Auryn Begins World-Class Exploration on Seven Properties

Source: Bob Moriarty for Streetwise Reports   07/17/2017

Bob Moriarty of 321Gold explores the prospects of a company he believes is run by a “dream team” that has assembled a stable of world-class projects.

Over the past eighteen years, since the low of gold at $252 in August of 1999, management teams in the junior resource industry have had all the opportunity in the world to prove their competence. Or lack thereof. For the first time in history, probably driven by demand for everything from China, every commodity was in shortage and exploded higher. I’ve never heard of that before.

Companies with good technical teams and smart management all hit home runs in the past fifteen years. But, as in baseball, there were a few home runs and a lot more strikeouts or whiffed catches.

Keegan Resources in Ghana proved to be a home run, going from $0.49 to $9+ with 10 million ounces of gold. The same management and technical team went from success in Africa to advancing a major gold district in Mexico when you couldn’t give gold away from 2011 until 2015. When I went to see them four years ago the stock was $0.67 and the company got no attention. My only disagreement with them was that they were underestimating the size of the project. In my eyes it was a lot bigger than they thought. Now they agree I got it right.

That brilliant technical and management team sold the company a year later in the depths of a dismal market for $3.67 a share to Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE). Those who held onto the shares saw the price go to $6.50 a share; a 900% increase while everyone else was declining up to 99%.

The team is back. Now they are thinking really, really big. Auryn Resources Inc. (AUG:TSX: AUG:NYSE) owns seven major exploration properties at various stages. The only requirement was the project had to be high grade, oxide gold or have district scale. All three would be even better.

I am no more a fan of big resource companies than I am of big government. The further either gets away from the people on the ground, the dumber the decisions become.

However, for a young geologist, working for a large and stupid mining company may be a great way to begin a career. Large companies have large staffs spread across a variety of specialties. Learning what tools are available can be handy for the neophyte employee.

Auryn management proved to be in sync with the overall gold market. They picked up their prime Committee Bay deposit with a high-grade resource of just under 1 million ounces of gold in late September of 2015, only three months before the low and start of the rocket ship higher in gold prices. They paid a tiny $18.4 million. The district scale (think Boston-New York in distance) property carries a 1% NSR.

But while they were scarfing up major prime gold projects for pennies on the dollar during the downturn, they also raided Newmont Mining Corp. (NEM:NYSE). The company assembled a team of eight experts in their own fields of geology. Within the group, they have participated in the discovery and exploitation of some of the largest gold projects in the world.

Auryn has built Committee Bay up to about 1.2 million ounces at 7.5 g/t gold. The project had had over $100 million spent on it during the last twenty years with over sixty-five individual discoveries. Auryn just began a world-class, 25,000-meter drill program on the property. Look for results to be coming out for months, and perhaps years. Twelve targets are being shot at. All have seen prior work.

Agnico Eagle, the company that bought Cayden Resources three years ago, is operating at the southern end of the belt that contains Committee Bay. They have defined seven million ounces of gold and the number is still growing. Each of the dozen targets of Auryn at Committee Bay has the same potential.

Also located in Nunavut is Auryn’s Gibson MacQuoid gold project, in a 75-mile long greenstone belt. With previous high-grade showings at surface, Auryn is planning a summer long surface sampling study to determine high potential drill targets.

At Homestake Ridge in British Columbia, Auryn begins a 15,000-meter drill program this month. The property has an identified 1 million ounces of gold at 9 g/t. Previous drilling has shown intercepts of as high as 73 meters of 21 g/t gold. They hope to double that resource with this year’s program.

Down south in Peru, Auryn has a stable of four major projects in their portfolio designed by one of the discovery team that found Yanaccocha with +60 million ounces of gold. In 2017 they plan on drilling as many of the projects as they can. Some are drill ready but some need surface work prior to drilling. Their most advanced and drill-ready property is the Huilacollo gold project, which already has a non-NI-43-101 historic resource of about 150,000 ounces of gold.

Drilling will begin in October in Peru. This year’s budget calls for 15,000 meters of drilling spread among the four projects in Peru.

In short, the Auryn team has put together a dream team on the technical side and a dream team of projects with world-class potential. They have the money in the bank to begin a world-class drill program. I think they are going to hit something somewhere or maybe hit something everywhere.

In a brilliant stroke of genius, the company applied for and got a New York Stock Exchange listing. They will now trade in New York under the same AUG symbol. That is far more than just symbolic. You see, stockbrokers in the U.S. are not allowed to recommend or trade the penny dreadfuls.

By listing in the U.S. and having a share price above $3 Auryn has opened up an entire world of new investors. They are perfect positioned to ride the wave of investing higher as gold goes up.

Auryn is an advertiser. Do your own due diligence.

