not a registered investment advisor, and currently has a long position in this stock. Treasury Metals is a sponsoring company. All facts are to be checked by the reader. For more information go to www.treasurymetals.com and read the company's profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.

Streetwise Reports Disclosure:
1) The Critical Investor's disclosures are listed above.
2) The following companies mentioned in the article are sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Charts and graphics provided by the author.

( Companies Mentioned: TML:TSX: TSRMF:OTCBB, )

Junior Explorer Confirms High-Grade Copper-Silver at Ecuador Property

Source: Streetwise Reports   08/03/2020

The mineralization at Aurania Resources' flagship project is "resolving into specific targets."

Aurania Resources Ltd. (ARU:TSX.V; AUIAF:OTCQB) announced in a news release it confirmed high-grade copper-silver in the Tsenken B target area of its flagship Ecuadorian Lost Cities–Cutucu project.

"We are very encouraged to see the copper-silver in the Tsenken area resolving into specific targets that we aim to drill test as soon as possible," Chairman and CEO Dr. Keith Barron said in the release.

The explorer, headquartered in Toronto, reported that Tsenken B showed "sedimentary-hosted copper-silver mineralization in outcrop and boulders," the release noted. Field mapping and soil sampling will be done there next to define drill targets.

To date, Aurania has tested and reported results for the Tsenken A, Tsenken B, Tsenken N1, Tsenken N2, Tsenken N3, Tsenken N4 and the Tsenken magnetic center targets, spanning from the intensely mineralized fault breccia at Tsenken A to the area 6 kilometers north of it.

Generally, "the copper-silver is hosted by sedimentary layers that contain fossilized, carbonized plant fragments within an enclosing stack of red-colored sandstone or red beds," according to the release.

In the next few weeks, Aurania stated it will mobilize to the project site a lightweight rig, one with a maximum reach of 800 meters, for an upcoming drill program, in which Tsenken N2 and N3 will be tested first.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Aurania Resources. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

( Companies Mentioned: ARU:TSX.V; AUIAF:OTCQB, )

Precious Metals Explorer Provides First Results from Nevada Gold Project

Source: Streetwise Reports   08/03/2020

Newrange Gold reported first results from the drill program at its Pamlico Gold project in Mineral County, Nevada.

In a news release, Vancouver-based precious metals exploration and development company Newrange Gold Corp. (NRG:TSX.V; NRGOF:OTC) announced "the first results from the ongoing reverse circulation (RC) drilling program at the Pamlico Gold project in Nevada."

The firm noted that 25 holes totaling of 2,505 meters have been drilled to date and that the 14 holes reported herein cover around 450 meters of strike length along the central part of Pamlico Ridge. The company indicated that gold-silver mineralization consists of higher grade structures up to 9.51 g/t gold in the area between the Pamlico and Gold Bar mines.

The company's CEO Robert Archer commented, "We are making good progress in our understanding of the geological setting along Pamlico Ridge...These first results are helping to define the continuity of mineralized zones and areas of better grade. We have only just started to drill the Gold Bar and Good Hope Mines and anticipate drilling at least 3,000 meters in 25 additional holes that are already permitted in this initial part of the program."

"Importantly, we have also tested several shallow Induced Polarization (IP) targets and in every case have intersected disseminated pyrite or the oxidized remnants of sulphide mineralization. Once we have assay results from these, we will have a better idea of the gold-pyrite association, which will, in turn, assist in targeting the deeper IP anomalies," Archer added.

Newrange Gold reported that the permitting process is still ongoing for some sites and roads beyond the next 25 holes. The firm expects the entire drill program will include up to 10,000 meters of both RC and diamond drilling over the next several months.

The company advised it has begun monetizing its former non-core assets in Colombia and generated about $1 million from the first half of shares in GoldMining Inc. that it received from the sale of the Yarumalito property and sold in the open market. The firm added that the remaining shares will be delivered out of escrow when the Yarumalito license is transferred to GoldMining's Colombian subsidiary.

The firm further advised that some shareholders have been exercising their warrants and options to take advantage of the recently higher share price, which should generate another $800,000 in the next few months that could be used to finance ongoing drilling operations.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Stephen Hytha compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Newrange Gold and GoldMining Inc. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Newrange Gold and GoldMining, companies mentioned in this article.

( Companies Mentioned: NRG:TSX.V; NRGOF:OTC, )

Storm Clouds Are Gathering for a Major Market Downturn

Source: Clive Maund for Streetwise Reports   08/03/2020

Technical analyst Clive Maund charts warning signs of a Fed-driven stock market downturn.

There is a now widespread, universally held belief, especially among "dumb money" market participants, that the markets cannot drop because the Fed is going to keep creating money in ever greater quantities to throw at them, pumping them higher and higher.

This erroneous belief appears to be based on an assumption that the Fed cares about the economy or the welfare of the citizenry, when the reality is that the reason it exists is as a "wealth transfer engine" whose prime function is to serve as a mechanism for transferring the fruits of the labor of the population at large to the elite cadre at the top of the pyramid—and they even have a pyramid on their Federal Reserve notes.

They achieve this through "systemic inflation," with a fiat money system in place now for many years that enables them to print unlimited quantities of money, which they gift in the first instance to themselves and their crony associates and large, favored corporations, and then let the rest out into the economy, with the tab for all this being pushed onto the hapless citizenry in the form of inflation. This is why the dollar has devalued by about 97% in purchasing power since the Fed came into existence in 1913.

Now, with the fiat system approaching its nemesis, as debts and money creation go parabolic, the gloves are off and they don't even bother to make any pretense about it—they create trillions, which they hand straight to big. favored corporations and Wall St. banks. The implied challenge to the ordinary citizen is: "You don't like it? Well, what are you going to do about it?" They are not just above the law, they are the law, and they can and will do as they please.

Given that the Fed's primary objective is to transfer wealth from the masses to the elites, and given that after months of the stock market trending higher, Dumb Money has been piling into the market again as Smart Money exits. We can see [this] on the latest Smart/Dumb chart below. It would seem irresistibly attractive to them to pretty soon rip the rug out from under the market and send it plunging again, as they did in the spring, and then move in and pick up Dumb Money's holdings when they sell in distress at the bottom, then start the whole wash, rinse and repeat cycle again. If they crash the markets soon, they should be able to achieve a long-held objective of getting rid of Trump for good measure, since the markets would not recover enough by election time for him to capitalize on it.


