Exclusive Insights on the Gold Market – Tue 22 Aug, 2017

A Focus on the Windfall Lake District and Companies In Play

David Erfle, the Junior Miner Junky, joins me today to discuss the windfall lake district in Quebec that has been a great investment for those in early. Osisko has been driving the news but there are a number of other companies that need to be considered in the area. David and I look at Beaufield, Bonterra, Secova, and Opus One.

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Featuring:
David ErfleCory Fleck

Comments:
  1. On August 22, 2017 at 11:18 am,
    CFS says:

    Klondike Gold Mobilizes Second Drill; 40 Holes Planned in 30 Days. August 22
    Vancouver, British Columbia, Canada, August 22, 2017, Klondike Gold Corp. (TSX.V:KG; FRA: LBDP)
    (“Klondike Gold” or the “Company”) announces a second diamond drill is being added to the exploration
    program to accelerate testing of recently identified targets within the Company’s 527 square kilometer
    Klondike district property, Yukon Territory.

  2. On August 22, 2017 at 11:24 am,
    Bonzo Barzini says:

    I just bought back the PVG that I sold a year ago@12.05. It may fall to 7 but will be a lot higher one day. I like Quartermain! What ever happened to LPG? He used to talk about PVG.

    • On August 22, 2017 at 11:33 am,
      OOTB Jerry says:

      Good question…….maybe he ran out of propane…….

      • On August 22, 2017 at 11:34 am,
        OOTB Jerry says:

        The French do take long vacations……..

      • On August 22, 2017 at 11:35 am,
        LPG says:

        Jerry, you still crack me up !
        Best to you,
        LPG – ROOP

        • On August 22, 2017 at 11:37 am,
          OOTB Jerry says:

          Glad to hear from you…….Hope all is well…..

  3. On August 22, 2017 at 11:34 am,
    LPG says:

    Hello Bonzo,
    Hope you are well.
    I still look at the site, once in a while, as you can see. 🙂
    I smiled at your comment re: PVG as i also sold last year at usd12-ish and also considered picking some again lately – i actually considered this yday. But i see more POTENTIAL for some other names, so fwiw, i didn’t reallocate to PVG.
    To answer your question re: me on KER, i mentioned to Big Al and Cory a while back that I am reluctant to discuss publicly about various topics given my current occupation. So this is why you haven’t heard me in a while on KER.
    Irrespectively, hope all is good for you, and all the best wiith both PVG and your other investments.
    LPG

    • On August 22, 2017 at 11:36 am,
      OOTB Jerry says:

      Dang that was quick………the “Propane Torch”

      • On August 22, 2017 at 11:38 am,
        LPG says:

        Be careful Jerry…
        There is always someone watching ya !
        🙂
        Luv”
        Da French Torch

        • On August 22, 2017 at 11:43 am,
          OOTB Jerry says:

          Is’nt that the truth……. Best to you……

      • On August 22, 2017 at 11:41 am,
        OOTB Jerry says:

        Maybe, you could give us some info, on some good beach and farm house to rent.. 🙂

        • On August 22, 2017 at 11:46 am,
          LPG says:

          Farm house wise…if u “don’t mind” the location, i saw some very pretty ones “near” the syrian border this week-end…
          Best,
          LPG

          • On August 22, 2017 at 11:48 am,
            OOTB Jerry says:

            Vacant and ready to move into I bet………A little dusting and cleaning ….move in ready..

          • On August 22, 2017 at 11:50 am,
            OOTB Jerry says:

            I was thinking closer to wine country….. I want to bring Big Al with me, ….I know he will spring for all the expenses…….

          • On August 22, 2017 at 1:53 pm,
            Excelsior says:

            Fixer uppers…. : -)

    • On August 22, 2017 at 11:38 am,
      CFS says:

      https://www.americanbankingnews.com/2017/08/22/pretium-resources-inc-pvg-given-average-recommendation-of-buy-by-brokerages.html.

      It currently has a “buy” recommendation by the 6 analysts that follow PVG, with a $17 price projection (12 month)

      My projection, as an owner of PVG, is $16.

