It has been an interesting few weeks as inflation prints continue to run wild worldwide and countries in the east continue to stockpile gold.
Late last week, we learned German producer prices rose at their fastest annual pace in almost 60 years as the global energy crisis has specifically rippled throughout Europe very aggressively.
Plenty of uncertainty remains as the Nord Stream 2 pipeline certification was recently suspended by Germany, which would have brought natural gas from Russia to help ease the surging costs.
I expect the inflationary tailwinds in the energy market to continue adding pressure to general inflation in the months to come. Even coal is now trading at 12-year highs in the United States.
It is worth noting that coal piles at U.S utilities are at 24-year lows in addition to all coal miners in the United States are already entirely sold out in 2022.
This is all happening as gold finally broke its downward trend going back to August 2020 following the vast CPI print in October of 6.2%, and demand from retail coins to central banks adding more to their vaults around the world remains very strong.
New Placer Dome: (TSX-V: NGLD)
A story that I remain bullish on is New Placer Dome, which is focused on advancing its flagship asset, Kinsley Mountain.
The asset is situated in Nevada and 90km to the south of the producing Long Canyon gold mine that is part of the Barrick-Newmont JV.
The project is also on trend with the producing Bald Mountain gold mine operated by Kinross. Kinsley is a Carlin asset with a resource of 535k ounces indicated and inferred.
The Carlin Trend hosts more than 40 separate gold deposits, with 26 being built into producing mines.
The Carlin Trend is legendary due to the size of these deposits; to date, it has produced more than 84 million ounces of gold, and reserves still exceed 31 million ounces.
Long Canyon Gold Mine, Nevada
The high-grade historical drill results really caught my eye on Kinsley Mountain when I first learned about the project.
The 2020 program was a success as the Company tested three zones and made three new discoveries as the drilling program totalled 17,970 metres.
The three new discoveries were located at:
- Secret Spot
- 77 g/t gold over 25.3 metres in new surface oxide discovery
- 81 g/t gold over 11.6 metres; including 11.3 g/t gold over 2.9 metres
- Western Flank Extension
- 07 g/t gold over 4.6 metres
- 22 g/t gold over 6.1 metres
- The Main Pit North Oxide Targets
- 83 g/t gold over 7.6 metres high grade shallow oxide located 75 metres outside existing pit shell
The Company recently closed a $4.86 million-dollar financing, enabling management to keep pushing things forward at Kinsley. It has already identified three priority targets for this year’s expansion program.
2021/22 Kinsley Mountain Program:
- A massive 80km line expanded IP/resistivity geophysical surveys to cover the Secret Spot target and under-explored Kinsley North targets and over the main pit north past producing zone.
Drill testing of the Shale Saddle IP anomaly, shallow oxide gold targeted drill program around the new oxide gold step out discovery around the Main Pit North and drilling potential new Secret Canyon shale targets generated from the IP survey
I will be doing a deep dive on the Company in the coming weeks as it prepares to wrap up its geophysical survey before the expansion and discovery program commences and have also been invited to do a site visit following all the results of the IP survey and stand on top of a potential new Secret Canyon Shale Formation on another part of the property.
However, today I am pleased to be joined by the Company’s CEO & Founder, Maximilian Sali, for a general update on the Company:
Alexander Deluce:
Thanks, Max, for providing an update to the Gold Telegraph readers on New Placer Dome once again.
For new readers, can you provide an update on the Company and the exciting new discoveries at the Company’s flagship project, Kinsley Mountain?
Maximilian Sali:
The best update I can provide is that we just completed a financing for nearly $5m which was on the high end of the $4 to $5 million-dollar range and the book of investors, both long term supporters and new supporters is phenomenal. We really took our time to build a proper book with investors who are aligned with our goals on how to move the Company forward and the timeline to move Kinsley forward.
We had some big support from some of the biggest mining brokers in Canada and we also had support from insiders of Liberty Gold, both Cal Everett and Dr. Mark O’dea participated in the financing and Liberty Gold is now an insider of New Placer Dome owning over 15% of the Company.
In terms of exploration at Kinsley we are currently doing a massive IP survey over the resource and over the previously producing pit and up to the North to generate new targets and try to discover another Secret Canyon shale zone on a different part of the property.
When the Secret Canyon shale formation was discovered back in 2012 the Company at the time which had Kinsley went from a 25m market cap to as high as 250m market cap on that discovery and that’s what we are aiming to do again. We should be updating the market soon with some more results from the first 7 lines of IP that have been completed.
Alexander Deluce:
Since the last time we spoke, the Gold Telegraph readership has expanded considerably.
If you don’t mind, can you touch on Kinsley Mountain resource size and the valuation it demanded when it was with Liberty Gold?
Maximilian Sali:
The current resource at Kinsley is sitting around 535k ounces indicated and inferred and has not been updated to include any new results from our 2020 drill program.
Following another drill program in 2022 we will do a resource update. If we can make more new discoveries like we did last summer, adding ounces with those grades comes very quickly.
Alexander Deluce:
What are your current thoughts on the precious metals sector right now? Do you think we are getting close to our next leg up?
Maximilian Sali:
My thoughts on the mining sector right now in general is extremely bullish. I was fully invested into the lithium sector when I founded Advantage Lithium in 2016 and stuck with my positions through the down turn and now all those lithium juniors are either getting bought out or commanding huge market caps with some juniors now worth over $1b dollars.
It’s a sector I believed in and still do and being patient and buying those juniors has paid of big. I feel the exact same way about gold juniors and you can see it with my insider buying where I have backed the truck up on New Placer Dome as I think we are going into another big bull run for gold and with that means a re-rating for New Placer and its market cap, especially now that we are funded and ready to keep moving forward.
You and I have spoken about the price gold for a while and valuations and I know we both agree on most things and have laughed at the valuations of a lot of these good quality juniors but also taken that as a buying opportunity.
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