Sunday, July 14, 2024

3 Small-cap Gold Juniors to Take Notice of $ELEM $GLDR $SOMA


(The information on the three gold companies in this report is not definitive. Instead, this information will drive you to do more due diligence and make an investment decision.)

A different way to invest in gold is to look for great properties. If you bundle the three companies/properties in this piece, you could own three great properties collectively for under CDN2.00 a share.

GOLDEN RAPTURE MINING (GLDR: CSE) is a collection of premier Ontario mining properties in the Rainy River region that have done enough work to unveil potential, below but left a significant amount of gold with great g/t numbers. As of this morning, some numbers will indeed up its profile. Considering the stock has been listed for about two weeks, these results are excellent. Forgive the length of the table, but given the quality of the results, investors must get the whole picture.

First, the newest, being listed in the last month, is Golden Rapture Gold. The Company intends to reactivate past mines in the Rainy River area of Ontario. The property is so new that management has only walked about 5% of it, but the numbers are already impressive over its two projects. The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits. These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.

Mr. Richard Rivet, CEO of Golden Rapture, commented: “I am incredibly pleased that we have just made some essential and rapid steps toward identifying additional high-grade drill-ready targets. We were pleasantly surprised to discover many high-grade quartz veins on the surface, with the majority of them carrying gold. Unlike many exploration companies, we are not just chasing the typical geophysical anomaly but also many vast high-grade gold structures identified on the surface that can be drilled at any time.

1744743.701 g/t Au
1744424.005 g/t Au
49476222.300 g/t Au
1743020.400 g/t Au
49496614.200 g/t Au
49479611.002 g/t Au
174379.360 g/t Au
 Folk4947526.550 g/t Au
4947996.490 g/t Au
174745.580 g/t Au
4949175.540 g/t Au
4947515.490 g/t Au
174835.350 g/t Au
4949674.800 g/t Au 
174864.081 g/t Au
174733.990 g/t Au
174453.940 g/t Au
4949133.781 g/t Au
174813.672 g/t Au
174423.324 g/t Au
174383.295 g/t Au
1744912.262 g/t Au
4949722.224 g/t Au
4947542.123 g/t Au
174111.752 g/t Au
174721.352 g/t Au
4949111.290 g/t Au
4949731.246 g/t Au
4949121.111 g/t Au
174651.170 g/t Au
174651.050 g/t Au
4947671.051 g/t Au

The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits.

These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.

Ryan Yanch CIM, a director of GLDR, states, ‘One extremely important fact is that GLDR’s drilling cost is an industry-leading CDN140 a meter. It is not unusual for other gold comp[anbies to spend CDN200-400 or more a meter. One major contributor to this is that one significant cost is the location of the drilling company. 17 km away from the properties significantly lowers the capital cost and allows a more robust drilling program”. 

Given the uniqueness and exceptional quality of GLDR’s properties, there could be excellent investor support. Gold is rallying, and the prospect of further rises may portend in the shadow of interest rate cuts.

Previous work on the properties quickly removes the ubiquitous ‘drill’ on the property or other tropes. These are serious  businessmen and women with decades of mining and entrepreneurial experience.

In the world of junior mining IPOs, there is a feeling that the stars must align to profit. Au contraire. The keys to investing success are the right properties, management, and, in this case, a rallying gold price.

Numero Deux

Element79 Gold Corp (the “Company”) (CSE: ELEM) (OTC: ELMGF) is a fascinating gold company and the second in our gold triumvirate located primarily in Peru through its flagship Lucero, Peru, property.

(Full Disclosure: James Tworek, CEO of Element79, is an adviser to the GLDR Board. Your humble scribe owns a small position in each Company.)

The past-producing Lucero Mine (“Lucero”) is one of the highest-grade underground mines in Peru’s history, with grades averaging 19.0g/t Au Equivalent (“Au Eq”) (14.0 g/t gold and 373 g/t silver).