    • On August 22, 2017 at 1:11 pm,
      Bonzo Barzini says:

      Thanks. LPG. Funny we both sold PVG at 12 and are interested again. I think once their mine has cash flow they can spend on drilling and find a lot more gold. And they are supposed to earn $1.18 next year(one analyst says 1.84) which would support a much higher price. Hope the new mine works as planned or it could get hit like NGD.

      • On August 22, 2017 at 4:53 pm,
        Excelsior says:

        I’m still very concerned about the consistency with Pretium and their raisin bread effect. Investors have been hashing out the same comments we made on here about 2 years ago, and that Brent Cook & the Angry Geo warned about as well:

        @RubiconRIP – “Majors would have bid on $PVG a long time ago. It is not a matter of management being incompetent or devoid of integrity. However the existing mine plan is way too optimistic given the inconsistency of the ore body. I estimate ASIC will be 1300-1350 in 2018. They will continue to extract metal next year and beyond, but shareholders will not win.” — 21 Jun 2017

        @ocotilloredux – “I went through the last round of intensive underground drilling section by section and failed to find an orebody. If a geologist cannot put F/W H/W contacts on it due to structure or at worst assay chip sample or closely spaced u/g drilling it ain’t an orebody. MIK can be OK in some open pit situations where blasthole chip samples can be assayed prior to blasting to differentiate the boundaries between ore and waste and then choke blast using a backhoe for excavation after the geo’s tape the boundaries but underground blasthole stoping does not provide this degree of selectivity. So watching this one will be fun. I suspect chip sampling will actually help here despite Snowden poo pooing it. ” — 23 Jun 2017

        @ocotilloredux – “The underground geologists need a means of determining the difference between ore and waste but Snowden in their technical report told us that chip sampling was biased, underground drilling was biased, tower sampling was biased, three of the five original planned crosscuts bulk sampled below the mining cut off grade despite their model predicting otherwise etc. ”

        “So I am at a bit of a loss for what tools the underground geologists will use here to differentiate between ore and waste. Recall that the whole model relies upon converting a random 0.5m intercept at say 1,000 g/t into a 10 m x 10 m x 10 m block of ore grading 15 g/t say using the magical wonders of MIK. (And the 0.5 m intercept itself could very well have been 0.05m at 1,000,000 g/t (since 0.5m was the minimum core length assayed), in other words a random nugget). Driving crosscuts through the “mineralization”, chip sampling the walls, floor and back to establish potential stope hangingwall and footwall based on assay cutoffs, then assaying the blasthole chips to see if it possible to exclude some portions of the stope from blasting if below cut off grade (difficult to do) is the only hope of pulling some sort of grade control here. ” — 24 Jun 2017

        @teevee – “ocotilloredux, the consultants who signed off on the reserves better have lots of insurance as they will be who gets blamed. $pvg” — 24 Jun 2017

        @ocotilloredux – “Snowden is from Australia. They will retreat to there. The story with AMC is much more interesting. Teevee when $pvg collapses shortly there will no doubt be the usual 5 minute sino forest memorial service where all the rest of you can go get f@%ked since we have official markets to run here.” — 24 Jun 2017

        @Kevin – “PVG – interesting that the latest news release has no mention of reconciliation gold produced vs gold in the model. You will know when it’s time to short this one by checking their website under careers. give it a few months and if senior positions start to open up you’ll know how to trade.” — 24 Jun 2017

        @hazzard – “4 bucks would give us an MC of more than 200m. While that could be possible in a rabbid bull market for PMs (which we are not in), It’s kinda wishful at this point. The last results had some great hits and bumped us up about 20m. The next results may do the same. But we are a long way from defining any specific quantity at any specific grade. A huge amount of work needs to be done before comparables come into play. Having said that, one never knows how much money might be sitting on the sidelines waiting for a bump in POG or a great speculative story. This is a great story and the last results helped cement the potential. More great results could drive speculation so who knows where the share price goes. Look how fast $PVG shot up many years ago on great drill hits. It’s possible here. Can anyone say for sure at this point? Not likely. The super hi grade is alluring. What I’m looking for are long intervals (10 to 40 meters) of 3, 4, or 5 g/t. That’s pay rock. If there are little jewelry boxes of “wow” high grade, so much the better.” — 25 Jun 2017

