Value Microcaps Junior Miners

[Lone Clone]

IAU, KDK, ODV, EDVm BTO

Out of the blue, Nevada gold miner/developer i-80 Gold aka IAU surprised me with the announcement of a potential JV on one of their flagship properties, Ruby Hill, which contains a number of old mines and untapped deposits, both with CRD (Zn/Pb/Ag/Au) and various types of gold mienralization. Since IAU acquired it, they have made a number of new discoveries, both Au and especially CRD, and acquired Paycore to get their hands on where the CRD minerlaization extends.

At this point we don't get much information on the potential deal, presumably because any agreement is subject to further DD by the other party. We get no details about any terms of a JV, and all we get re the other party is that they are 'an arm's length third party'.

My best guess before reading that last quote was that the potential partner is Nevada Gold Mines, a JV between Newmont and Barrick with whom IAU has done a number of deals, but I don't see how NGM fits that description.

So we'll just have to wait and see about any details, and it would be premature to pass judgment before we hear those details.

https://www.siliconinvestor.com/readmsg.aspx?msgid=34472365

Kodiak Resources aka KDK has already defined two large copper-gold porphyries, Gate and West, on its MPD property in south central BC, Now, with the relase of assays from the first two holes into the Main zone, it looks like they have discovered a third.

One hole, drilled vertically, found several zones of mineralization between 30m depth and a kilometre down, including 0.25% Cu, 0.23 g/t Au and 0.70 g/t Ag (0.34% CuEq) over 75m, within a broader interval of 0.14% Cu, 0.08 g/t Au and 0.41 g/t Ag (0.17% CuEq) over 324m.

The other hole, angled towards an IP signature, found mineralization from 29M to 924M depth, including 0.34% Cu, 0.28 g/t Au & 1.71 g/t Ag (0.45% CuEq) over 116m within 0.17% Cu, 0.17 g/t Au and 0.86 g/t Ag (0.24% CuEq) over 337m. I was very pleased to see the hole also found a PM-rich zone that included 0.09% Cu, 0.43 g/t Au and 0.77 g/t Ag (0.30% CuEq) over 60m.

To the uninformed, these assay results may not seem very high, but there are several mines operating profitably in the area with similar deposits. The key for KDK is to define a sufficiently-sized set of porphyries, ideally with higher grade starter zones, and KDK is well along that path, not that you would know it from the share price.

https://www.siliconinvestor.com/readmsg.aspx?msgid=34473245

Osisko Development aka ODV released their Q3 results. At this stage in the development of the company, when they are focused on exploration and building mines are not generating much income from mining, you know they are going to be losing money, so the key questions are how much they are losing, how long the losses will go on, and whether they have enough money left to complete development.

ODV is generating a bit of income. Between their Trixie gold mine in Utah, the San Antonio tailings processing in Mexico, and their Cariboo Gold project in BC, they sold 3867 oz Au, but the $10.4M in revenues was almost offset by $10.1M cost of sales. Hence it is good they have plenty of money on hand, $71.5M at the end of Q3, to fund further development and make necessary payments.

ODV is planning to increase production at Trixie to 500 tpd, but first they need to get the remaining assays form this year's drilling, followed by a revised Resource Report, as well as infrastructure upgrades. They don't give a timeline but I would estimate two years.

At the Cariboo project, they anticipate receiving all permits by Q2 next year, but are vague about what happens next. For both Trixie and Cariboo, there will be a lot of detailed engineering work, and both properties contain multiple deposits, sometime with different mineralization, so careful planning and sequencing of mine development will be a must.

https://www.siliconinvestor.com/readmsg.aspx?msgid=34474242

West African gold producer Endeavour Mining aka EDV released its Q3 results, and they were very good. Gold production increased to 281k oz, while cash costs decreased, an unusual development for a big miner these days, to $848/oz Au. Net earnings of $60M meant that in spite of spending $143M on mine building and exploration, $100M on dividends, and $20M on share buybacks, they still had $625M in cash at the end of the quarter.

With several new mines coming on line next year, I expect EDV to continue to generate bigger numbers in the future. If the POG takes off in 2024 as expected, next year could be a good one for EDV shareholders.

https://www.siliconinvestor.com/readmsg.aspx?msgid=34474316

B2Gold aka BTO released its Q3 results, and they were, well, kind of boring. Production came in slightly below expectations at 225k oz Au due to some temporary operational issues, but this was offset by cash costs also coming in below expectations at $827/oz Au. At this point they are actually expecting 2023 cash costs to come in below guidance. They generated enough free cash flow that in spite of the costs associated with building a new mine at Back River in Nunavut, they ended the quarter with a healthy $310M cash stash.

At this point the main uncertainty affecting BTO is the coming decree expected to be released shortly by Mali. They don't expect it to affect their flagship Fekola mine, but it may affect the nearby deposits they are planning to develop.

https://www.siliconinvestor.com/readmsg.aspx?msgid=34474280

In response, TD issued a new analyst report calling the release Neutral, maintaining BTO at Action List Buy with a target of $9. Likewise, BMO's updated analyst report kept them at Outperform with a target of $7.50.

Saville opines that the gold mining sector completed a correction within an ongoing bull market in September, but that there will be 'gut-wrenching' corrections along the way as the rally continues next year. In the short term, the POG is balancing positive input from the decline in the 10-year TIPS yield versus the inevitable unwinding of the short term effects from the current situation in the Middle East.