Auryn Resources
AUG-T $3.05 (July 17, 2017)
AUG-NYSE 76.9 million shares
Auryn Resources website

Bob and Barb Moriarty brought 321gold.com to the Internet almost 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

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Disclosure:
1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. Auryn Resources is an advertiser on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

( Companies Mentioned: AUG:TSX; AUG:NYSE,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17565

Gold: Cheaper Than Buying Greek Villas in 2012

Source: Tom Beck for Streetwise Reports   07/16/2017

Tom Beck, founder of Portfolio Wealth Global, delves into the factors that drives gold investment demand.

Gold prices peaked in 2011 at a price of $1,925 per ounce, and since then, it has plummeted.

The bottom was set in 2015 when gold was hated and disregarded by investors—it was trading for $1,099.

20-Year Gold Price in USD

Portfolio Wealth Global has spent hundreds of hours speaking with world-class mining speculators, and what has become most clear to our members by now is that when this sector becomes ugly, distressed and disgusting, it also becomes awfully cheap and attractive—these attributes go hand-in-hand. That’s the gold playbook for massive profits.

I personally own precious metals because it’s the sensible thing to do. I also own some cryptocurrencies, as a speculation into the future of payment systems.

With the national debts of all modern nations, from Australia to Japan, the entire continent of Europe, Canada, and the granddaddy of all debtor nations, my native U.S. of A. ballooning into the tens of trillions, it’s not even an option to have only fiat digits in your asset portfolio—safe havens must also be accumulated.

In 2008, when I started accumulating my “survival portfolio,” the clear-cut mentality of mining fortunes was revealed to me in the investment conference I attended. It was 2009, and Canadians were seeing a blood in the streets moment.

HUI Index and Bear Market Cycles

This is not a sector in which you sit back and forget about your portfolio for a few years.

Instead, it’s governed by wild rotations of hyper-valuations and bargain valuations.

Where are we now, overvalued or undervalued?

In late 2015, we were at the historical low point for mining shares. Yes, if you want to be filthy rich with commodities, the real money is in owning the companies and businesses that explore, rarely discover, even more rarely develop, and extremely rarely produce the minerals our world requires to function at a profit.

This could be anything of importance: iron ore, oil, natural gas, copper, aluminum, palladium, zinc, cobalt, uranium, or silver and gold.

Since only producers are cash-flowing, the rest of the mining universe is speculative. As a result, investors bid their prices up and down with no real measure of worth.

That’s the whole secret to succeeding and adding zeroes to our bank accounts in precious metals: wait patiently for markets to be absurdly cheap, even filled with bankruptcies, and then step in to gobble up the leftovers at ultra-low price points.

Sell when the market seems loved again.

What Drives Gold Investment Demand?

Gold is a very unique metal. In contrast with all other base and precious metals, its utility isn’t commercial, so it’s not consumed.

Instead, it is either worn as jewelry or stored in vaults.

All the gold that’s ever been mined is still above ground. This is in complete contrast to silver, for example, whose industrial uses are varied and above-ground inventory is low.

Gold is unique because it has specific attributes that give it superiority to function as money. In fact, it is the ultimate form of money—the core of the monetary universe.

Nothing can replace it as the No. 1 form of commodity-based money, and no resource ever will. Along with silver, these two precious metals have helped drive commerce for nearly 5,000 years. In times of economic uncertainty, as our current abstract currency system cracks and show its fragility, the premium and the price investors, savers, and governments are willing to pay for it is without limits.

As investment demand grows, the price heads higher. Remember that in the past 20 years, there have been very few new discoveries, yet production is going full steam ahead. This means we are depleting known reserves without discovering new ones. Those are classic supply and demand economics, which will keep the metal priced even higher.

Peak Production

So long as interest rates remain close to zero, the missing piece of the gold rally puzzle is rising inflation levels, which might just be on the horizon, potentially leading to the end of the 8-year broad index bull market.

Since I realized the grave danger of the economic system we live under, my life’s work has been devoted to helping people detach themselves from mainstream stupidity and follow unconventional wisdom—the only kind that actually brings positive outcomes.

Tom Beck is the founder of Portfolio Wealth Global. Known as one of the first millennial millionaires in the United States, Beck is a relentless idea machine. After retiring two years ago at age 33, he’s officially come out of retirement to head up Portfolio Wealth Global. He brings a vision of setting a new record for millionaires with his seven-year plan to accelerate any subscribers’ net worth who will commit to the income lifestyle. Beck delivers new ideas on the marketplace that were once only available to the rich. Traveling the world, he’s invested in over a dozen countries, including real estate.