In its past 5 years of production, ending in 2005, it produced an average of 40,000oz+/yr.

Assays from March 2023 yielded 21-ore-grade and high-yield up to 11.7 ounces per ton of gold and 247 ounces per ton of silver from underground workings, further validating the potential for a significant high-grade future operation.

Consolidating its focus in this region and its impressive geology, ELEM acquired the Roxana Vein and surrounding 1200ha property, Lucero del Sur 28, via auction held on May 17, 2023. The property is located strategically just east of the high-grade Lucero gold-silver project.

Instead of going into much history, let’s look at the Press release ELEM put out on April 23. New assays were released, and CEO James Tworek stated, “The data obtained is not just promising; it’s the cornerstone upon which our future endeavours will be built,” said James Tworek, CEO of Element 79. “These recent results, coupled with historical data, represent the bedrock upon which we are advancing our Lucero project.”

Corporate Presentation.

From the PR: A total of 97 samples were sent for assays, 56 of which returned greater than 0.1 g/t gold (up to 8.55 g/t gold and 523 g/t silver. Several samples also were rich in base metals (up to 23.7% lead and 9.9% zinc), all of which underscores the richness of our project, further supporting the Company’s belief a robust resource base can be delineated. (Actual assay numbers are shown in the PR)

James C Tworek further states, “Element79 Gold has transformed from an asset amalgamator and seller to a near-term production story, responding to Peru’s government push for formalizing artisanal mining operations. We at Element79 Gold are thrilled to share our unwavering dedication to bringing our Lucero gold project in Peru into production. This past-producing, high-grade gold and silver mine holds immense potential to revitalize our Company and foster economic growth and prosperity in the region. “

The other ELEM property brings us back to North America. Nevada, to be precise. Reason to pay attention?  

Maverick Springs is adjacent to the Carlin Trend. For the uninitiated, the area contains several of the largest gold mines on Earth. The area includes a number of the largest gold mines on Earth. Maverick Springs is a blind deposit comprising a 30-120 metre thick, flat-lying zone centred on an anticlinal structure with oxidation pervasive to 120 metres and intermittent to 270 metres. (5)

West Whistler property is in the same area as Maverick, closer to the Battle Mountain Trend, alongside Carlin: Near several gold deposits, including the Cortez Mine, North America’s third largest gold mine with 2021 gold production of 828,000 ounces.

Finally, the Clover Property, 16 km west of the massive Hecla Mine in the Northern Nevada Rift. The property sits at the top and centre of the Carlin and Battle Mountain Trends.

Nevada Gold’s active Turquoise Ridge Mine, the third largest gold mine in the United States with 537,000 ounces of gold production reported in 2020, as well as the Twin Creeks open pit mines and the dormant Pinson and Getchell mines. 

Element 79 has drilling programs announced for the 2023/24 years and a more vigorous program for 2024/25.

As ( an aside, the gold price—and silver—have softened after particularly gold had a decent run. The first two in our group have slid a bit but seem to be holding in nicely.

If one follows gold forecasts, the pundits call for USD 2500-3000 over the next few years. The strategy is simple: A move to USD 3,000 represents a 50% appreciation. However, that also comes with physical and liquidity issues should you want to sell. 

And the Gold price?

On December 30, 2022, gold closed the year at $1,819.70 per ounce. Flash forward to one year later, and gold closed 2023 at $2,062.40. That’s a gain of 13.3% in a single year.  

With gold pushing to new record highs, it’s a fascinating time for gold investors.

Predicting the future of gold prices is never easy, but to offer some insights into what 2024 might hold, we’ve (compiled an array of gold price forecasts, outlooks, and predictions from renowned banks, industry experts, and financial analysts.

Let’s take a look.

