Gold Digger: Seek and ye shall find
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Unearthing a discovery of biblical proportions — like Hemi, Julimar, Boda, Haverion, Winu, or Oak Dam — often takes years of persistent, unsexy exploration work.
After many moons of underinvestment in the sector, figures released earlier this month show that ‘Programme of Work’ applications from WA explorers have hit a five-year high.
It’s not just WA, either. Exploration more generally is booming.
The gold industry is responsible for a huge chunk of the capital raised in 2020, as investors ride the wave of strong prices and positive sentiment into IPOs and cap raises; both often oversubscribed.
We’ve seen some doozy raises this month alone, led by De Grey’s (ASX:DEG) monster $100m at a 1 per cent premium to the 10-day volume weighted average price. Crazy.
And despite sentiment (and prices) softening this week, gold explorers like Norwest Minerals (ASX:NWM), takeover target Alto Metals (ASX:AME), and minnow Red Mountain Mining (ASX:RMX) have still been able to lock in cash to fund their upcoming (hopefully company making) exploration programs.
Here’s how 187 ASX-listed gold stocks performed September 21 – September 25 [intraday].
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Mont Royal Resources (ASX:MRZ) will earn up to 70 per cent of the Wapatik gold-copper project in Canada from TSX-listed Azimut Exploration.
In January, Azimut hit the motherlode at the nearby ‘Patwon’ discovery. Spectacular hits like 3.15 grams per tonne (g/t) gold over 102m sparked a 200 per cent increase in its share price and prompted numerous junior explorers to pour into the region.
Tesoro Resources’ (ASX:TSO) El Zorro gold project in Chile is now 500 per cent bigger – a bit like the company’s share price, which is up +1000 per cent over the past six months. Pretty impressive stuff from the former online jewellery seller.
Fellow supercharged gold explorer Dreadnought Resources (ASX:DRE) is now up 820 per cent over the past six months. This week, the first eight holes of a drilling program at ‘Metzke’s Find’ in WA all hit the gold lode. Highlight intercepts included 4m at 19.9g/t, 45m from surface.
The global miner could earn up to 75 per cent of the project by spending $22m over 10 years. Encounter also has lucrative joint venture deals with long-term partner and major shareholder Independence Group (ASX:IGO) and gold miner Newcrest Mining (ASX:NCM).
And First Au’s (ASX:FAU) historic high-grade ‘Haunted Stream’ gold project has now received key approvals from the Victorian government.
Historic mine records dating back to the 1880s show ore being extracted from Haunted Stream at +1 ounce per tonne (about 28g/t) – but these old mines are yet to be tested by deeper drilling, First Au says.