Tuesday, September 17, 2013

Visiting Gold Projects in Nevada

Today, I'm going into a high-grade, underground gold mine.  This will be the third company I've visited in three days.

First, I visited a company that is developing a high-grade gold zone inside a halo of low-grade gold. It has to raise money, but it will have plenty of news to drive the stock higher, and the company has a lot of excellent drill cores that aren't incorporated into their mine plan or even released to the public yet. I could see buying this on a pullback. But I still have more research to do on that one.

Then I visited another company that is fast-tracking a million-ounce+ gold project for production (hopefully) to start in August 2014. 
Gold-bearing breccia at the surface.
The company has multiple projects, including this previously worked pit that has rock grading 0.75 grams per tonne gold.

That colored rock in the middle is the gold-bearing ore
The company has plenty of money, but it going to get loans from banks and equipment makers (Caterpillar) rather than burn through its cash. It's talking to banks about getting a loan at LIBOR +4%, and that shows you how highly everyone thinks of this company. The resource is open on all sides. It has multiple projects, including a joint venture with a large miner, and it can exercise an option to be carried for 25% on that JV.  I'll crunch the numbers when I get back to the office.

As for the mine that I'm visiting today -- it has a cut-off grade of 7 grams per tonnne, and it has visible gold in its veins.  I would like to wait for a pullback to buy this one because it just put out news. Again, I'll crunch the numbers when I get back to the office.

I'll check out two more mines later this week.


  1. Hint: Take a close look at the last resouce at the 7.0 g/t cut-off before deciding.

  2. You mean the fact that the resource went down? That's because it wasn't done properly the first time. The people who are running the mine want an honest estimate. That's not a bad thing. If you want a larger resource, I can understand that argument. But I won't turn up my nose at a rich resource with room to grow.