Chart courtesy of sentimentrader.com

If this is what is setting up, it is incumbent on us to keep an eagle eye out for any warning signs that the markets may be about to about to buckle and plunge again. Fortunately, there are a number of things that we can watch that provide early warning of such a development. One important one is the 10-year yield, whose latest chart is shown below. This provided early warning of the spring market crash, as we can see. It is clearly an ominous development that it has been crumbling in recent weeks and is already threatening to break below its March lows. If it does, and especially if it should drop more steeply, it will probably trigger another severe market down wave soon after. This is said with an awareness that it can't actually drop all that much because it is already so low.

The put-to-call ratio is at a very low level, indicating universal bullishness and complacency, and is at the sort of extreme that we saw last February before the market caved in.


Chart courtesy of sentimentrader.com

Next, keep a close eye on oil. On our light crude chart we can see that it is rounding over beneath heavy resistance having closed a big gap. Ominously, the 50-day moving average is drawing close to the still falling 200-day, so that these averages are still in bearish alignment with the potential for a big drop.

It isn't hard to see why it could suffer a big drop, despite all the recent market manipulation that has massaged it higher and higher, because the plain fact of the matter is that if they want to close down economies around the world in pursuit of their dream of crushing the masses, then there is going to be an awful lot more oil sloshing around than there is demand for.

The Bollinger bands, which are shown on a version of the year-to-date chart for light crude in the latest Oil Market update, are pinching in tightly, suggesting that a big move is now imminent.

Next copper, whose big recovery rally from the March low to the present appears to have been driven both by a misplaced belief that demand will recover, and an even bigger misconception that demand will recover in China, which is going to be more difficult now that a large part of the heartland of the country is underwater, with the possibility of the Three Gorges Dam being breached for good measure. As we can see on copper's latest three-year chart, it has stalled out at a zone of strong resistance, which it arrived at in an overbought state.

Greatly increasing the chances of copper reversing and going into retreat very soon is its COT structure. On its latest COT chart we see that Dumb Money—the Large Specs—are now heavily long the metal after being heavily short at the March low. This COT chart looks very bearish and it is known that copper is a lead indicator for the markets, hence its nickname, Dr. Copper. So this is another clear warning sign.

Finally, GDX hit a trendline target in a very overbought state last week, with sentiment toward the precious metals sector at positive extremes. While we could not be more bullish on gold, and especially silver for, the longer term, that does not mean that they can't get dragged down temporarily in a correction by a crashing stock market. That's why we are pulling in stops and doing GDX puts as insurance.

This is quite a battery of indications calling for a major market downturn soon, I'm sure you will agree. Could the Fed override it all and keep the markets heading ever skyward by pumping more and more? Maybe, but as I've pointed out here they may not want to, since their Prime Directive, which is to transfer wealth from the lower classes to the upper classes or to those who control society, should make it irresistible to them to crash the markets here to crush the little guy, and provide yet another opportunity to mop up his holdings on the cheap, and probably seal Trump's fate into the bargain.

Originally published on CliveMaund.com on Aug. 2, 2020.

Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years' experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Statements and opinions expressed are the opinions of Clive Maund and not of Streetwise Reports or its officers. Clive Maund is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation. Clive Maund was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Charts provided by the author.

CliveMaund.com Disclosure:
The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.

Precious Metals Landmine

Source: Michael Ballanger for Streetwise Reports   08/02/2020

Sector expert Michael Ballanger offers his latest analysis of how current economic circumstances are driving the gold and silver bulls.

Before I begin this weekly missive (which is being penned on a Wednesday due to my impending cruise to the northern habitats of Georgian Bay), I need to present one quote that for me summarizes everything there is to know about risk management in the capital markets universe:

"It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so." —Mark Twain

As we speak, the world is unanimously bullish on silver, with gold a hair's breadth behind, and judging from volume inflows into the SLV and GLD exchange-traded funds (ETFs), the big money boys (who are hard pressed to spell"inflation," let alone prepare for it) are in the process of allocating. Seeing their competitor asset managers buying into names so foreign and so hideous, like Newmont Corp. (NEM:NYSE) (pronounced "Noo-maunt") and Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) (pronounced "Bare-ick"), is forcing these Tesla Inc. (TSLA:NASDAQ)-trading behemoths to secure exposure in the precious metals names and the ETFs in order to stay snug to the expected returns everyone will be getting with a 3% allocation to precious metals.

If they opt to avoid the metals, and they move 50% higher, the money managers run the risk of "underperforming peers," after which the Fund of Funds allocators throw them under a bus and they experience a 35% redemption nightmare.

However, if the metals crash, and they lose 50% on that 3% allocation, everyone loses together, and their mediocrity provides assets-under-management protection by hiding within the (incorrect) consensus allocation to the metals. Clients actually lose money, but the manager does not lose assets. What a wonderful base case argument for owning an asset that has outlasted hundreds of fiat regimes in the last 5,000 years.

landmine1

Why I included the Twain quote is that it is rooted in one of the many cognitive biases found in the world of investing. Everyone today "knows for sure" that gold and silver are headed to price levels many times higher than where they today reside; what they "don't know that gets (them) into trouble" is when (and from what optimum entry point).

When I write that daily sentiment numbers for silver are approaching 95, and that the RSI (relative strength index) for SLV is at 85, that is precisely "everyone knowing for sure." Sentiment indicators such as DSI and RSI have us ripe for a disappointment and the reason is simple: the primary driver for the March-August advance has been an anti-dollar policy initiative by U.S. political leaders and its central bank. If they start to pull back the punchbowl, the dollar will rally, and the primary precious metals driver gets kneecapped.

landmine2

The most recent COT for the U.S. dollar index has the Commercials long 6,783 contracts, whereas at most major tops, they are net short nearly 50,000 contracts. This is analogous to where we were in December 2015, with gold at US$1,045/ounce; commercials were actually net long that week for the first time ever (at least since I began monitoring the COT), and it was what prompted my "bottom" call that has now become a matter of legend (at least in my own mind). That the commercials traders are positioned for an advance is important, because the chart clearly demonstrates the inverse correlation between the USD Index and the USD-denominated prices for gold, silver and copper.

Accordingly, I am now modestly hedged, using the SLV October $23 puts, and underweight the Senior and Junior Miners, as we await the fireworks associated with a big USD index short-covering rally that could easily morph into a face-ripper, as all of these newbie traders that have suddenly become silver gurus puke out their losing positions in a fit of Millennial outrage.

This does not translate into a sell signal for the junior developers (as discussed last week) because they are still (on a case-by-case basis) largely underowned and underpriced.