        @athabasca – “I expect quarter over quarter results to be inconsistent for this mine. The geological interpretation to date shows 90% of the gold in 5% of the rock. There will be fantastic quarters and horrible quarters but I do not think these variations will be fatal-just tough for one that wants to see consistency. I expect good recoveries but erratic production numbers.The gold is there and it will be recovered and lots of money will be made but I feel for someone who thinks that grade control is the only way to make this mine work.” — 5 Jul 2017

        @FundamentalAnalysis – “Big move down, since share prices often relate to something going on….if moves like this continue….there could be problems which some have been outlining. time will tell.” — 8 Aug 2017

        @zentrarian – “FundamentalAnalysis…You could be right, of course. But you aren’t going to convince me that Bob Quartermain sunk $600 million into something he wasn’t 100% sure was a highly profitable project. Certainly there will be (hopefully minor) issues, but the Strathcona debacle taught me that the market tends to overreact to anything negative or the least bit suspicious with regard to $PVG. Maybe they are just getting on with the job?” — 9 Aug 2017

        @Kevin – “so 16.8 koz of gold recovered from 83 kt of ore. Thats a 6.29 g/t grade recovered, so head grade would be maybe 7 ish. Its still pretty early for whats it worth, but given all the risk around the grade of this deposit, I think its telling that they have yet to mention a reconciliation of production to reserves.” — 10 Aug 2017

        @zentrarian – “Yeah, all in all it sounds reasonably good to me but unfortunately isn’t going to resolve the nagging doubts about the consistency of the grade. I guess that would be too much to ask at this stage, but “low grade stockpiles and mush” doesn’t sound too reassuring to investors who don’t know how commercial production is efficiently ramped up.” – 11 Aug 2017

        @ocotilloredux – “Gold mills are relatively simple to crank up since it really is a function of grinding capacity. Where there is some latitude is with respect to what to feed the mill. Starting off low grade makes sense, then feeding high grade stockpiles to quiet doubters like me likely pays dividends. It is when the mill runs 100% stope ore, I am most curious about. I think this one will settle down at around 7-8 g/t for a couple years before falling away to about 4 g/t. A stock that does not deserve a $3B market cap.” — 12 Aug 2017

        @zentrarian – “Ocotilloredux, True but don’t forget that there’s still a lot of very hot property around the mine. “A couple of years” gives them a lot of time to drill it out, also a lot of time for the PoG to increase & multiply the bottom line. (Not to mention bring back Snowfield which at the current PoG is completely discounted.)” — 12 Aug 2017

        @ocotilloredux – “Zentrarian, If you understand the nature of the mineralization and the attempts to define it structurally/grade wise/directionally etc. this is one tough nut to crack. I built plenty of mines in my time and have never seen one built like this one on such flimsy geological modelling. ” — 12 Aug 2017

        @zentrarian – “ocotilloredux Reasonable doubts, which seem to be shared by a lot of people. That will either make the rest of us (especially Bob Q) fools or a lot of money. FWIW I made my own decision during and after the Strathcona debacle and will stick to it until proven wrong. Time will tell… ” — 12 Aug 2017

        @ocotilloredux – “Thanks Zentrarian for your disclosure. My take is that Bob Q is the fools of fools. Saw this guy coming. Another 50% fall in free cash flow. Spent plenty of years looking at geological sections to make mines of the unknown known. The spot price needs a 30-50% increase. ” — 12 Aug 2017

        @athabasca – “I did a bit of arithmetic and grade is definitely king. There is a little bit of truth to my contention that higher tonnage at a slghtly lower grade does work but the effect is certainly buried by a grade change-either up or down.” — 15 Aug 2017

        @hihosilver – “Ocotilloredux said it perfectly, they will high grade for a few years at 7-8g/t. Once that is no longer an option you are down to 4g/t and the stock is toast. So really depends on your timeframe. I think it will be quite a while before investors jump ship. I am not short because the stock could do well short term.” — 15 Aug 2017

        https://ceo.ca/pvg

  4. On August 22, 2017 at 12:41 pm,
    Markedtofuture says:

    Defining Hypocrisy: Democrats Warn Steve Bannon Against Publishing Classified Info On Breitbart

    Now this is rich. After nearly 9 months of Democrat operatives leaking every piece of sensitive and/or embarrassing information they could get their hands on to the New York Times and Washington Post, they’re now suddenly worried about Steve Bannon doing the same. We guess it’s one of those ‘do as I say, not as I do” sort of things.

