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Three Exploration Companies to Watch

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Ely Gold's Three Charms 

An innovative business model, a one-of-a-kind database and deep roots in the world's best mining jurisdiction are Ely Gold's three advantages.

Ely Gold Royalties (ELY:TSX.V; ELYGF:OTCQB) is an emerging-royalty company with development assets focused in Nevada and the Western U.S. Its portfolio of 31 deeded royalties and 19 optioned properties, ranging from ranges from fully permitted mines to projects that are being permitted for mine construction, are generating significant revenue.

Why Sun Metals' Stardust Project Is Disruptive

Sun Metals' deep talent pool is set to do great things in British Columbia.

Late last fall, Sun Metals announced that its exploration program at its Stardust project in northcentral B.C. returned a spectacular drill result.

How to Build the Leading Base Metal Mining Company in Canada

Osisko Metals (TSXV:OM) controls two of Canada's premier zinc mining camp.

With the ramp up of global infrastructure projects underway while the world's supply of zinc shrinks, Osisko Metals will be in an enviable position to meet future demand.


Ely Gold's Three Charms 

An innovative business model, a one-of-a-kind database and deep roots in the world’s best mining jurisdiction are Ely Gold’s three advantages, says CEO Trey Wasser.

Wasser spoke to Kitco Mining at the Metals Investors Forum in Toronto this month. 

Ely Gold Royalties (ELY:TSX.V; ELYGF:OTCQB) is an emerging-royalty company with development assets focused in Nevada and the Western U.S. Its portfolio of 31 deeded royalties and 19 optioned properties, ranging from ranges from fully permitted mines to projects that are being permitted for mine construction, are generating significant revenue. 

Ely Gold's innovative option/royalty model allows the company to sell 100% of its projects in an outright sale or on a four-year option contract. On every property Ely Gold retains a royalty on future production. All portfolio properties are sold or optioned on a 100% basis, while the company retains net smelter royalty interests. 

Wasser says the advantage to his model is that onerous work commitments are not placed on the company so the business can keep growing. And the model has also allowed Ely Gold to put more money to work.

"With the cash flow from the option portfolio last year we went out and bought two near-term producing royalties," says Wasser.

One of the projects was the Fenelon project in Quebec. 

"The Fenelon is a very exciting project. It has unbelievable grades. They are doing a bulk mining project, which is improving the infrastructure quite a bit."

Ely Gold’s database gives it a leg up in Nevada. The company maximizes value through claim consolidation and advancement using its extensive, proprietary data base. The company can analyze missed development opportunities by uncovering overlapping ownership claims.  

"The title issues can be very tough to clean up, and that is what we specialize in," says Wasser. 

Nevada is a mining state, and this year it was ranked the world’s best mining jurisdiction in the world by the Fraser Institute. 

Ely Gold also got a stamp of approval from a heavy-hitter Sprott Resource Holdings, which now holds 9 ½%. 

"While we really didn’t need the capital, one of our goals for 2108 was more institutional ownership, so we couldn’t have asked for a better institution than Sprott," says Wasser. 


 

Why Sun Metals' Stardust Project Is Disruptive

Sun Metals' deep talent pool is set to do great things in British Columbia, says CEO Steve Robertson who spoke to Kitco Mining at the Metal Investors Forum in Toronto this month.

Late last fall, Sun Metals announced that its exploration program at its Stardust project in northcentral B.C. returned a spectacular drill result:

  • Diamond drill hole 18-SD-421 returned a total 100-metre intersection grading 2.51% copper (Cu), 3.03 grams per tonne (g/t) gold (Au) and 52.5 g/t silver (Ag) for a 4.99% copper equivalent (CuEq), including, 36.5 metres of mineralization, grading 3.89% copper (Cu), 4.47 g/t gold (Au) and 84.6 g/t silver (Ag).