The translation that should resonate is that we should refrain from chasing these silver names, and it does not matter what the nature of the story is or how compelling a yarn the promoters are telling. This advice pertains to all GGMA holdings as well, as even the mighty Getchell Gold Corp. (GTCH:CSE) has corrected over 20% off the 2020 high print. If I can add to Getchell in the CA$0.30s, I will happily do so for all of the reasons previously related in prior missives and email alerts.

The time for de-risking is upon us, but understand that it is the last two weeks of August that have historically been my "accumulation" zone, after what has usually been a dull summer. However, since the COVID pandemic has thrown many of the historical cycles out of whack, I am being a great deal more eagle-eyed this year than I have been in prior years, because the bargain prices historically present in August actually appeared in March.

Furthermore, since the Fed has been able to successfully thwart the deflationary impact of the lockdown (at least thus far), the correction I have been looking for has been delayed (but not avoided) until perhaps after the November elections in the Land of the Free and the Home of the Brave. So, if we go through August and prices continue to remain elevated, I will sit on my holdings, modestly hedged via the SPY and SLV puts, and if the madness of crowds continues to attract legion upon legion of new Miningjunkie-wannabes to the table, we have lots and lots of developer positions to offer at our prices versus their prices.

The bull market that began in December 2015 at US$1,045/ounce is now over four-and-one-half years old, and what is important to remember is the duration of past bulls: the 1970s bull lasted nine years and the 2002–2011 bull lasted seven years. The gold price is now at all-time highs and ahead over 87% from the 2015 lows. The 1971–1980 bull advanced 2,325% ($35-$850), while the 2002–2011 bull advanced 669% ($250-$1,923). So when I consider the magnitude of debt-creation by the central bankers and the global sovereign treasury politicos, the current bull has a great deal more upside looking out to 2022 and beyond.

To the extent that it is debt, in the final analysis, that must determine gold prices, and since it is the dollar that is in the deepest trouble looking out five or ten years, the fiat currency regime that has dominated the old World Order becomes compromised and inevitably, financial chaos will ensue. I believe that, notwithstanding a technical rebound in the near term, the decline in dollar since March is the world losing confidence in the supremacy of the U.S. in all aspects.

In January, I told all subscribers that the problem with the world back then was not China-Russia relations or the Middle East or global warming or Black Lives Matter. I told you that it was that four-letter word that haunts every bond trader the world over: debt. What caused Jerome Powell to execute the "pivot" last fall? Debt. Liquidity concerns surrounding dealer long positions in debt forced the REPO actions. I said then and repeat now: REPO was the starter's pistol going off, marking the race to the bottom for the credit markets and the beginning of the Great Unraveling. What caused the Fed balance sheet to explode northward in March? Debt. Why is the Fed today buying all the toxic garbage junk bonds issued by corporate America to finance stock buybacks? Debt.

Historians like to call these events the "bursting of a bubble," but they are more akin to the first water seeping through a crack in dam or dike. The more compromised that crack becomes, the faster the water flows, and the faster the water flows, the more pressure on the crack. Eventually, the entire structure crumbles and the waters flood the countryside.

This is exactly where we are. Powell and his global henchmen have been creating new debt to accommodate existing debt, which is like firing a water cannon at the crack to keep back the seas.

Eventually, all debt will have to be repudiated and the fiat currency regime of dollar hegemony replaced with some mechanism that prevents the destruction of purchasing power and the disrespect and humiliation of savers. That is what the global markets are now reflecting because those U.S. dollars are buying less and less of everything (stocks, gold, copper, art, etc.) and that is not about to change.

Your author is a multi-decade investor in precious metals and in the companies that explore for, develop and produce them. I remain a staunch bull on gold and silver looking out to 2021–2022, but when markets go "vertical" and when the blogosphere and Twitterverse all join in with a thunderous chorus of bullish harmonics, it is time to step back and take a few chips off the table.

Originally published July 29, 2020.

Follow Michael Ballanger on Twitter @MiningJunkie.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger's adherence to the concept of "Hard Assets" allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Michael J. Ballanger: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: Getchell Gold. My company has a financial relationship with the following companies referred to in this article: Getchell Gold. I determined which companies would be included in this article based on my research and understanding of the sector. Additional disclosures are below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Getchell Gold, Tesla and Newmont Corp., companies mentioned in this article.

Michael Ballanger Disclaimer:
This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

( Companies Mentioned: GTCH:CSE, )

Junior Miner Begins ‘Aggressive’ Exploration on BC Gold Prospect

Source: Maurice Jackson for Streetwise Reports   07/31/2020

The CEO of NV Gold provides an update on his company's projects in British Columbia and Nevada in this conversation with Maurice Jackson of Proven and Probable.

Maurice: Joining us for our conversation is Peter Ball of NV Gold Corp. (NVX:TSX.V; NVGLF:OTC). We're delighted to have you back on the program as NV Gold continues to have more and more exciting news for shareholders, coming from the newly acquired high-grade Exodus Gold Project located in BC (British Columbia). But before we begin, Mr. Ball, [what] is NV Gold, and what is the opportunity the company presents to the market?

Peter Ball: NV Gold is an exploration company focused on finding the next multimillion-ounce gold deposit [and] that has put together what we believe [are] some of the best and brightest tactical minds, including Dr. Quinton Hennigh, Dr. Odin Christensen, John Watson. Specifically, [we have] a focus on making discovery, and we've got a busy year ahead of us.

Maurice: Let's visit the high-grade Exodus Gold Project, where the company recently embarked on a very, very aggressive exploration program. What type of work is being conducted on-site now? And what have you learned so far about the Exodus Gold Project since the acquisition?

Peter Ball: On July 6 we announced the acquisition and the optioning into the project after we reviewed it after four months. And what we're learning is the intelligence that we've gained from not only the vendors that have been working on the project for three years, but we've engaged the vendors as [our] project manager, this gentleman named Max Keogh, a really smart geologist. [We're] taking his level of intelligence over three years, combined with another very smart individual, Mr. James Maxwell—both professional geologists, qualified persons according to 43-101. They've done a lot of work in three years.

But what we've done since July 6 is actually. . .completed a property-wide, high-resolution magmatic and radiometric survey. So we're starting to understand that, taking their intelligence [and] their knowledge of the project, and now starting to look at the early, or what we call freshly collected, data from the geophysics survey, the information from ground truthing that they've done and looking at the early stages of this geophysics. There's a great correlation. We're seeing the structures that they thought were there are sitting there under the ground.

