Nevada Explorer Reports 'Outstanding Intercepts'

Source: Michael Ballanger 05/09/2024

Michael Ballanger of GGM Advisory Inc. shares recent “outstanding intercepts” from i-80 Gold Corp. as well as thoughts on the current quiet junior market.

Nevada explorer-developer i-80 Gold Corp. (IAU:TSX; IAUX:NYSE) reported an outstanding intercept today of 22 meters of 31 grams per tonne gold (g/t Au) at Granite Creek and released an update on progress at the South Pacific Zone.

i-80 Gold Ramps Up 2024 Granite Creek Exploration & Development Program

“RENO, Nev., May 7, 2024 /CNW/ – i-80 Gold Corp. (IAU:TSX; IAUX:NYSE) (“i-80″, or the“Company”) is pleased to provide an update on planned programs at the Company’s Granite Creek Property (“Granite Creek” or “the Property“) located in Humboldt County, Nevada. This work being conducted in 2024 is expected to include definition and expansion drilling, underground development and test mining of the South Pacific Zone, and a Feasibility Study.

The primary focus is bringing the South Pacific Zone (“SPZ“) into the long-term mine plan. The SPZ is expected to become the primary horizon for mining once initial development has been

extended to provide access. As part of the 2024 program, definition drilling to support increasing Measured and Indicated Mineral Resources will be accelerated in advance of the completion of a Feasibility Study for the Granite Creek Underground mining operation.

Additionally, expansion and exploration drilling will also be completed.

The 2024 drilling program will follow up on the successful 2023 “Phase 1″ drilling completed from underground and surface (see Figure 1). Drilling from underground was completed in the upper portion of the SPZ, where initial stopping is expected, and surface drilling was completed in the northern portion of the deposit. Both programs returned exceptional high-grade results, including:

Highlight results from 2023 underground drilling in the South Pacific Zone (core width)

• 1 g/t Au over 21.9 m (0.91 oz/ton Au over 72.0 feet) in hole GCPU23-22*

With improved definition drilling, initial development, and test mining of the SPZ, the Company will plan to complete an updated resource estimate and Feasibility Study. The SPZ remains open for expansion at depth and along strike to the north towards Nevada Gold.”

Comment: This further accentuates the difficulties facing junior developers.

Carrying a market cap of US$450 million on a share count of 384 million, even superb results from a Nevada-based, advanced project failed to move the needle.

Getchell Gold

It is my best answer as to why a US$400 move up in the price of gold has failed to move the needle for Getchell Gold Corp. (GTCH:CSE; GGLDF:OTCQB) whose market cap of US$12.4 million is valuing their Nevada ounces at US$8.31 per ounce. i-80 Gold has an inferred and indicated resource of 14.5m ounces, and at a fully diluted market cap of US$458m, its value-per-ounce is US$31.58/ounce.

The company recently reported a loss of CA$0.07 on revenue of CA$25.84 million so it is obvious that the market was unimpressed with their total resource number and/or execution. Add to that a CA$115 million bought-deal financing, adding 69,698,050 units (total potential dilution of 104,547,075 shares) to the already-issued 384,896,725 shares, representing a 27.2% dilution of the existing ownership base. The stock had a 52-week low of CA$1.55 and currently sits at CA$1.58 bid.

To be fair, May is usually the quietest month for the junior space and has been since I first began trading junior explorers in 1977. The reason for this seems to be irrelevant in 2024, but it was always weather-related as this is called the “Spring Break-Up,” where most of the snowpack and frozen lakes are melting, and with muddy and boggy conditions in northern Canada, the drillers await the return of drier weather and ground conditions before recommencing drilling.

In other words, it is always “quiet” during the May-June period. I expect that the imminent announcements of drilling plans for the other juniors like American Eagle Gold Corp. (AE:TSXV), Fitzroy Minerals Inc. (FTZ:TSX.V; FTZFF:OTCQB), and Vortex Metals Inc. (VMSSF:OTCMKTS;VMS:TSX;DM8:FSE) will trigger buy-side volume. As for Getchell, I expect the results of the metallurgical study and the upcoming revised resource estimate, in preparation or inclusion of the PEA expected in June, should increase the prospect for rerating (i.e., higher price targets) for GTCH.

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Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Getchell Gold Corp., American Eagle Gold Corp., and Vortex Metals Inc.
2. Michael Ballanger: I, or members of my immediate household or family, own securities of: All. My company has a financial relationship with: Fitzroy Minerals Inc. I determined which companies would be included in this article based on my research and understanding of the sector.
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Michael Ballanger Disclosures

This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

( Companies Mentioned: GTCH:CSE; GGLDF:OTCQB, IAU:TSX; IAUX:NYSE, )