  • The 100-metre intersect also includes 22.8 metres of mineralized skarn alteration in the hanging wall of the massive sulphide that averages more than 1% copper equivalent. The mineralized interval in diamond drill hole 18-SD-421 is in a newly identified mineralized area, outside of the current 43-101 resource estimate.

"I don't think anyone was expecting us to go out and hit the type of result we did," says Robertson.

"That is why we are considering this to be a disruptive discovery."

To move the project forward, Sun Metals has assembled a who's who of mining in B.C. Sun Metals director Mark O'Dea is a seasoned geologist and deal maker who runs Oxygen Capital. O'Dea's Aurora Energy Resources sold to Paladin Energy for $260M, and his Fronteer Gold was picked up by Newmont Mining for $2.3B. Robertson himself is an executive at Imperial Metals. His team took Red Chris project, located in northwest B.C., from discovery to mine. Red Chris was recently bought by Newcrest for $1.1B.

"This business is a lot about people," says Robertson.

"We really do have a star-studded cast."

Robertson says Sun Metals is using a science driven approach to analyzing opportunities. It is attracted to data-rich projects with the greatest potential for big discoveries that will grow value for shareholders and communities alike.

"No one was expecting Eskay Creek—the highest-grade gold mine in the world—to be found in Northern B.C. because there was nothing else around it at the time," says Robertson, alluding to some of Canada's top discoveries.

"Nobody was expecting Chuck Fipke to come up with diamonds in the Northwest Territories."

"These things get found and we clearly have a very strong system on our hands."


 

How to Build the Leading Base Metal Mining Company in Canada

Osisko Metals (TSXV:OM) controls two of Canada's premier zinc mining camps, says executive VP Paul Dumas who spoke with Kitco Mining at the Metal Investors Forum in Toronto earlier this month.

With the ramp up of global infrastructure projects underway while the world's supply of zinc shrinks, Osisko Metals will be in an enviable position to meet future demand.

"Zinc is an under-valued commodity right now," says Dumas noting zinc mine depletions and closures.

"The underlying value of our assets should eventually be reflected  in the price of our equity."

Osisko Metals' flagship Pine Point Mining Camp is located in the Northwest Territories and has an inferred mineral resource of 38.4 Mt grading 4.58% zinc and 1.85% lead. The property has tremendous upside potential as it has never been explored using modern-day technologies and has never seen any drilling deeper than approximately 100 metres. It is a brownfield site, once a large-scale mine operated by Cominco. The mine closed in 1987.

The project is located on the south shore of Great Slave Lake in the Northwest Territories, and is accessible directly and year-round by an all-weather highway from Hay River, the economic "Hub of the North".

The project is comprised of mineral claims and mineral leases covering an area of 22,213 hectares containing key stratigraphy that hosts zinc and lead mineralization. The center of the property is located 96 km east of Hay River that has rail transportation and loadout options as well as other available services. On-site infrastructure consists of approximately 100km of intact 25-metre wide haulage roads that link the mineralized zones and an active electrical substation located in the middle of the property that previously serviced mine and mill operations.

The second property is the Key Anacon project, located 20 km south of the town of Bathurst, New Brunswick. A maiden resource estimate released last month to convert historical resources to compliant NI43-101 found 249.1 mil (million) lbs zinc, 102.6 mil lbs lead, 9.3 mil lbs copper, and 4.3 mil oz of silver and Inferred: 453 mil lbs zinc, 126.4 mil lbs lead, 27.0 mil lbs copper, and 5.9 mil oz of silver. The camp has good infrastructure and is located beside major forestry roads. Like Pine Point, Key Anacon has not seen any use of modern-day exploration techniques and only very sporadic drilling , due to the fact that the project was privately owned for the last 60 years or so, prior to Osisko Metals acquiring it. In 2018, the Company began a drill program and was successful  at  extending the project's Main and Titan Zones at depth and along strike,and both remain open. Work will continue into 2019.

With Pine Point and Key Anacon, Osisko Metals is being propelled to become to the leading base metals mining company in Canada.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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