So we're learning a lot. We've got the geophysics done. We're starting to get the information over here in the next couple of weeks. And we're also energized that today was the second day that we've been on-site with our exploration team. They're going to span out, look at the central core, and then they're going to do the northern and southern boundaries. This is a large property. We've expanded the property position by nearly close to 8%¬–9%. We found some other interesting items of the project, which we'll probably talk about over the next few weeks as we do our due diligence.

Maurice: NV Gold has a stellar technical team. And if they're ecstatic about what they're seeing already, that bodes well for the future of the company. We referenced the aggressive exploration program on the Exodus Gold Project, and I know it's early days, but when does NV Gold expect to have drill targets defined?

Peter Ball: That's interesting. So when we found this project, there [were] already drill targets defined; they've been working on this project for three years. What we want to do—again, this isn't our money, this is a shareholder's money—we want to ensure that when we do look to drill, we want to make sure every dollar on the drill bit is used efficiently and effectively. And we're vectoring into exactly where we should.

So we have drill targets identified, but we've got two months of intense surface ground truthing, we'll call it. And we will push forward probably to a dual program based on current targets, new targets and final targets for October of this year—our goal [is] September, October.

Maurice: We focused our efforts thus far on the Exodus Gold Project, but that's just really the tip of the iceberg. NV Gold has a commanding land package in Nevada with 15 highly prospective projects. Any developments to share with us from Nevada?

Peter Ball: Nevada is moving along at a fair pace. Also, we will be starting our program at our Slumber Project, completing some geophysics, following up from interesting results from the fall of 2019. So that'll commence in August, based on that CSAMT survey, which that just means this geophysical survey is going to help us determine where, within really a meter or two, where would we stick our drill hole, based on what the results are subsurface of what the geophysical survey will outline.

The secondary is another project, which we're just on boots on the ground now; we'll be talking about it in the next couple of weeks. It's Sandy, a great project. Picked it up for staking costs only, historical drill information wrapped upright inside of another active mining company, where they're getting drill results. We got it for free for $2,000, and we're going to be doing some ground shooting, push towards a drill program.

Our projects are not grassroots. These are drill-ready projects that we select two to three years. Recently, with the surge in gold, we're seeing more people in our data room. It's like Amazon shopping, NV Gold's extensive database and our projects. So we're looking to do some potential sales of assets as we move forward. It's interesting. This is the best time to drill in Nevada, so if another company wants to drill it, we've got projects for them. But we're focused on two, Slumber and Sandy.

Maurice: Switching gears, let's look at some numbers. The share price has performed quite well this month. What is the current capital structure and share price?

Peter Ball: Just to bring a little bit of a catch up on where our share price was. On May 26 we closed the financing at $0.14, oversubscribed. Great new shareholders, great new institutions. Right now we're trading at $0.37. We hit a high of $0.48 on Monday. Lots of interest—of course, gold's helping us—but we've got lots of action. News flow; the market's expecting more to come. And our share structure is about 55 million issued, so market capitalization of about $CA20 million.

Maurice: Before we close, Mr. Ball, gold hit an all-time high this week. How does the high gold price with a low oil price fit into the value proposition of NV Gold?

Peter Ball: It's always interesting watching what's happening with the oil price and what's happening around the world in regards to how the economy is allowing issues to help the gold price. I'll focus on the gold price. I'm not an oil and gas guy, but we know where gold is currently. We're sitting in the $1,900s in the U.S., which in Canada matches quite well with our BC project, is in the $2,500 range, the highest price in Canadian history.

What this does for a junior, which relates to your previous question of the capital structure: If you've got a junior exploration company run by what we believe is some of the best technical minds, focused on a gold discovery, and you add in where we're calling right now, Christmas in July for our shareholders, and the market in general—we've been waiting for this for a lifetime. High gold price, highly active junior company with lots of news flow, focused on a discovery with a very interesting high-grade gold discovery.

This gold price factors in significantly to the value proposition, as you said, in regards to where we could go. We're going to make every effort to get there. We're going to execute, follow through, be 100% available and transparent to our shareholders.

Maurice: Names excluded, you shared with me before our conversation here today that you're receiving several phone calls from some high-net-worth individuals. Can you share some of that conversation with us?

Peter Ball: Names excluded, the market likes a management team that takes ownership by owning large substantial of their company with great shareholders, institutional coverage, and an active company focused on a big win or hunting for the next elephant. They see that's what we're doing. They see the technical team we have. For example, we've had a couple of groups that have accumulated probably upwards of a million, 2 million and a half, shares in the market, from CA$0.25 to CA$0.45.

They see this as an opportunity to capitalize on the next stage, which is a very active program of executed programs in two countries, [in] British Columbia and Nevada, with lots of news flow. And they're saying, "If you ever want to do a financing, we're there for you. We want to support you and your team."

And that's where the market is today. The market is very excited about where the price of gold has led to providing opportunities for NV Gold, strong capital structure, great management, great ownership, great institutions. Eric Sprott is one of our largest shareholders. And we are very proud to have Bob Moriarty as a shareholder. It's going to be a good year, we're excited.

Maurice: Mr. Ball, if someone wants to get more information about NV Gold, please share the contact details.

Peter Ball: The website is www.nvgoldcorp.com. I don't have a middle person, so e-mail me, peter@nvgoldcorp.com. I'll answer everybody within an hour, guaranteed. And just another layer—you may call me at (888) 363-3883. That number just goes to me. So you're going to get me. You're going to leave a voicemail for me, not anybody else. And I'll get back to you within an hour.

Transparency, we represent our shareholders, we're big shareholders. Phone us or email us at any time.

Maurice: Mr. Ball, is always a pleasure wishing you and the NV Gold team the absolute best, sir.

NV Gold trades on the TSX.V: NVX | OTC: NVGLF. NV Gold is a sponsor of Proven and Probable. And we are proud shareholders for the virtues conveyed in today's message.

Before you make your next bullion purchase, make sure you call me. I'm a licensed representative for Miles Franklin Precious Metals Investments, where we have several options to expand your precious metals portfolio, from physical delivery, offshore depositories and precious metal IRAs. Call me at (855) 505-1900, or you may e-mail maurice@milesfranklin.com. Finally, please subscribe to Proven and Probable for mining insights and bullion sales. Subscription is free.