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Disclosures:
1) Statements and opinions expressed are the opinions of Tom Beck and not of Streetwise Reports or its officers. Tom Beck is wholly responsible for the validity of the statements. Streetwise Reports was not involved in the content preparation. Tom Beck was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

Charts provided by Portfolio Wealth Global

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17564

The Biggest Opportunity in Precious Metals Since Late 2015, and the Last Chance at These Prices

Source: Clive Maund for Streetwise Reports   07/15/2017

Technical analyst Clive Maund’s analysis of the charts is indicating that gold and silver are positioning for a big move upward.

We’ve had to wait 18 months for an opportunity as big as the one we saw late in 2015 to appear again in the Precious Metals sector. “Wait a minute,” I hear you say, “prices were generally lower back then at that low than they are now, so how can it be as big an opportunity, as leverage is reduced?” Here are the reasons, one technical, the other fundamental. When prices rose out of the late 2015 low, which was the Head of the Head-and-Shoulders bottom shown to advantage on the 10-year chart for GDX (VanEck Vectors Gold Miners ETF) below, they were destined to retrace to mark out the Right Shoulder of the pattern, which is what now has most investors very negative towards the sector again.

This time they don’t have to—they can now rise out of this trough and proceed to break out upside from the entire pattern to embark on a mighty bull market. The fundamental reason is this: most investors have been taken in by the specious central bank talk about “normalizing interest rates” and scaling back their bloated balance sheets, but they haven’t got a cat in hell’s chance of doing this. Why? Because debt (and associated derivatives) has expanded to such gargantuan levels that any attempt to bring it under control will send interest rates skyrocketing. Because of this stark reality, they are left with only one option: to inflate the debt away by monetizing it, which means inflation. Once investors grasp the inevitability of this—and that this process will soon get underway with a vengeance—gold and silver will soar. That is what the charts that we are going to look at today are telling us, and it means that we may never see the bargains in the Precious Metals sector that are now available ever again—or at least not for a very long time.

The latest COTs are telling us that gold and silver have hit bottom, or are very close to having done so, and that the time to buy the sector is now. Before proceeding to look at them we will start by looking at the latest 10-year chart for GDX, a reliable PM stocks proxy, to see where we are on the market clock, where we are in the PM stock price cycle.

Our 10-year arithmetic chart for GDX shows a clear large Head-and-Shoulders bottom forming, with the price now in the process of completing the Right Shoulder trough of the pattern. Obviously, most would be investors in this sector either don’t know this pattern exists, or if they are aware of it, have written it off as a false H&S bottom, witness the rotten sentiment towards the sector, which is just what we want to see at this juncture. Indications that the pattern is genuine are provided by the strong volume on the rise out of the trough of the Head of the pattern, which we can expect to see again on the rise out of the Right Shoulder trough soon, and the outstandingly bullish COTs, which we will soon look at.

The rotten sentiment towards the PM sector is amply illustrated by the latest Gold Miners Bullish Percent Index chart. At just under 18% bullish, it is a little above the levels seen before the sector rally early this year, and at about the same level seen before the big rally during the 1st half of 2016. This clearly point to a sizeable advance by the sector soon.

Next we look at a 3-year chart for gold. At first sight this does not look very encouraging as it looks like there is room for gold to fall further to last December’s low, or further down to the December 2015 low, but of course, if gold is marking out a Head-and-Shoulders bottom in the manner of GDX, which it is, as can be seen on its 10-year chart in the last Gold Market update, then we would expect it to turn up from around where it is now. Now we will look at the latest COT to see why it is likely to.

On gold’s latest COT chart we can see how Large Spec long positions have shrunk dramatically over the past six weeks to a low level, and since the Large Specs are habitually wrong, this was almost a necessary prerequisite to a strong advance. The question we want to answer is “Have they dropped back enough now to lead to a reversal and the start of a major new uptrend?” The answer to that is yes, they probably have. For one thing, silver’s COT readings have already dropped back to their levels at the low of December 2015, which provides circumstantial evidence that gold’s readings do not need to drop back any further. Second, we would not expect gold’s COT readings at the Right Shoulder low to drop back as low as they were at the low of the Head of the pattern, because that was the low for the cycle and the end of the bear market. Current readings are, therefore, thought to be low enough to synchronize with a reversal.

Nevertheless it is worth looking at the old gold COT chart for the period around the December 2015 low, which shows a rare and remarkable circumstance where Commercial short and Large Spec long positions had dropped back almost to zero—it doesn’t get more bullish than that for gold. While they may not be at zero now, they are getting close, close enough considering where we are in the cycle.

Now we turn to silver, where we will see that despite weaker price action recently, COTs are even more bullish than those for gold. While silver looks considerably weaker than gold, as it has dropped back close to its December 2015 lows, which gold hasn’t (it is still quite some way above them), we should remember that it is normal for silver to underperform gold in the late stages of bear markets and early stages of bull markets. As we observed in the last Silver Market update, the spike down about a week ago on high volume looks like a final “capitulation.”