    As McClatchy points out, Elijah Cummings, the senior Democrat on the House Oversight Committee, seems to be particularly worried about what Bannon might publish in his renewed role at the helm of Breitbart.

    http://www.zerohedge.com/news/2017-08-22/defining-hypocrisy-democrats-warn-steve-bannon-against-publishing-classified-info-br

    • On August 22, 2017 at 1:23 pm,
      OOTB Jerry says:

      Elijah should have worked a little harder to have the Hilly emails brought to the floor.

      • On August 22, 2017 at 1:24 pm,
        OOTB Jerry says:

        Really RICH…….

    • On August 22, 2017 at 1:25 pm,
      OOTB Jerry says:

      Wonder if they are just leaked……who will know the difference………

      • On August 22, 2017 at 1:26 pm,
        OOTB Jerry says:

        Who knows……..maybe someone broke into his computer…..

  5. On August 22, 2017 at 1:02 pm,
    Bonzo Barzini says:

    Welcome back, LPG. What is your current occupation? If you are near the Syrian border perhaps you work for French intelligence avec Clouseau. Have you sold your Novo Resources yet? I have not.

    • On August 22, 2017 at 2:02 pm,
      Dick Tracy says:

      How far do you think it will retrace, $3 perhaps mon ami?

      • On August 22, 2017 at 3:38 pm,
        Dick Tracy says:

        Novo, is still over valued and with the market in a wait and see approach on The Korean peninsula, there is not a lot of interest in much of anything in the commodity markets. Psychology is king, psychology holds the keys to whether we move forward or not. DT

      • On August 22, 2017 at 9:04 pm,
        LPG says:

        Hello DT,
        Hope all is good with you.
        I recently drew a support line coming from the < ca$1 area and connecting some lows along the way. This suggests support in the high ca$3 region… My only issue with doing this is that it is "too" obvious for too many eyes.
        A s an aside, a 50% retrace of the whole move up suggests low ca$3.
        Hope this helps a bit.
        LPG

        • On August 23, 2017 at 2:16 am,
          LPG says:

          DT,

          As a quick follow-up…
          1) NVO.v actually hit yday the support line I had drawn and connecting some lows – that’s FWIW.

          2) Calculating some retraces from CAD0.40 to the CAD5.91 recent top gives the following:
          * 38.2% retrace = 3.81 target (check yday’s low 😉 )
          * 50% retrace = 3.16 target
          * 61.8% retrace = 2.50 target

          Best,

          LPG

    • On August 22, 2017 at 8:57 pm,
      LPG says:

      Bonzo,
      Re: Novo, i still own a 1/3 of my position, which i will ride.
      My cost was 90cents-ish, so i derisked my investment in the recent “pop” to > cad5.
      If Quinton theory is proven right (and i believe it will be, simply because nobody believed it for many years), these shares are going much higher… We will see.
      Best,
      LPG

      • On August 23, 2017 at 1:04 am,
        bonzo barzini says:

        LPG, thanks . My Novo avg cost is .80 and I’m going to hold on tight until NEM offers me a share of NEM for ea share of Novo. Do you own MUX or Rye Patch?

        • On August 23, 2017 at 8:50 am,
          LPG says:

          Bonzo,

          I own MUX, to which I added a few days ago after they announced the purchase of assets from Primero for what I viewed as pretty much peanuts.

          Re: RPM.v, I don’t own it: I had issues with the term of the financing of their mine last year (which I thought was EXTREMELY dilutive – I had written about this on the blog), and FWIW, I’m so far not impressed with execution…

          Hope this helps,

          Best,

          LPG

  6. On August 22, 2017 at 3:03 pm,
    brian says:

    I think Secova has the most potential of any of the companies discussed (Reward/RIsk) However, there are 50 million of PP shares (used to raise $2.5M), so the share price is stuck around $0.05 for some time. It makes it easy to enter a position gradually, though.