 Analyst/Firm 2024 Gold Price Prediction
 Bank of America $2,400 by the end of 2024
 UBS Bank $2,200 by end of 2024
 Goldman Sachs $2,133 by the end of 2024
 World Bank $1,900 by end of 2024
 Citigroup $2,400 by the end of 2024
 ING $2,100 by the end of 2024
 Wells Fargo $2,100 – 2,200 by end of 2024
 Ronald Stoeferle, Incrementum AG $2,500 by the end of 2024
 Zach Scheidt, Rich Retirement Letter $3,000 by the end of 2024
Juerg Kiener, Swiss Asia Capital$2,500 – 4,000 by the end of 2024 So, we have looked at companies working in Rainy River Ontario, Nevada and Peru, each having its particular attraction for investors. And exceptional potential. And as a proxy for the gold market with arguably way more investment leverage than owning the physical. 

Numero Three

Off we go to South America. This time, Columbia with SOMA Gold. (TSXV: SOMA) (WKN: A2P4DU) (OTC: SMAGF) (the “Company” or “Soma“) recently announced that gold production for Q1 2024 was 7,335 AuEq ounces, an increase of 8% over the same period in 2023.

Let’s not get ahead of ourselves.

The Company owns two adjacent mining properties in Antioquia, Colombia, with a combined milling capacity of 675 tpd. (Permitted for 1,400 tpd). The El Bagre Mill is currently operating and producing. Internally generated funds are being used to finance a regional exploration program.

Soma is further ahead than our previous companies, which doesn’t make it better; it is just a different stage of development. 

Corporate Presentation2023 resultsTech Report.


Cardero Mine

  • The 84 thousand tonnes (kt) production rate in 2022 will ramp up to a peak mining production rate of 248 kt (680 tpd) in 2024. Achieving the planned peak production rate of 248 kt per annum would allow the Company to restart its previously operating El Limon Mill, with feed from Cordero in late 2023.
  • El Bagre Gold Mining Complex is located approximately 167 km northeast of Medellín in the Department of Antioquia, Colombia. Soma produced 23,115 ounces of gold at its El Bagre Mill in 2022, an increase of 30% from the previous year. Soma’s production forecast for 2023 is for a further 50% increase to 35,500 ounces of gold produced.
  • In addition to its operating El Bagre Mill, Soma owns the 225 tpd Limon Mill, which is located 47 km south of the El Bagre Mill. The Limon Mill has been on care and maintenance since 2020 but will be restarted when production from the Cordero Mine exceeds the capacity of the El Bagre Mill.
  • The Limon Mill operates similarly to the El Bagre Mill with two-stage crushing, ball milling, gravity concentration, flotation, cyanidation, Merrill Crowe precipitation, and smelting to produce doré. The mill was upgraded in 2017 to a capacity of 225 tpd and is permitted for up to 400 tpd.

As mentioned, these three companies are similar in that they have what appear to be skookum properties. They are also all great gold proxies, and they all trade for under CDN1.00. Cheekily, I may have said that investors can own all three companies for under CDN 2.00 a share. 

While I like the companies, I would buy them for their land positions. All have land that isn’t some dust pit but has either historical or proven assays. And most are near large producers. Element79; Nevada.Carlin Trend? Seriously?

Bob Beaty
+ posts

For over 30 years, Bob Beaty has been explaining concepts and companies to the global investment community. One of the original writers for Jim Cramer’s, he also wrote for AOL (Can/US), the Globe and Mail, and the Huffington Post. Over that period, he illuminated small-cap companies to investors with wit and pith but mostly opinion and facts. Investing should be fun. Pedantic, staid content is no fun.

Before embarking on his writing career, Bob had a successful international journey in the finance industry. He served as a broker, derivatives product manager, and a Director of London's Credit Suisse subsidiary. His career spanned across major financial hubs including Toronto, Vancouver, and the UK, giving him a unique global perspective. (He is still fondly remembering those English client lunches.)

Other than everything Groucho Marx and George Carlin ever said, Bob lives by a simple credo;

‘Never do anything the person standing in front of you can't understand.’ Hunter S. Thompson.

Let’s go.


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