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Thursday, April 13, 2017 Derek Macpherson

SMT Updates Resource Estimate at Cusi

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Sierra Metals Inc. (TSX:SMT, BVL:SMT) provided an updated resource estimate comprised of drilling completed between January 2014 and January 2017 at its Cusi mine in Mexico (Figure 1). Due to the length of time since the previous resource update (2013) as well as differences in cut-off grades, recoveries, and average metal prices, we view the estimates as incomparable. The update does not include the 15,000m drill program which began in December 2016, targeting the Santa Rosa de Lima zone. The company is focused on converting resources into the measured and indicated categories, which will be incorporated in an updated resource expected in H2 2017. As mentioned in a post earlier this week, the company is in the process of obtaining a listing on the NYSE MKT, Cusi’s resource update will also aide in furthering that process. Sierra continues to achieve exploration success and deliver improvements at its operating mines, as this progress continues in addition to obtaining a US listing, we believe the progress should enhance the company’s value and improve the liquidity of the stock. read more


Thursday, April 13, 2017 Derek Macpherson

IDM's Red Mountain FS on Track; Improves Recoveries

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IDM Mining Ltd. (TSXV:IDM) provided an update on the status of the Feasibility Study expected to be released in the next two months, for its Red Mountain project northeast of Stewart, BC. The FS is well underway to be completed on schedule, as the company finalizes designs and plans for the underground mine, tailings management facility and underground geotechnical and hydrogeology work. Thus far, metallurgical work has resulted in mildly improved recoveries on average of 89.4% and 86.1% Ag (previously 88.9% Au and 80.3% Ag), which should benefit project economics. IDM continues to trade at a discount to peers on a P/NAV basis (0.55x vs. peers at 0.63x) and on a per ounce basis (C$49/oz vs. peers at C$60/oz). We expect pending results from the 2017 drill program and the advancing feasibility study, coupled with the project’s ongoing de-risking (engineering and permitting), to help close the valuation gap to peers.  read more


Thursday, April 13, 2017 Derek Macpherson

Otis' Exploration Activities Advance Kilgore

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Otis Gold Corp. (TSXV:OOO) provided an update on the exploration activities completed at the Kilgore Deposit and Gold Ridge exploration target at its Kilgore Gold Project in Idaho. The company completed magnetic and soil surveys at the Kilgore deposit and the surrounding areas, which revealed targets for future exploration. Otis is also in the process of planning a 2017 exploration program, which will consist of 8,000m of expansion drilling at Kilgore in late July, with permits expected later this quarter. At C$41/oz, Otis currently trades at a discount to peers (C$52/oz). We believe the market does not appear to fully account for the potential resource growth at Kilgore. We expect the upcoming drill program, pending resource update (Q2 2017) and PEA (Q3 2017) for Kilgore to be important catalysts for the company. read more


Wednesday, April 12, 2017 Derek Macpherson

SMT Updates Resource & Reserve Estimates at Bolivar

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Sierra Metals Inc. (TSX:SMT, BVL:SMT) announced an updated resource and reserve estimate at its Bolivar Mine in Mexico (Figure 1). The update includes drilling completed between January 2013 and September 2016, and does not include the current ~20,000m of expansion drilling underway at the mine. Results from the successful program are to be incorporated in an update expected in H2 2017. In our view, this resource does not compare to the previous one (2012) because of metal prices changes, process changes at Bolivar and production from the mine. However, as the company is focused on obtaining its listing on the NYSE, expected shortly, the resource and reserve update will aide in advancing that process. As Sierra continues to deliver operational improvements and exploration success at its operating mines, as well as accomplishing a listing on the NYSE, we view these as positive steps to enhancing the company’s value and improving liquidity of the stock. read more


Monday, April 10, 2017 Derek Macpherson

SCA's Phase 2 Results Support Growth; More Pending

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Savary Gold Corp (TSXV:SCA) announced additional results from its completed ~9,500m drill program at the Karankasso JV project (69.5% SCA/30.5% SWA) in Burkina Faso. The second batch of results comprised of 41 holes over 4,489m which focused on resource expansion at the Diosso South, Karangosso and West Trend areas. The company plans to begin an 8,000m (80 holes) phase 3 drill program in early May to follow-up on phase 2 results as well as test additional targets identified by auger drilling. We believe continued success from the drill programs at Karankasso along with the resource update expected in H2 2017 should benefit the company’s share price, as results continue to demonstrate resource growth potential. Savary currently trades at a discount to peers (C$23/oz vs. peers at C$44/oz).  read more


Monday, April 10, 2017 Derek Macpherson

Marlin Intersects High Grades at South HS Zone

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Marlin Gold Mining Ltd. (TSXV:MLN) announced high grade results from drilling in the southern part of the HS zone at its La Trinidad mine in Sinaloa, Mexico. The company reported two intercepts from drill hole 17TRD44, 15.55 g/t Au over 15.45m (upper intercept) and 5.81 g/t Au over 12.55m (lower intercept) which remains open to the west with the nearest drill hole to the north located 59m away. To note, the lower intercept confirmed mineralization beyond the current pit limits, and hit higher grades than previous results from hole 09TR023 announced on September 9, 2009 which intercepted 1.5 g/t Au over 17.8m, including 3.8 g/t Au over 5.8m. The company is planning to follow-up on these results, including targeting areas along strike to the south. Today’s results continue to support our view that La Trinidad’s mine-life could be extended via near-pit resources and that we expect the company to benefit from higher grades in the second-half of 2017 when they start mining the southern part of the HS zone. We expect continued exploration success to be an important near-term catalyst for the company. In addition, ongoing exploration activities at Commonwealth and a permitting update from San Albino on which the company has a gold stream, should provide positive momentum for the share price.  read more


Wednesday, April 05, 2017 Derek Macpherson

RPX Continues to Demonstrate Strike Extent

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Red Pine Exploration Inc. (TSXV:RPX) released results from five holes drilled at the Surluga deposit and noted visible gold in a recently completed hole at the past producing Parkhill Mine. While the results from Surlaga continue to impress and suggest resource growth, the visible gold identified in quartz veins at the Parkhill mine which is ~1km south the Surlaga deposit is the most important news. These results support our view that the Wawa Gold Corridor may have a strike extent of 4.75km. Considering that the current 1.1 million oz Au resources covers a ~1.5km strike length, we believe substantial resource growth is possible. Red Pine currently trades at a discount to peers (C$36/oz vs. peers at C$66/oz), which does not appear to reflect the project’s exploration upside. We believe that as Red Pine continues to demonstrate the potential of the Wawa gold project through its ongoing exploration program, it should help close the valuation gap to peers. read more


Tuesday, April 04, 2017 Derek Macpherson

Radisson Continues to Deliver Drill Joy

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Radisson Mining Resources (TSXV:RDS) announced positive drill results from two additional holes at its O'Brien gold project in Quebec. Exploration results from the volcanics, in our view, are likely to expand the existing resource, along the western edge. As well, the company announced plans to start a second drill later this week, testing recently identified targets in the Pontiac sediments. We view the progress positively, as the company continues to expand resources in the volcanics and exploration success in the Pontiac sediments have the potential to be game changing for the company. Radisson currently trades at a discount to peers, C$48/oz vs. peers at C$64/oz, which we believe fails to reflect the exploration potential at O’Brien. read more

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