    You can see the influence of millions & millions of PP shares keeping a good stock down in Theralase, too.

    • On August 22, 2017 at 3:35 pm,
      Excelsior says:

      Speaking of the WINDFALL LAKE Area Play:

      #Quebec #AreaPlay #Map of:

      $OR $MTO $BFD $BTR $GOR $URB $SEK #Gold #Drillplays

      http://goldrea.com/wp-content/uploads/2015/04/argosmap.jpg

      • On August 22, 2017 at 3:39 pm,
        Excelsior says:

        (MTO) (MEAOF) Metanor is one of the most interesting plays in the area to me because they actually have an operating mine here. They are PRODUCING already and just restructured their balance sheet in the last year, so they are ready to rock n roll.

        Beaufield, Bonterra, and Secova are still in the exploration part of the cycle.

        Metanor is exploring while they Produce Gold. (the Earn while they Learn model)

        Metanor Drills New High Grade Zones at Barry Project
        by @marketwired on June 8, 2017

        https://ceo.ca/@marketwired/metanor-drills-new-high-grade-zones-at-barry-project

        • On August 22, 2017 at 3:41 pm,
          Excelsior says:

          (MTO) (MEAOF) Metanor Resources – Corporate Presentation:

          BACHELOR
          GOLD MINE AND MILL
          • CIP Mill with a recovery > 96% and availability > 95%
          • Mill capacity of 800 tpd with Bachelor ore (1,200 tpd
          with Barry ore)
          • Hoisting capacity down to 1,200 meters of 1,500 tpd
          • Current shaft depth: 700 meters
          • Lodging capacity on site for 260 employees
          • Power availability > 7 MVA (66% used)

          http://www.metanor.ca/wp-content/uploads/2016/02/Corporate-presentation-2017-07-rev2-Eng.pdf

          • On August 22, 2017 at 3:43 pm,
            Excelsior says:

            Metanor Resources Inc.(MTO) is a Canadian gold producer located in the mining sector of the friendly and prolific Abitibi greenstone belt in Quebec. Its flagship, Bachelor mine, reached commercial production on December 1, 2013 and produces 35,000 oz per year, with a cash cost of CND $889 and a sustaining cost of CND $ 1075 (2016-12-31). Metanor also shows ongoing exploration success for resource and mine life expansion.

            KEY DRIVERS
            Building a leading gold producer
            Proven operator
            Strong organic growth as well as M&A opportunities within the area

            The Company has four properties in Quebec and one in Ontario, which are located at the heart of historically prolific mining areas. The Bachelor, Barry and Dubuisson properties contain a total of about 1.6 million ounces of gold (NI 43-101, all categories). The Bachelor mill and mine infrastructure is a fully functional, fully permitted and easily expandable operation.

            Quebec has consistently been named by the Fraser Institute as one of the best places in the world for mineral exploration, and Metanor is included under the Quebec government’s Plan Nord.

        • On August 22, 2017 at 3:47 pm,
          Excelsior says:

          I could see another company coming in to acquire Metanor and one of the other projects to challenge Osisko, and start things off with a production center and use it as a hub fed by the other discoveries.

          Just sayin’ (since nobody even mentioned Metanor on this Windfall lake discussion).

          Again….. LOOK AT THE MAP. Metanor is completely in the thick of things between Osiskos 2 big land packages. (ding, ding, ding)

          http://goldrea.com/wp-content/uploads/2015/04/argosmap.jpg

          • On August 22, 2017 at 3:49 pm,
            Excelsior says:

            Urbana is small but will likely get gobbled up as well. (nobody discussed them either)

          • On August 22, 2017 at 4:23 pm,
            Excelsior says:

            I’m not sure that Durango or Golden Rea have much to speak of other than nearology. Their land packages are out of the action.

          • On August 22, 2017 at 4:25 pm,
            Excelsior says:

            P.S. – The big company will either be Kirkland Lake or Wexford Capital.

            (to take the mystery away…..)