Maurice Jackson is the founder of Proven and Probable, a site that aims to enrich its subscribers through education in precious metals and junior mining companies that will enrich the world.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Maurice Jackson: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: NV Gold. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: NV Gold are sponsors of Proven and Probable. Proven and Probable disclosures are listed below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures for Proven and Probable: Proven and Probable LLC receives financial compensation from its sponsors. The compensation is used is to fund both sponsor-specific activities and general report activities, website, and general and administrative costs. Sponsor-specific activities may include aggregating content and publishing that content on the Proven and Probable website, creating and maintaining company landing pages, interviewing key management, posting a banner/billboard, and/or issuing press releases. The fees also cover the costs for Proven and Probable to publish sector-specific information on our site, and also to create content by interviewing experts in the sector. Monthly sponsorship fees range from $1,000 to $4,000 per month. Proven and Probable LLC does accept stock for payment of sponsorship fees. Sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.

The Information presented in Proven and Probable is provided for educational and informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The Information contained in or provided from or through this forum is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information on this forum and provided from or through this forum is general in nature and is not specific to you the User or anyone else. You should not make any decision, financial, investments, trading or otherwise, based on any of the information presented on this forum without undertaking independent due diligence and consultation with a professional broker or competent financial advisor. You understand that you are using any and all Information available on or through this forum at your own risk.

Images provided by the author.

( Companies Mentioned: NVX:TSX.V; NVGLF:OTC, )

Rockridge Prepares to Drill High Grade Gold in Ontario

Source: Bob Moriarty for Streetwise Reports   07/31/2020

Bob Moriarty of 321gold profiles this explorer with a gold project in Ontario and a copper rich VMS deposit in Saskatchewan.

I suspect we have either started the correction I have been predicting or are about to. Silver spiked as it does every time it makes a temporary top as both metals show signs of schizophrenia not knowing just which direction to go in next.

We have way too many bulls and the cries of "short squeeze" have gotten shrill as they do with every top, temporary or not. Markets go up and markets go down. That's the way they are supposed to work. A correction on a regular basis is not an option; it is mandatory no matter how violent the bull.

Rockridge Resources Ltd. (ROCK:TSX.V) has a pair of interesting projects, a gold project in Ontario in the Greenstone belt surrounded by a host of other gold mines nearby and a copper rich, VMS deposit in Saskatchewan.

For now Rockridge's primary focus is on their Raney Gold project with about 2,800 square km located in mining friendly Ontario near both the Cote project owned by Iamgold and the Timmins gold camp. Timmins has produced over 70 million ounces of gold.

Rockridge recently completed a nine-hole 2,070-meter drill program with some interesting results. The best assay showed a 28.0 g/t gold assay over 6 meters. The best historic result was 6.1 g/t gold over 8.0 meters from 2009.

The company plans on a phase two drill program of 10 holes and 3,000 meters of core to begin shortly to follow up on the phase 1 results.

Rockridge is buying 100% of the Raney gold project subject to a 2% NSR for a total of $160,000 in cash, 450,000 shares and a total work commitment of $900,000.

Their second major project is located in Saskatchewan and is called the Knife Lake VMS property. In a 2019 drill program Rockridge came up with some excellent results including 2.03% Cu, 9.88 g/t Ag, 0.19 g/t Au and 0.36% Zn over 37.6 meters from 11.2 meters depth. The project has an existing 43-101 resource showing 3.8 MT @ 1,02% Cu Eq and 7.9 MT @ 0.67% Cu Eq.

Knife Lake

Ron Netolitzky is an advisor to Rockridge. Ron has participated in more important gold discoveries than anyone else I know of and that speaks a lot about both management and their projects.

Rockridge is aggressively taking steps to raise money while it is available to move the company forward. They are at that boring stage where only the price of gold and drill results matter. But they are in elephant country and are hitting the edge of something interesting already.

Rockridge is an advertiser and I have bought shares in the latest PP. Do your own due diligence.

Rockridge Resources
ROCK-V $0.155 (Jul 30, 2020)
RRRLF-OTCQB 51.1 million shares
Rockridge Resources website

Bob Moriarty
President: 321gold
Archives
321gold

Bob Moriarty founded 321gold.com, with his late wife, Barbara Moriarty, more than 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Rockridge Resources. Rockridge Resources is an advertiser on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

( Companies Mentioned: ROCK:TSX.V, )

Junior Miner’s Shares Jump on Acquisition News

Source: Jay Taylor for Streetwise Reports   07/30/2020

Sector expert Jay Taylor of J. Taylor's Gold, Energy & Tech Stocks provides his take on Irving Resources' plan to acquire the Yamagano gold mining license.

Irving Resources Inc. (IRV:CSE; IRVRF:OTCMKTS)
54,990,799 shares

On June 23 Irving's shares popped upward by ~14% on news of Irving's plans to acquire the Yamagano gold mining license from Shimadzu Ltd. Irving Resources Inc. has signed a non-binding term sheet with Shimadzu Ltd. to acquire the 5.25-square-kilometer Yamagano mining license, site of extensive historic high-grade gold vein mining in southern Kyushu, approximately 11 kilometers (11 km) southwest of the large, high-grade Hishikari gold mine.

taylor1.7-28-2020

Irving and Shimadzu have begun work on a definitive mineral property option agreement; the terms of the option agreement will be announced once signed. In addition, the Kyushu Bureau of Economy, Trade and Industry has accepted the filing of 23 new mineral prospecting licenses totaling 65.19 square kilometers. A multistep review now begins for the approval of these licenses. An engineering division of Mitsui & Co. Ltd. (MITSY:NASDAQ) is assisting Irving through the license approval process.

Already Irving is one of my personal favorites, but this potential acquisition ramps up my excitement for this story into the future. Following are some of the highlights of the Yamagano high-grade vein mining district that say why.

The Yamagano mining district is situated approximately 11 km southwest of the large, high-grade Hishikari gold mine, which is host to innumerable historic gold mine workings, some dating back to 1640 AD, during the early Edo Period in Japan. Mining focused on a multitude of high-grade epithermal gold veins hosted by volcanic rocks blanketing this region.

Yamagano gold production is reported to be approximately 80 tonnes, or 2.57 million ounces. Amazingly, this mining right tenement has seen no modern exploration, including drilling. Yamagano is the major nearest past producer neighbor to the exceptionally high-grade Hishikari Mine.

Gold veins are easily identified by geophysics, so this should be a rather high probability success story. Gold-bearing veins here are associated with an area of anomalously high gravity, thought to represent a buried uplift, or dome, in underlying denser basement sedimentary rocks. This geologic feature is believed to have focused gold-depositing hydro- thermal fluids to ascend into overlying faults and fissures where they formed extensive high-grade vein networks.