The latest silver COT chart reveals that Commercial short and Large Spec long positions have shrunk steadily in recent weeks back to levels that are now very low indeed. In fact they are at the same levels as in December 15, as you will see by looking at the earlier COT chart stacked beneath the latest one below—and we know what happened after that—there was a blistering PM sector stock rally that saw some stocks make huge percentage gains, like Coeur d’Alene (now named Coeur Mining Inc.), which rose more than 8-fold. Of course, we won’t see such big percentage gains this time round, at least not immediately, as we will be coming off a higher base, but we ought to later because the PM stocks sector indices should proceed to break out of the top of their respective Head-and-Shoulders bottom patterns to enter a major bullmarket growth phase.

Finally we will take a quick look at the latest Silver Optix, or optimism chart, where we see that investors are at their most pessimistic towards the metal since the bottom of the bear market in 2015, just before a big sector rally. This obviously augurs well for the sector since the majority are always wrong.

With this gigantic opportunity staring us in the face, we will obviously be looking at a range of attractive Precious Metals stocks on the site very soon.

Clive Maund has been president of http://www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years’ experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

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Disclosure:
1) Statements and opinions expressed are the opinions of Clive Maund and not of Streetwise Reports or its officers. Clive Maund is wholly responsible for the validity of the statements. Streetwise Reports was not involved in the content preparation. Clive Maund was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

Charts courtesy of Clive Maund.

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17561

Is this Gold-Silver Royalty Company Poised to Rally?

Source: Peter Epstein for Streetwise Reports   07/14/2017

Peter Epstein of Epstein Research explains why he believes the pieces are falling into place for this royalty and streaming company.

I’ve written two articles [May 5] / [June 19] about an emerging precious metals Royalty/Streaming (R/S) company in the past two months. I figured that would have been enough until August, especially after the “flash crash” that sent silver briefly to US$ 15.21/oz. on July 7th. So why am I revisiting Metalla Royalty & Streaming Ltd. (MTS:CSA; NASDAQ:EXCFF) again so soon? First, I was reminded by several readers that an important catalyst for the company is its listing on the TSX Venture Exchange, within two months. I hereby restate that event as not just an important catalyst, but a near-term catalyst.

While some might not think of two months as near-term, it is for those smart enough to buy shares BEFORE the up-listing. The average daily trading volume after the Coeur Mining deal was announced through the end of June has been ~120,000 shares. It would not take a hell of a lot of buying to return the share price to the $0.60’s {at $0.52 on July 10th}.

Second, valuation as measured by a cash flow multiple is cheap compared to precious metal R/S peers. However, several peers are giants like Franco-Nevada Corp. (FNV:TSX; FNV:NYSE), Wheaton Precious Metals Corp. (WPM:TSX; WPM:NYSE) and Royal Gold Inc. (RGLD:NASDAQ; RGL:TSX), prompting some to question the wisdom in using majors as comps. Point taken. Metalla Royalty is not directly comparable to the largest players, but as it grows through acquisitions like the US$13M deal with Coeur Mining Inc. (CDE:NYSE), it will become attractive to a larger universe of investors, including a range of U.S. and Canadian investment funds. The TSX-V listing is expected soon after the closing of the Coeur transaction. {See July Corporate Presentation}

Third, initiation of a quarterly cash dividend, which I thought was next year’s business, could potentially be announced in the 4th quarter. I’m guessing it would start out small, with room to grow. Even a half penny quarterly dividend, (2.0 cents/yr.) would be a 3.85% yield, and only a 26% payout ratio (assuming 71 M shares outstanding and C$5-6 M in annual run-rate cash flow).

Metalla

Fourth, since May 31st, a large short Interest has developed in Metalla, from a modest 47,500 shares to 1,090,000 shares on 6/30/17. Yet the share price in June was actually up from $0.51 to $0.53. There was modest insider buying and no insider selling in the month and modest insider buying continues in July. I believe a perfect storm could be brewing for summer’s end, when the Coeur transaction closes and the TSX-V listing is secured. If a dividend is announced, that too could lead to buying and would add to the holding cost of being short the shares. I think there will be strong buying interest once MTA is on the TSX-V, because I’m told there are a number of institutional accounts on the sidelines waiting for the up-listing.

Fifth, management expects to announce at least one, and possibly two, additional acquisitions by year-end. This could potentially boost annual CF from about C$5-6 M to C$8 M+, a tremendous start for an up and coming R/S company!

Metalla Royalty & Streaming holds great promise as an emerging R/S company. 2018 could be a breakout year for the company in terms of cash flow growth, asset diversification, leveraging the portfolio platform and name recognition. The Coeur Mining transaction is already opening doors; it has put Metalla on the map.

