As monetary policy continues down its destructive road of abundant money printing, its worth focusing on a topic that has drawn headlines the past five years that seems even more important today, which is peak gold. The rate of gold mine discoveries has significantly declined over the past three decades.
Among the new discoveries, there have been hardly any that experts call “world-class” deposits. These are typically large high-grade deposits with over 5 million ounces of gold reserves that can be turned into profitable mines capable of producing over 250,000 ounces of gold. The prospective impact of a lack of “world-class” discoveries on future gold production can be gauged from the fact that such mines account for nearly half of the global gold production today.
The average grade of the new gold deposits — the amount of gold that can be extracted per ton — has also been declining.
The average mine grade has fallen from over 10 grams per ton in the early 1970s to around 1.4 grams per ton today, according to Metals Focus, a precious metals consultancy.
With this endless monetary expansion through global quantitative easing, it becomes clear that new discoveries will become very important as demand for gold will be strong in the years to come as more and more fiat currencies become debased.
This turns our attention to Canada’s next major gold camp, the Fenelon Gold Camp:
The Big Players:
- Wallbridge Mining Co Ltd. (WM.TO):
- This is starting to have the potential of Canada’s next high-grade deposit and has a “Fosterville” feel to it with drill results seen at 47 g/t Au over 19.00 m and 22.73 g/t Au over 48.01 m, these are exceptional results! The ounces are going to add up very quickly!
- The company continues to impress with continuous drill results including the recently announced (March 23, 2020) 47 g/t Au over 10.15 meters in hole 19-1035-022, 6.09 g/t Au over 21.05 meters in hole 19-1035-025 as well as 17.33 g/t Au over 9.30 meters in hole 19-0985-013 among other strong intersections.
- Wallbridge drilled 75,000 meters on their project last year and has increased to complete 100,000 – 120,000m throughout 2020 on route to their maiden-resource calculation. There will be lots of catalysts through 2020!
- The consolidation of Balmoral by Wallbridge Mining (see Wallbridge Mining press release dated March 2, 2020) is expected to close shortly. This consolidation significantly increases Wallbridge’s presence along the Detour Gold Trend and adds the Martiniere Gold Deposit hosting 431,255 Ozs of Open-Pit Resources and 159,417 of Underground Resources. It is fair to assume this is only the start of consolidation in the area.
- Continuing on the “Fosterville” feel, it is not surprising to see Kirkland Lake owning 8% and Eric Sprott 20%. With the Fenlon Project being only 75km east of Kirkland’s Detour Mine, one can quickly see why this is of interest to both investors.
2. Probe Metals Inc (PRB.V):
- Probe holds a significant land position along the Detour Gold Trend; its holdings consist of 572 claims covering an area of 306 square kilometers. This is a discovery stage project but has some exciting prospects.
- In a March 16, 2020 update, the company stated: “Probe has been working in the area since 2016 and will be increasing its activity in 2020 as it evaluates its more than 75 kilometers of strike length along the Detour Gold Trend.”
- The company is well funded with cash and investments of $35M (April Corporate Presentation), so it will be interesting to see what catalysts come out of their experienced team.
3. Midland Exploration Inc. (MD.V):
- Midland has been very active over the past six months, increasing its land holdings along the Detour Gold Trend. “Since 2009, Midland has been one of the most aggressive mineral exploration companies to take a strategic position in the Detour belt and has built an impressive portfolio of seven (7) high-quality gold properties now totaling 1,491 claims (820 km2).”
- They had encouraging results on their Vortex Zone from their 2018 program, which yielded near-surface results of 38 g/t Au over 26.2m and 1.30 g/t Au over 23.5m among other impressive intercepts.
- The company is well funded with $13M in the treasury (April Corporate Deck). “Midland has postponed until next summer, a 1,500 meters drill program targeting the Vortex Gold Zone discovered in the fall of 2017.” However, Midland is known for putting together strong joint ventures and options, so further near-term catalysts are possible.
The Biggest Player:
Kirkland Lake Gold (KL.T):
- Kirkland Lake completed its’ acquisition of Detour Gold, giving the company a stronghold in the Detour Gold camp. The Detour Lake Mine is a monster producing 601,566 ounces in 2019 with a mine life of 22 years!
- Thinking big picture, one of the key things here is Kirkland’s 60,000 tons per day mega mill at the Detour Lake Mine with further “business improvement initiatives” planned for 2020. Imagine the margins and volume if one were to blend in some higher-grade ore into this mill, say from the Fenelon project. We know that Kirkland is no stranger to trucking ore as they truck ore 70km currently between their Taylor and Holt mines.
- $50 million in drilling and exploration is planned on the Detour Lake property in the first two years.
The New Players:
- Great Thunder Gold (GTG.V):
- On February 4, 2020, Great Thunder optioned the Northbound Gold Property, which is adjoined to the Fenelon Gold project’s north-west border and only 3.5Km from the Fenelon Deposit.
- Following this acquisition, Eric Sprott participated in a financing to bring his position in the company up to 4,000,000 shares (15.7% of shares outstanding). This is clearly a sign of the potential of Great Thunder’s assets in the Fenelon camp.
- On April 21, 2020, Great Thunder expanded its land position further by acquiring the Southern Star Property, adding +7,600 hectares to its prolific mining district. In the South-West section of the property, there was a historic silver intercept (SG3-1) along the Bapst Fault which yielded 5.6g/t Ag over 1.4m and 5g/t Ag over 1m. This silver intercept was targeted within an area of conductor anomalies and a VTEM target identified by Midland Exploration in 2017.
- There are two additional distinct electro-magnetic (“EM”) targets located on this property, and it covers 11km along the extension of the Lower Detour Fault. There has been little historical work to test these different targets on the property, yet.
- The company only has 25.66M shares outstanding with no warrant overhang and is fully funded. This has significant potential on any exploration success.
2. Goldseek Resources Inc. (GSK.C)
- On April 22, 2020 Goldseek Resources announced the acquisition of the Southern Arm Property just south-east of Great Thunder’s Southern Star Property. It shares a VTEM/EM target identified on the NW-SE Bapst Fault. The major anomalous zones are oriented NW-SE and have associations with the magnetic anomalies. According to the detailed resistivity depth imaging, the top of the EM response sources varies in depth from about 50m-500m deep.
- On Probe’s property located on Goldseek’s south border, there are strong grab samples and drill results as seen below:
- Eleven holes were drilled on the property from 1993 to 1995, mainly to test magnetic anomalies. Most of them intersected disseminated Au-Cu-Zn sulfides (pyrrhotite, chalcopyrite, pyrite) but returned low values of these metals. The property remains quite underexplored.
- The company only has 19.9M shares outstanding with little warrant overhang and is well structured for financing. This has significant potential on any exploration success.