The following is a Guest Post from Andrew O’Donnell of SuperChargedStocks.com. Peter Epstein of Epstein Research has no prior or existing relationship with any company mentioned herein.
The Canadian junior market is coming alive. Short-term and long-term expectations for the price of gold have garnered the interest of the market again, with money looking for safe jurisdictions and a mixture of big ‘elephant hunting’ and smaller scale short-term production. It is still early but the shift has started.
Unlike many industries, mining comes with unique stories. Mine closures don’t always mean resources are no longer present. That’s a reality generalist investors struggle to get their head around. They think you exhaustively mine and search the area, but this isn’t always the case.
The cyclical nature of the markets and the shift in economic models has left some mines and land packages in disarray and with fractured, complicated ownership. It can be a daunting task to reassemble old projects, evaluate old data and convince investors to go into old areas.
Old mines and regions that sat for decades now may be not only economically feasible but also extremely profitable.
New Carolin: big target potential
New Carolin gold is an interesting brownfield story because it checks off a lot of boxes for a potential investor. It is in a tremendous jurisdiction, with commodities that are needed and of high interest in the market now and for the foreseeable future.
The property comes with a great deal of data to analyze and new techniques, equipment and geochemical science to reimagine old producing mines. But it’s not just a renovation story.
There is some big target potential here. The Ladner Gold Project’s stretch of fault is 28km and the land package itself is 144 square km. It was host to the Carolin mine as well as 4 other mines that call out for further modern exploration.
The big potential is the fault system running through the land package– gold has been found there in the past. Detailing, drilling and chasing after that fault could turn up a significant economic resource.
Factors that make New Carolin worth a look
This story is exciting because it combines; a market that is gaining interest, a strength in metals and mining, an investor base that is realizing we need things like copper, silver and even gold for solar panels, cell phones and the electrification of tomorrow. Other critical attributes include:
Tremendous infrastructure assets already in place including kilometers of adits, extensive logging roads and an existing tailings pond, existing grandfathered mine permit Hydro access to the property, 15 km from a willing workforce in Hope BC.
If you are in Vancouver for MIF, Roundup or VRIC you could be up at the Coquihalla Gold Belt of the northern Cascade Mountains by car in just over two hours. This gold belt follows the Hozameen fault structure and is just outside of Hope. Lost Mines has some excellent photos of property, mines and setting.
There was some incredible grade found and, listen, we know that it is exciting and encouraging to get data that builds a case for a future mine. But this process towards production is a process. It is about hitting milestones, reaching the next level, ground proofing and building the case for economic feasibility.
There are several targets we’re going to look at within this district scale opportunity. But there’s one target area from past data that needs further research.
The case for investment
There is gold to be found for the right team. There are 300,000 ounces. There’s a tailing facility and the original permit. This is the main zone New Carolin is renovating and building upon. Four other mines desperately need exploration and 24 other gold occurrences have been identified. There is infrastructure but a new mill will likely be needed if they prove up the resource.
All these considerations are being addressed. It’s a perfect area to develop as far as jurisdictional risk, infrastructure, workforce and accessibility … it’s only 18km from Hope!
The big upside is the potential of what else could be there. The company consolidated the land package a few years back during extremely tough markets and saw potential as modern techniques hadn’t been applied to the properties.
Now, the markets are interested in discoveries and deposits, but grade is vita. And this has high-gold grade potential.
This is not clickbait or overly promotional and I stress this is just some old data. We know this, though: some old fellas back in the 1930s managed to get 15 ounces per tonne from a bulk sample tonnage. New Carolin isn’t expecting that to be the standard but it’s indicative of the type of plumbing pushing old up.
We also know that this is being followed by many newsletter writers. That can sometimes bring a great deal of comfort, especially if you are talking about people like Gwen Preston, Brien Lundin and Greg McCoach.
It may seem like there is no urgency with tax loss selling and the holidays fast approaching but often this can be an ideal time to build into positions. The stock is trading at a steal for a company that has such a detailed plan and possibilities. There is much more to come for New Carolin in 2020 and keep track of the milestones they reach is a great way to pair into a position.
Securities Disclosure: Supercharged Stocks was renumerated for this article.
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