As exciting as the story is, readers are reminded that this is a high-risk, small-cap company. Closing the Coeur transaction and obtaining the TSX-V listing are risk factors worth watching this summer. Metalla’s low EV/CF ratio (about 6-7:1) is an indicator of a cheap valuation, but there’s no guarantee that the ratio will soon converge with that of peer companies like AuRico Metals Inc. (AMI:TSX; ARCTF:NASDAQ) and Maverix Metals Inc. (MMX:TSX.V; MACIF:NASDAQ) (with EV/CF ratios of ~12-14:1). The company’s short operating history as a R/S company might give some investors pause, but therein lies the opportunity as well, to pick up shares before investors catch on that Metalla is the real deal.

Metalla

I believe that over the next several quarters, Metalla’s absolute and relative valuation to industry peers will improve. It won’t happen overnight, but it needn’t take year(s) either. That’s assuming management continues to execute well.

Everything is falling into place, i) gold & silver prices are fairly weak, enabling the company to strike more favorable deals in the near-to-intermediate term, locking in leverage to longer-term uptick in prices ii) Metalla has millions of dollars in loss carry forwards from the previous shell company that will help shield it from cash taxes, iii) management has a full pipeline of transactions for review, iv) upon close of Coeur transaction, the company is already meaningfully de-risked [will be robustly cash flow positive].

That means that in coming years cash flow growth could be much, much higher than peers, with operating margins the same or better. How long will Metalla Royalty’s EV/CF ratio remain at 1/2 to 1/4 that of peers? Its P/NAV ratio well under 1.0 to 1 vs. [1.5 – 3.0] to 1 among industry players?

Who knows if or when these valuation gaps might close, but for those with the stomach for high risk, it might be wise to begin investing in this opportunity sooner rather than later.

Peter Epstein is the founder of Epstein Research. His background is in company and financial analysis, and he is a Chartered Financial Analyst (CFA). He holds an MBA degree in financial analysis from New York University’s Stern School of Business.

Peter Epstein Disclosures: The content of this article is for illustrative and informational purposes only. Readers fully understand and agree that nothing contained herein, written by Peter Epstein of Epstein Research, [ER] including but not limited to, commentary, opinions, views, assumptions, reported facts, estimates, calculations, etc. is to be considered implicit or explicit, investment advice. Further, nothing contained herein is a recommendation or solicitation to buy or sell any security. Mr. Epstein and [ER] are not responsible for investment actions taken by the reader. Mr. Epstein and [ER] have never been, and are not currently, a registered or licensed financial advisor or broker/dealer, investment advisor, stockbroker, trader, money manager, compliance or legal officer, and do not perform market making activities. Mr. Epstein and [ER] are not directly employed by any company, group, organization, party or person. Readers understand and agree that investments in small cap stocks can result in a 100% loss of invested funds. It is assumed and agreed upon by readers that they consult with their own licensed or registered financial advisors before making investment decisions.

At the time this article was posted, Peter Epstein owned shares in Metalla Royalty and the Company was an advertiser on [ER]. By virtue of Mr. Epstein’s share ownership and the Company being an advertiser on [ER], Peter Epstein should be viewed as biased in his views on the Company. Readers understand and agree that they must conduct their own research, above and beyond reading this article. While the author believes he’s diligent in screening out companies that are unattractive investment opportunities, he cannot guarantee that his efforts will (or have been) successful. Mr. Epstein & [ER] are not responsible for any perceived, or actual, errors including, but not limited to, commentary, opinions, views, assumptions, reported facts & financial calculations, or for the completeness of this article. Mr. Epstein & [ER] are not expected or required to subsequently follow or cover events & news, or write about any particular company or topic. Mr. Epstein and [ER] are not experts in any company, industry sector or investment topic.

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Streetwise Reports Disclosure:
1) The following companies mentioned in the article are billboard sponsors of Streetwise Reports: Wheaton Precious Metals Corp. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
2) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
3) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this interview, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Metalla Royalty & Streaming Ltd., a company mentioned in this article.

Charts provided by author

( Companies Mentioned: MTS:CSA; NASDAQ:EXCFF,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17560

Has Novo Discovered the Wits West?

Source: Bob Moriarty for Streetwise Reports   07/13/2017

Bob Moriarty of 321 Gold discusses the potential for Novo Resources to have a Witwatersrand-style deposit and the recent run-up in the explorer’s stock.

Novo Resources Corp. (NVO:TSX.V; NSRPF:OTCQX) put out a press release on July 12th that lit the stock on fire with the stock up 55.2% with 1.7 million shares trading and the price up to $1.49, up $.53 on the day. The press release was interesting in that for the first time to my knowledge the TSX has allowed a YouTube video to be attached to a press release.