      • On August 22, 2017 at 3:51 pm,
        Excelsior says:

        METANOR COMPLETES PRIVATE PLACEMENT OF $5.9 MILLION

        June 30, 2017 – Val-d’Or, Québec, Canada – Metanor Resources Inc. (TSX-V: MTO) announces the closing of the previously announced private placement in the amount of $5,932,500 under which a total of 5,250,000 flow-through shares have been issued at a price of $1.13 each. The gross proceeds will be used for exploration work on the Corporation’s properties located in Quebec.

        In connection with the Offering, the Agents led by SPROTT Capital Partners, and included Red Cloud Klondike Strike Inc., received a cash fee equal to 6% of gross proceeds.

        http://www.metanor.ca/en/communiques-presse/metanor-completes-private-placement-of-5-9-million/

        • On August 22, 2017 at 4:12 pm,
          Excelsior says:

          NEW STRATEGIC INVESTOR FOR (MTO) METANOR: (KL) KIRKLAND LAKE GOLD

          April 4, 2017 – Val-d’Or, Québec, Canada – Metanor Resources Inc. (TSX-V: MTO) is pleased to announce that it intends to complete a private placement financing pursuant to which Kirkland Lake Gold Ltd. will acquire up to 103,571,429 Units of the Corporation on a pre-consolidated basis at a price of $0.07 each, for gross proceeds in the amount of $7,250,000. Each Unit will consist of one common share (“Share”) and one-half of one common share purchase warrant (each full warrant, a “Warrant“) which will entitle the holder to purchase one Share of the Corporation at a price of $0.09 for a period of 24 months following closing (on a pre-consolidation basis).

          In addition, funds managed by Wexford Capital LP will be subscribing for 18,750,000 Units for gross proceeds in the amount of $1,312,500. Upon completion of the Offering, Wexford will hold 14.2% of the issued and outstanding Shares on a non-diluted basis and 19.9% on a partially diluted basis assuming the exercise of Warrants.

          http://www.metanor.ca/en/communiques-presse/2428/

          • On August 22, 2017 at 4:15 pm,
            Excelsior says:

            I think it is glaringly obvious based on Sprott’s interest in Metanor and Kirkland Lake, that (KL) is the company that is going to be competing with Osisko in this area.

            Doesn’t anybody else notice this??

            *It should also be noted that Wexford Capital are the geniuses behind (MLN) Marlin Gold that own about 85% of that company. They hold 19.9% of Metanor.

            If either Wexford or Kirkland Lakes a move on Metanor, then watch out, as after that they’ll grab one of the other exploration companies as well.

            Lots more going on here than just Osisko and the drillers…..

          • On August 22, 2017 at 4:21 pm,
            Excelsior says:

            I need to slow down when typing…. that should have said:

            If either Wexford or Kirkland Lake makes a move on Metanor……

      • On August 22, 2017 at 3:53 pm,
        brian says:

        Nice map, Ex. I had seen this once but could not remember where …

        It should also be noted, that Secova’s property is extremely early-exploration. In my opinion, they may not even have drill results in 2017 – their first property for drilling is Duvay

        • On August 22, 2017 at 4:07 pm,
          Excelsior says:

          Agreed. They are in the light green to the bottom right, but are not quite as central to the action as some of the other companies. I believe their strategy of focusing on the Duvay first is wise, because they’ll benefit by default just by being adjacent to Bonterra.

          • On August 22, 2017 at 4:20 pm,
            Excelsior says:

            I also believe, that the team at Secova believes that Duvay is better positioned for exploration than the land they staked near Bonterra, so they are going there first. Or maybe the plan on spinning that property out and selling the property near Windfall lake down the road, so they are trying to build value outside of that area play first.

            Either way it’s a big developing district, so when they do get around to drilling their property closer to Windfall Lakethey may keep turning more high grade ounces .

  7. On August 22, 2017 at 6:43 pm,
    GH says:

    Another online health documentary that began free screening today, on genetically engineered crops:

    http://www.gmosrevealed.com

    • On August 22, 2017 at 7:11 pm,
      Excelsior says:
      • On August 23, 2017 at 6:05 am,
        OOTB Jerry says:

        New food for CLAPPER……..z

    • On August 23, 2017 at 1:08 am,
      bonzo barzini says:

      Thanks GH. They are also showing Ty Bollinger’s Truth about Vaccines this week. Merck is as evil as Monsanto.