A gravity high was recognized very early as an important ore control at the Kushikino gold mine (56 tonnes or 1.80 million ounces [Moz] Au [gold] produced) situated approximately 39 km southwest of Yamagano. In fact, based upon this geologic model, initial targeting of the famous Hishikari deposits (248.2 tonnes, or 7.98 Moz Au produced) was driven largely by recognition of an anomalous gravity high underlying that area. Irving believes the gravity high at Yamagano reflects a buried dome of basement rock and that, given the large footprint of this feature, there is considerable prospectivity for veins elsewhere across the property.

taylor2.7-28-2020

Irving now holds four important new mineral prospecting licenses immediately east of the Yamagano mining, right where the extension of gravity feature discussed above is situated. This area is covered by post mineral volcanic rocks and has not been explored for blind high-grade Au veins. Irving believes this area is highly prospective for natural continuations of the Yamagano vein network. In fact, the majority of the local gravity anomaly lies within these new mineral prospecting licenses.

But that's not all! As noted in the area map above, Irving already holds four new blocks of mineral prospecting licenses, the Satsuma A, Satsuma B, Satsuma C and Satsuma D projects, each covering a discrete gravity anomaly similar to that recognized at Yamagano. Each of these gravity highs lie within areas covered by young, post-mineral volcanic rocks. Similar to Yamagano, Irving considers these highly prospective when considering the "gravity high" model discussed above.

Importantly, Satsuma A and Satsuma B lie between the Yamagano gold district and the Kushikino mine in a trend Irving considers highly prospective for new discovery. Satsuma C and Satsuma D also lie within areas covered by young, post- mineral volcanic rocks with no known history of exploration.

A Reminder: Also keep in mind that Irving and Newmont Corp. (NEM:NYSE) have an exploration alliance in Japan. All landholdings discussed above are subject to the Irving-Newmont exploration alliance, and both companies are currently discussing the best path to advance exploration at each project.

Most Important: Don't forget that although the veins in these deposits are narrow, they are hosted in silica material that is highly valuable and sought after by smelters throughout Japan. So, the business model for Irving requires no mill construction. The high-grade silica-hosted gold is simply mined, put on a ship and sent to one of the smelters that not only gives Irving 100% of the gold but actually pays a bit for the silica material. It's an amazing business model that even has Brent Cook raving about it.

As he followed the demolition of the U.S. gold standard and the rapid rise in the national debt, Jay Taylor's interest in U.S. monetary and fiscal policy grew, particularly as it related to gold. He began publishing North American Gold Mining Stocks in 1981. In 1997, he decided to pursue his avocation as a new full-time career—including publication of his weekly J. Taylor's Gold, Energy & Tech Stocks newsletter. He also has a radio program, "Turning Hard Times Into Good Times."

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) Jay Taylor's disclosures are below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Irving Resources. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Irving Resources and Newmont Corp., companies mentioned in this article.

Charts and graphics provided by the author.

Disclosures: J Taylor's Gold, Energy & Tech Stocks (JTGETS), is published monthly as a copyright publication of Taylor Hard Money Advisors, Inc. (THMA), Tel.: (718) 457-1426. Website: www.miningstocks.com. THMA provides investment ideas solely on a paid subscription basis. Companies are selected for presentation in JTGETS strictly on their merits as perceived by THMA. No fee is charged to the company for inclusion. The currency used in this publication is the U.S. dollar unless otherwise noted. The material contained herein is solely for information purposes. Readers are encouraged to conduct their own research and due diligence, and/or obtain professional advice. The information contained herein is based on sources, which the publisher believes to be reliable, but is not guaranteed to be accurate, and does not purport to be a complete statement or summary of the available information. Any opinions expressed are subject to change without notice. The editor, his family and associates and THMA are not responsible for errors or omissions. They may from time to time have a position in the securities of the companies mentioned herein. No statement or expression of any opinions contained in this report constitutes an offer to buy or sell the shares of the company mentioned above. Under copyright law, and upon their request companies mentioned in JTGETS, from time to time pay THMA a fee of $250 to $500 per page for the right to reprint articles that are otherwise restricted solely for the benefit of paid subscribers to JTGETS.

To Subscribe to J Taylor's Gold, Energy & Tech Stocks Visit: https://www.miningstocks.com/select/gold. Copyright @ 2020Taylor Hard Money Advisors, Inc. All Rights Reserved.

Note: Article originally published on June 26, 2020.

( Companies Mentioned: IRV:CSE; IRVRF:OTCMKTS, )

Silver Sets the Pace for Precious Metals

Source: McAlinden Research for Streetwise Reports   07/30/2020

McAlinden Research Partners reports on the conditions driving the accelerating silver market, and sees "more upside on the horizon."

Summary: The rally in silver prices has accelerated this summer, pushing spot prices to a six-year high this week. While the debasement of the dollar by huge fiscal and monetary stimulus has played a role in the broader outperformance of precious metals, silver has benefited from a rebound in industrial activity, as well as historically low relative pricing when compared to gold. [Related exchange-traded funds (ETFs): iShares Silver Trust (SLV), Global X Silver Miners ETF (SIL).]

The precious metals have had quite a run over the last few months, and silver has been at the top of the heap.

To receive all of MRP's insights in your inbox Monday–Friday, follow this link for a free 30-day trial. This content was delivered to McAlinden Research Partners clients on July 22.

Spot prices have now pushed above $21/oz, the highest level in six years, according to analysts at Commerzbank. This new high is in stark contrast to the 11-year low silver hit back in March.

Industrial Growth Powered by Solar Boom

Silver has great appeal in times of economic recovery because it is not only a safe haven asset, but an industrial metal as well, sporting applications in everything from electronics to solar panels. The reopening of Chinese factories in recent weeks and a rally in base metals such as copper also is supporting demand.

Investors have picked silver as a way to play this "green" recovery, Colin Hamilton, analyst at BMO Capital Markets, told the Financial Times. Governments across the world have approved more than $50 billion of environmentally friendly stimulus measures this year, according to BMO.

Earlier this year, the Silver Institute released a report, produced on its behalf by CRU Consulting, estimating that demand for silver in photovoltaic (PV) cells, used for solar power, will be a cumulative 888 million ounces between this year and 2030. BMO is even more bullish on silver's utility to the solar industry, projecting around 1.5 billion ounces of PV demand from 2020 through 2030.

Technicals and Fundamentals

It also helps that, until recently, silver was likely the cheapest it has ever been, in relation to gold.

While the wave of volatility and the resulting liquidity crunch brought on by the height of the Covid-19 pandemic wiped out precious metals prices at the time, it only strengthened the long-term case for precious metals—particularly silver.