The first video shows someone using a metal detector to find the signal of a nugget in the first test pit and the second shows someone using an air chisel to actually pry out a rock containing several gold nuggets.

It’s funny that the stock goes up 55% just now because Novo press releases have been talking about the style of mineralization and people using metal detectors to find gold since May 26, 2017. The company’s web page discussing the style of gold and showing samples of nuggets in rock and a close up picture of the gold has been up for a month without anyone taking notice.

I don’t pay much attention to bulletin boards but a poster named TexasT has been posting on the Novo Resources Stockhouse Bullboard since June 12, 2017, talking about how rich is Comet Well and the area that Novo did a deal on in May. He says that he was the first person to find gold at Comet Well, which is part of the Karratha package. I don’t have any idea of who he is but he’s been saying for weeks that the area is loaded with gold and he thinks Novo is on to a giant find.

I first wrote up Novo Resources in August of 2012 calling it a Wits system. Well, it is and 24 years after Quinton Hennigh first came up with the theory about how gold got into the Wits Basin while he was still a doctoral candidate at the Colorado School of Mines. At the time I wrote my piece five years ago Novo only controlled 698 square miles of a potential Wits system.

In their press release of June 26th, Novo went on to say they now control 9,228 square km in the Karratha region. For those more comfortable with miles, that is 3562 square miles. And they went on to again point out that people were using metal detectors to find nuggets in the area. So while I find the video posted showing use of a metal detector to find gold on the project very interesting, it’s hardly news.

Novo has begun to do trenching. It’s going to be a real bugger to get accurate grades due to the nugget effect. Given that the nugget found by the metal detector and pried out of the ground on the video is almost an inch in length it is going to skew any assay results if it is left in or if it is left out. The only way to determine true grade of this project is going to be either average a hundred random samples that represent the real distribution or to mine it.

Quinton is going to try to do something simply brilliant. In a system like this loaded with nuggets, finding true grade is difficult due to the small amount of material to be sampled. If you drill through a nugget with an ordinary core drill you get really high grade. If you miss the nuggets, you get low grades. In either case, you don’t have enough rock to sample.

Quinton is bringing in a 16-inch water well drill. It will be picking up 500 kilo samples every meter or so. The sample will still have to be split and that will induce error but with enough assays, his team will have a pretty good idea of grade.

I was aware of the metal detecting and lots of nuggets going back to when the deal was done in May. I didn’t want to write a piece until I actually had my boots on the ground and could verify what I was being told. Alas that trip wasn’t going to happen until August and the market woke up first to the information that has been around for months.

No one will even guess what the grade might be. You simply can’t, there isn’t enough information. And it’s also not possible to speculate as to the size of the area of mineralization. That will come through drilling. But here is what we do know. For the first time, we have had actual paleo-placer. There was free gold in the conglomerates at Beaton’s Creek but it wasn’t placer, it was free gold found in a stacked series of conglomerate beds just as Quinton predicted in 1994. These gold nuggets found in Karratha are free gold but have probably been remobilized through bacterial action into true nuggets.

Those nuggets littered the edge of the basin for a long time and were reworked by the tidal flow. When Novo has gotten a tiny sliver of an idea of grade, they have no idea at all of distribution. The gold sequence most closely resembles the beaches and offshore at Nome Alaska.

Where this deposit gets really interesting from a unique point of view is that the gold has been cooked. Yes, that’s exactly what I mean, the gold was cooked. Here’s what I think has happened.

  1. Some 2.5-3.5 billion years ago gold is dissolved in a very caustic solution of seawater that has the ability to contain between 1,000 and 10,000 times as much gold as salt water today.
  2. Single cell cyanobacteria began life about 3.5 billion years ago and produced oxygen as a byproduct.
  3. Iron dissolved in seawater literally rusted out as the oxygen content of the water increased and produced banded iron formations.
  4. As the chemistry of the salt water changed, after the iron precipitated out of solution, the gold began to precipitate out as well in shallow conglomerate beds near the edge of the basin it was in. Since gold has an affinity for carbon, in both the Wits East and Beaton’s Creek in the Wits West, gold is often found at or near carbon. When Quinton showed me a blob of carbon next to some free gold at my first visit to the Pilbara in August of 2009, I became a believer.
  5. At least with the gold nuggets found recently in the Karratha property I suspect the free gold that came out of solution as the oxygen content of the water increased banded together through bacterial action and formed lumps of gold that was then washed back and forth with the tidal action producing the common watermelon seed gold nuggets.
  6. A hot intrusive covered the nugget containing conglomerate beds and literally cooked the gold. To the very best of my knowledge, this is unique. Certainly I have never heard of it before. That’s meaningless from a mining or technical point of view but really interesting.

Moriarty with carbon blob

Gold nugget

It is my belief that Quinton Hennigh has proved his theory of how gold got to the Witwatersrand and to the Pilbara basin. But I also believed that just based on my first trip in 2009 to the area. Certainly he recognized at once the potential when he learned of the Karratha gold discoveries made by prospectors using metal detectors. The Karratha gold is uniquely different from the Beaton’s Creek gold but found in stacked conglomerate beds and is 100% compatible with his theory. Beaton’s Creek certainly has enough gold for a gold mine but the Karratha conglomerates have game changing potential.

There are two major questions.

  1. What is the grade of the deposit? We aren’t going to know this until we have a lot of results from trench samples and bulk samples from the water well drill unit. We need dozens of assay results before coming up with a reasonable guess. I would be very interested in knowing the exact composition of the gold from Beaton’s Creek, Karratha and the Wits. Are they similar or how are they different?
  2. What is the extent of the project? If this is a Nome analog, there may well be miles of mineralization.

When I wrote my first piece about Novo in 2012 the company had about 31 million shares and was selling for $0.45 a share. I said, “It is easily a ten-bagger. It could be a 100-bagger. It’s going to be big. What’s the value of 700 square miles of the Wits?”

The company was on the C-Exchange and finally moved to the TSX-V. That was a giant improvement and allowed for far better liquidity. But they also ran the number of shares from 31 million to over 150 million fully diluted to raise money for exploration and land acquisition. I hated the dilution but understand why they did it.

We are at the “Interesting” stage. No one can predict either grade or size based on what we know today. We do know Quinton has picked up a giant land position. Certainly if the deposit has legs, Novo will benefit. I have loyal readers who have stuck with 321gold and Novo for the last five years because they believed in Quinton Hennigh.

With good results my predictions may well end up correct. For current investors sitting on your hands may be the most profitable action you can take. I cannot even suggest if buying or selling at today’s price makes sense. It’s not my money so the investor should make that decision.

I have been an investor since Novo was Novo. I still believe Roo Gold is a far better name but who am I to suggest a name change? Novo Resources is an advertiser.

Only you have responsibility for your own due diligence and decisions.

Novo Resources
NVO-V $1.49 (July 12, 2017)
NSRPF OTCQX 116.6 million shares
Novo Resources website

Bob and Barb Moriarty brought 321gold.com to the Internet almost 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

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Disclosure:
1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Novo Resources. Novo Resources is an advertiser on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Photos courtesy of Bob Moriarty.

( Companies Mentioned: NVO:TSX.V; NSRPF:OTCQX,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17558

The Bubble in Financial Assets Continues

Source: Rudi Fronk and Jim Anthony for Streetwise Reports   07/13/2017

Rudi Fronk and Jim Anthony explore the connection between market bubbles and the price of gold.

We thought that when the gold price broke above its five-year downtrend in early June, it would establish an upward trend. We were wrong. Another false start, it seems. The bubble in financial assets continues.

We think understanding bubbles is the key to discerning the big moves in the gold price. The west has documented seven financial manias or bubbles in the last 250 years. These bubbles peaked and then collapsed in 1720, 1772, 1825, 1873, 1929, 2000 and 2008. In every case, gold performed relatively less well in the expansion years of the bubble and outperformed every other asset class in real terms in the contraction phase.

In the recent manias, we also know that gold stocks substantially outperform gold during the contraction phase because operating costs fall.

Let’s look at the recent examples. In 2001, the dot.com mania collapsed and gold soared to new highs. In 2008 a bubble in housing led to a collapse of the financial system and once again gold took off to new highs. In 2012, the Fed succeeded in creating yet another bubble in stocks and bonds after dropping rates to zero and flooding the system with liquidity via an alphabet of programs, chief among them QE (quantitative easing). Gold performance has since fallen well behind stocks and bonds in the expansion phase of the current mania.

As we have often noted, gold is the ultimate risk-averse protector of wealth. And bubbles are the ultimate expression of risk-taking. Risk–taking is still the order of the day.

What’s a bubble?

Bubbles are periods of widespread high-risk investor behavior marked by extreme valuations and extremely bullish sentiment unsupported by economic facts, ending in a crash. Bubbles have three necessary components:

1) A credit boom: Investors use large amounts of leverage to enhance returns. Investors reach for yield. Debt substantially increases risk. The results is forced liquidation and a liquidity panic when markets fall.

2) A narrative: The extreme valuations are explained by a narrative that says “this time is different.” The dot.com bubble was supported by the expectation that Internet technology would drive a New Economy of faster growth, amazing productivity gains and higher profits. The housing bubble was supported by the supposed fact that housing prices could not fall, that a national housing bubble was not possible and that a new paradigm of risk-reducing, AAA-ranked MBS could virtually eliminate risk. Today’s everything/everywhere bubble is supported by the supposed ability of central banks to manage their economies and mitigate financial system risks by keeping interest rates very low and liquidity very high.