Back in March, we wrote that silver was the most attractive play in precious metals, trailing the price of gold by more than it ever had before. Back then, the gold-to-silver ratio was so extended that it had just broken a 5,000-year-old record, peaking around 125. This ultimately set the stage for the dramatic rebound in silver prices that we are now seeing.

Though the ratio has now tightened to just below 90 on the back of silver's surge, that is still well above the longer-term average of about 60.

As Kitco writes, the silver market is currently on pace to surpass gold's performance for the year. With its latest rally, silver prices are up 26% year to date. Meanwhile, gold prices are up 21% for the year. Silver's outpacing of gold looks likely to continue, as the CFTC's disaggregated Commitments of Traders report for the week ending July 14 showed that, although money managers decreased their speculative gross long positions in Comex gold futures by 2,410 contracts to 177,400, silver futures rose by 3,404 contracts to 65,615. At the same time, short positions on silver fell by 3,207 contracts to 22,988.

Fiscal and Monetary Stimulus Spell Weak Dollar, Strong Precious Metals

Though, on a technical basis, silver was a rocket ship waiting to take off, the catalyst that launched it was the US Federal Reserve's continued commitment to keep fixed income yields near all-time lows for the foreseeable future. Additionally, cheap money continues to debase the value of the dollar. The Fed's balance sheet has expanded by nearly $3 trillion, or 60%, since the beginning of the year.

The dollar will be further depressed by a strengthening euro after a summit of European Union leaders in Brussels finally came to agreement on a huge spending program, including a €750 billion rescue fund. The euro on Tuesday climbed to its highest against the U.S. dollar in more than four months, as ING analysts told Reuters that they are looking for "more gains to $1.20 later this year," because the recovery fund agreement is significant enough "not to prompt investors to exit their long euro positions," particularly against the dollar.

"The €390 billion of grants and €360 billion of loans that are now being talked about [in Europe] mean additional mountains of debt and further currency debasement," said Daniel Briesemann, analyst at Commerzbank, in a note. "Gold should therefore profit as a store of value. Further financial aid to overcome the corona crisis is likewise being discussed in the U.S. This is also necessary given that the first corona emergency aid packages will soon come to an end."

While some worry that the lack of inflation could pare the hedging value of precious metals, we believe that inflation will recover more quickly than most expect as part of a V-shaped economic recovery.

The U.S. Dollar Index (DXY) may be a grave indicator of just how close the greenback is to correction territory. Over the last three months, the DXY down more than 5% and Barron's warns that the index's monthly closing chart shows that the dollar stalled at a 33-year trendline of resistance. Over the last few decades, the DXY piercing that trendline has been the signal of an even more accelerated decline on the horizon. At the time of this writing, the DXY is holding around 95.18. Barron's projects that, if the index falls below 95, that would indicate a further decline of at least 10%.

MRP highlighted the dollar to precious metals correlation a number of times over the last year and a half, especially in regard to the effect of real rates and expansion of the monetary base, going back to March 2019, when we released our "Time for Gold" Viewpoint report. Back then, spot prices for the yellow metal were around $1,300/ounce. Since then, gold has surged to about $1,838/ounce, a gain of more than 40%. Recently, real rates in the U.S. plummeted and went negative, while multi-trillion-dollar stimulus packages have undoubtedly pushed the monetary base to new heights.

Just about a year ago, we noticed that silver had largely missed out on the early portion of the gold rally. As a result, we added long Silver & Silver Miners to our list of themes on July 22, 2019. Since then, the iShares Silver Trust (SLV) and Global X Silver Miners ETF (SIL) have returned 28% and 53%, respectively, outperforming the S&P 500's 9% over the same period.

Following a broad rebound in silver prices and miner stocks, the SLV and SIL handily beat out gold and gold miner ETFs, after soaring 20% and 19% over the last two months. The SPDR Gold Shares (GLD) and VanEck Vectors Gold Miners ETF (GDX) rose just 5% and 12%, respectively.

silverchart7-20-1

silverchart 7-20-2

 McAlinden Research Partners McAlinden Research Partners (MRP) provides independent investment strategy research to investors worldwide. The firm's mission is to identify alpha-generating investment themes early in their unfolding and bring them to its clients' attention. MRP's research process reflects founder Joe McAlinden's 50 years of experience on Wall Street. The methodologies he developed as chief investment officer of Morgan Stanley Investment Management, where he oversaw more than $400 billion in assets, provide the foundation for the strategy research MRP now brings to hedge funds, pension funds, sovereign wealth funds and other asset managers around the globe.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure:
1) McAlinden Research Partners disclosures are below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

McAlinden Research Partners:
This report has been prepared solely for informational purposes and is not an offer to buy/sell/endorse or a solicitation of an offer to buy/sell/endorse Interests or any other security or instrument or to participate in any trading or investment strategy. No representation or warranty (express or implied) is made or can be given with respect to the sequence, accuracy, completeness, or timeliness of the information in this Report. Unless otherwise noted, all information is sourced from public data.

McAlinden Research Partners is a division of Catalpa Capital Advisors, LLC (CCA), a Registered Investment Advisor. References to specific securities, asset classes and financial markets discussed herein are for illustrative purposes only and should not be interpreted as recommendations to purchase or sell such securities. CCA, MRP, employees and direct affiliates of the firm may or may not own any of the securities mentioned in the report at the time of publication.

Analyst: A High-Grade Copper Prospect Beside a Giant

Source: James Kwantes for Streetwise Reports   07/29/2020

James Kwantes of Resource Opportunities outlines the investment thesis behind GSP Resource Corp., which is exploring prospects in British Columbia adjacent to the working Highland Valley Copper Mine.

Dwight Eisenhower was in the Oval Office and America was still on the gold standard when British Columbia prospector Dick Billingsley first staked mining claims. Then 14, Billingsley pounded in wood stakes north of Rossland in British Columbia's West Kootenays on behalf of an uncle who worked in the mining industry and speculated on claims on the side. That uncle worked for the Consolidated Mining and Smelting Company of Canada—otherwise known as Cominco, which merged with Teck Resources Ltd. (TCK:TSX; TCK:NYSE) in 2001.

Billingsley has been staking claims ever since. In the process, the 78-year-old Surrey resident has become one of the largest individual claims holders in B.C., with about 120,000 hectares of ground under his control.

Cycles have come and gone, and there have been some big wins. One of them was Tatogga, the property Billingsley and his wife and business partner Gaye Richards vended to GT Gold Corp. (GTT:TSX.V). GT discovered a gold-rich copper porphyry at Saddle North and a high-grade gold discovery at Saddle South, attracting a strategic investment from Newmont Corp. (NEM:NYSE) and hitting a $250-million valuation along the way.