3) Time: The third element is a long period of growth, with no recessions, low market volatility and accommodative monetary policy. Hyman Minsky noted in his Stability Hypothesis that the longer the period of economic and financial stability, the greater the resulting instability. Recessions especially clear the system of unproductive debt and the deleveraging reduces risk. Otherwise, Hedged Finance (in which debt is backed by a growing ability to repay) is followed by Speculative Finance (in which debt must be rolled over but the interest is covered by earnings) to Ponzi Finance (in which the interest is paid from fresh borrowings). That’s why bubbles always occur near the end of long economic expansions, when the economy is already slowing down but risk-taking is at its peak.

The key question to be asked now by investors is whether or not financial markets are truly in a bubble or just a wild bull market. These alternatives reward very different strategies. We will provide our view in the next installment.

This article is the collaboration of Rudi Fronk and Jim Anthony, cofounders of Seabridge Gold, and reflects the thinking that has helped make them successful gold investors. Rudi is the current Chairman and CEO of Seabridge and Jim is one of its largest shareholders. The authors are not registered or accredited as investment advisors. Information contained herein has been obtained from sources believed reliable but is not necessarily complete and accuracy is not guaranteed. Any securities mentioned on this site are not to be construed as investment or trading recommendations specifically for you. You must consult your own advisor for investment or trading advice. This article is for informational purposes only.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosures:
1) Statements and opinions expressed are the opinions of Rudi Fronk and Jim Anthony and not of Streetwise Reports or its officers. The authors are wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the content preparation. The authors were not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the authors to publish or syndicate this article.
2) Seabridge Gold is a billboard sponsor of Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17559

Steady Progress Pushes Canadian Explorer to Dig Deeper and Expand in Mexico

Source: Streetwise Reports   07/13/2017

An updated resource estimate and PEA in Q3/17 by a large exploration company will include plans for expansion after steady progress and a recent high-grade discovery at its Mexico project.

Progress and steady results has been the mantra for MAG Silver Corp.’s (MAG:TSX; MAG:NYSE.MKT) “world class silver-gold-lead-zinc” JV Juanicipio project (56% owned by Fresnillo Plc) in Mexico, according to Canaccord Genuity analyst Kevin MacKenzie. In a recent report, Mackenzie looked back at the history of the Juanicipio project, explaining that over the last two to three years the underground exploration has made steady advances leading to the discovery of the high-grade Dilatant Zone. Due to this discovery, “the joint venture is now contemplating expanding the project’s designed throughput to 4,000tpd (previously 2,650tpd), as well as sinking an internal shaft to allow for earlier access to wider zones of mineralization at depth,” MacKenzie wrote.

Mackenzie pointed out that the updated technical PEA will most likely “capture the impact of the materially larger resource base” and include costing similar to the Saucito Mine owned by Fresnillo Plc (FRES:LSE). Viewing MAG Silver “to be one of the premier investments within the silver developer space,” MacKenzie noted that another near-term rerating may be necessary due to “the potential discovery of another high-grade vein.” Currently MacKenzie rates MAG Silver as a speculative Buy with a target price of $24 per share. MAG shares are currently trading at around $16.

Rodman & Renshaw analyst Heiko Ihle also has a positive outlook on the Juanicipo project, rating MAG Silver as a Buy and highlighting the “continued exploration success at the project, along with further advancement toward production.” In a July 10 research report, Ihle focused on the success the company has had at its Deep Zones “which contained 333 g/t silver, 16.87g/t gold, 4.47% lead, 3.77% zinc and 1.04% copper over 5.2 meters.” The results will most likely lead the joint venture partners to “consider sinking an internal shaft to access deeper zones. . .where strong gold grades have also been discovered.” Although the cost could mean a 30% increase in capital, Ihle believes the expansion would add value to the project.

Ihle also points out that “underground development activities have recently accelerated, primarily in order to allow for the expected increase in processing capacity at the project. To date, ramp development at the project has exceeded 3,500 meters, and construction of additional ventilation raises continues to progress.” The target price of $20.50 “is a reflection of the larger 4,000 tpd scenario in our model, slightly offset by our expectation of increased capital required to build out the facility,” concluded Ihle.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Melissa Farley compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She owns, or members of her immediate household or family own, securities of the following companies mentioned in this article: None. She is, or members of her immediate household or family are, paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are sponsors of Streetwise Reports: MAG Silver Corp. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Additional disclosures about the sources cited in this article

( Companies Mentioned: MAG:TSX; MAG:NYSE.MKT,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17557