The veteran prospector made the transition from midnight staker to keyboard claims when the province switched to digital claim staking in 2004. But he can still be found bouncing around B.C.'s backroads in his one-ton Ford 350 pickup truck, snowshoes and other supplies on hand in case of emergencies. Different times call for different strategies, however.

"When you want to stake claims you don't do it during the day, you do it between 2 and 4 a.m.—before 7 a.m. Eastern time," Billingsley says with a smile. "At 7 the guys back East are getting up, having their coffee and turning their computers on."

One of Billingsley's claims packages is the Alwin property, which he optioned to GSP Resource Corp. (GSPR:TSX.V) earlier this year for staged cash and share payments. That made Billingsley one of GSP's largest shareholders, and he has since added to his stake both in the public market and in financings, bringing him to just under 10% of outstanding shares.


Dick Billingsley

The Alwin property, which hosts a past-producing underground copper mine, is adjacent to Teck's Highland Valley Copper (HVC) open-pit mine, 17 kilometers west of Logan Lake. Billingsley, to the right at Alwin's "Copper Rainfall" showing, is excited about the potential of identifying more high-grade mineralization at Alwin. The mine was in operation at different times, producing a total of about 235,000 tonnes grading 1.54% copper.

Identifying further high-grade copper mineralization is also the mission of Simon Dyakowski, GSP Resource Corp.'s young CEO. Dyakowski is a CFA charterholder and former broker who grew up in the business—his geologist father, Chris Dyakowski, is GSP's chairman and a director.

And family ties figure in the story of how Simon secured the Alwin property for GSP. His father Chris ran San Marco Resources Inc. (SMN:TSX.V) while San Marco explored Alwin between 2005 and 2008. San Marco drilled five shallow holes into the main mineralized trend near the eastern part of the mine workings, and three more holes that tested IP (induced polarization) anomalies north and northwest of the mine.

Results were mixed, and all the data is on the GSP website. The first three holes returned sniffs of shallow higher-grade mineralization, including 3.3 meters (3.3m) of 2.37% copper (Cu) and 0.5m of 8.45% Cu. Hole 4 hit 13.5m of 1.86% Cu from 117m downhole, including 0.9m of 4.1% Cu and 3m of 6.2% Cu. Removing those high-grade sub-intercepts still leaves a residual grade of 9.6 meters of 0.29% copper, slightly higher than the head grade at Teck's HVC. Hole 4 ended prematurely in an old unmapped drift.

San Marco moved onto other projects and the Alwin claims were picked up by Billingsley. CEO Dyakowski believes GSP is well positioned to tag shallow high-grade mineralization, the target of the initial drill program (permitting is well underway). One of the tools at GSP's disposal is a new 3D digital model of the Alwin mine compiled by Renaissance Geoscience Services and released last week. The 3D model—assembled using historical drilling, mining and geological data from prior operators—will help GSP target shallow unmined material in two zones north of the historical Alwin mine.

GSP's objectives are twofold: 1) explore the prospects of an open-pit mining scenario by targeting higher-grade mineralization around the #4 zone; and 2) target lower-grade porphyry-style mineralization to the north. For phase 1, GSP plans to drill two deeper (200-meter) holes into the #4 zone as well as a 600- to 800-meter hole farther north into the porphyry target.

HVC is the largest open-pit copper-molybdenum mine in western Canada. In 2019, the operation produced 121,000 tonnes of copper at grades of about 0.27%, generating $196 million in gross profit for Teck. The Vancouver-based producer is mining increasingly lower grades at HVC and the mine was originally scheduled to close in 2028. However, Teck recently applied to extend the mine life to 2040.

On its website, GSP has a great satellite image of the Alwin/Highland Valley neighborhood in 2004 and 2015, with a sliding bar to make comparisons more easily. Two differences are immediately noticeable: 1) the amount of logging that has occurred on the Alwin property since 2004; and 2) the extent to which Teck is moving westward toward the Alwin property. If GSP can prove up a near-surface high-grade copper deposit and/or the existence of a copper porphyry system at Alwin, it becomes a pretty compelling target for Teck. However, there are other possible outcomes for Alwin that don't rely on a Teck takeout—two nearby mills, Craigmont and Afton, have spare capacity.

Alwin has a 270-meter below-surface development decline and about 2,700 meters of underground tunneling, as well as 649 diamond drill holes totaling 34,500 meters. One of the prior operators calculated a historical (non-NI-43-101-compliant) resource around the mine workings of 390,000 tonnes grading an average 2.5% copper, assuming 25% dilution. But the mine shut down due to low copper prices before they could tap into that zone.


GSP CEO Simon Dyakowski

GSP's low all-in drilling costs of $175/meter mean the company is poised to expand the drilling if they are successful during the first phase. CEO Dyakowski, pictured, owns more than 12% of shares, accumulating in each financing round and the open market. Insiders hold a total of about 35% of shares. GSP is well structured, with only 14.7 million shares outstanding and a free trading float of about 6 million shares when you take out insider holdings and escrowed stock.

As for Billingsley, he thinks Alwin ore could make a great high-grade feedstock to mix with the lower-grade ore that Teck is mining at HVC. That would increase the operation's profitability ahead of a mine life extension at one of Teck's core assets.

"Alwin could be my next big score," Billingsley says.

GSP Resource Corp. (GSPR:TSX.V)
Price: 0.35/share
Shares out: 14.7 million (18.7 million f-d)
Market cap: $5.15 million

James Kwantes is the editor of Resource Opportunities, a subscriber supported junior mining investment publication. Kwantes has two decades of journalism experience and was the mining reporter at Vancouver Sun, the city's paper of record.

Sign up for our FREE newsletter at: www.streetwisereports.com/get-news

Disclosure: James Kwantes owns GSP Resource Corp. shares and warrants and GSP is one of three Resource Opportunities sponsor companies. This article is presented for information purposes and does not constitute investment advice. All investors need to do their own due diligence and/or consult a financial advisor.

Streetwise Disclosure:
1) James Kwantes' disclosures are listed above.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Resource Opportunities Disclaimer: Readers are advised that this article is solely for information purposes. Readers are encouraged to conduct their own research and due diligence, and/or obtain professional advice. The information is based on sources which the publisher believes to be reliable, but is not guaranteed to be accurate, and does not purport to be a complete statement or summary of the available data.

( Companies Mentioned: GSPR:TSX.V, )