Oct 19, 2018 06:02 pm By Trey Reik, Senior Portfolio Manager, Sprott Asset Management USA, Inc. Over our two decades following global monetary affairs, we have often marveled at default confidence awarded the Federal Reserve. Don’t misinterpret us — the Fed’s power borders on surreal. Seven governors and twelve regional bank presidents set the price of money not only for the world’s largest economy, but through auspices of the dollar standard system, for the entire globe. No matter how practical “don’t fight the Fed” logic has proven over time, it does not diminish the folly that 19 capable and well-supported individuals might possibly price the world’s reserve currency more efficiently than free markets. Record valuations for U.S. financial assets have inured investors to the daunting risks of unwinding eight years of QE and ZIRP. Because such radical monetary policy has never before been deployed, our 19 monetary mandarins, by definition, command no special insight into broad implications of Fed policy normalization. Into this unprecedented monetary vortex steps new Fed Chairman Jerome Powell, a seemingly low-key and forthright communicator bent on rational steps to normalize Fed policy. In this report, we share our perspective that the Fed’s dual policy agenda of simultaneous rate hikes and balance sheet reduction, rather than constituting some sort of scientifically-formulated policy elixir, amounts to little more than glorified brinkmanship — the Fed’s signature policy tool. Events of the past few weeks only serve to support our contention that Fed tightening is pinching global liquidity to a degree which threatens reigning valuations of traditional financial assets.
EMERGING MARKETS
In our June report, we highlighted a May 8, 2018 speech delivered by Fed Chairman Powell at an IMF-sponsored conference at the Swiss National Bank in Zurich. At the time, we observed that Chairman Powell made specious claims in suggesting “the role of U.S. monetary policy is often exaggerated,” especially with respect to its impact on emerging market [EM] economies. Among his most curious assertions, Chair Powell alleged,
“Monetary stimulus by the Fed and other advanced-economy central banks played a relatively limited role in the surge of capital flows to EME’s in recent years. There is good reason to think that the normalization of monetary policies in advanced economies should continue to prove manageable for EME’s. Fed policy normalization has proceeded without disruption to financial markets…”
It was in reading these patently disingenuous assessments that we first recognized our seemingly mild-mannered Fed Chair is actually on a determined crusade to roll back (what he perceives as) over-zealous accommodation of his predecessors, hell or high water. Chair Powell even noted in his Zurich speech that Fed policy normalization is likely to break a few things along the way.
“All that said, I do not dismiss the prospective risks emanating from global policy normalization. Some investors and institutions may not be well-positioned for a rise in interest rates, even one that the markets broadly anticipate.”
As recently as October 8, 2018, St. Louis Fed President James Bullard weighed in to ratify the Powell doctrine that EM disruptions in the wake of Fed tightening will be exceptions to the rule of better preparedness.
“We do want to take into account international developments. However, I think that what has happened, let’s say in 2018, has been limited to countries that have special circumstances attached to them.”
Well, through October 12, 2018, EM currency declines (versus USD) now measure 49.24% for the Argentine Peso, 35.33% for the Turkish Lira, 14.71% for the South African Rand, 13.19% for the Indian Rupee, 12.86% for the Russian Ruble and 12.50% for the Brazilian Real. While the Fed may attribute these FX performances to “special circumstances,” we would counter that these six countries total roughly 10% of global GDP and 25% of the world’s population. For a quarter of the world’s population, we suspect the “special circumstances” most top-of-mind are significant hits to collective purchasing power and quality of life now being inflicted by the Fed’s latest policy reversal.
NEUTRAL RATE
In mid-September, Fed stewards began to float the possibility that the FOMC’s short-term neutral rate might exceed its long-term neutral rate (3% in current dot plot). In a September 12, 2018 speech, entitled “What Do We Mean by Neutral?” Fed Governor Lael Brainard opined,
“It appears reasonable to expect the shorter-run neutral rate to rise somewhat higher than the longer-run neutral rate. These developments raise the prospect that, at some point, the Committee’s setting of the federal funds rate will exceed current estimates of the longer-run federal funds rate.”
Governor Brainard cited fiscal stimulus (tax cuts) and heightened risk appetite (rich financial asset valuations) as economic conditions potentially supportive of a higher short-term neutral rate. Following Governor Brainard’s lead, Chair Powell espoused the temporarily-higher thesis in his September 26, 2018 FOMC press conference remarks, “Maybe we’ll be raising our estimate of the neutral rate and we’ll just go to that, or maybe we’ll keep our neutral rate here [making a precise gesture with both of his hands] and then go one-or-two rate increases beyond that.” Why would Fed Governors suddenly propose temporarily hiking rates above long-term targets so painstakingly established in prior dot plots? We contemplate two opposing explanations. Perhaps the Fed fears fiscal stimulus and tight labor conditions are combining to spur steeper-than-desired inflation. Alternately, the Fed may be recognizing that its dual policy agenda is pinching global dollar liquidity to an unacceptable degree, and, in preparation for imminent policy downshift, is jawboning markets to accomplish desired long-end tightening the Fed has so far failed to engender. While only time will tell, we view probabilities of these opposing interpretations far differently than current consensus!
NEW SHERIFF
Displaying escalating self-confidence typical of Fed Chairs, Mr. Powell raised a few eyebrows in a speech to the National Association for Business Economics in Boston. In his prepared remarks, Chair Powell credited “better conduct of monetary policy over the past few decades” for having greatly reduced the impacts of tight labor markets on inflation. [Huh?] In the same speech, Mr. Powell asserted that the Fed’s balance sheet runoff is “working very well.” The following day, in an interview with PBS’s Judy Woodruff, Chair Powell stumbled into a classic central-banker trap in proclaiming, “There’s no reason to think this cycle can’t continue for some time, effectively indefinitely.” Then, in response to a question about the FOMC’s removal of the phrase “accommodative” from its September assessment of monetary conditions, Chair Powell may have finally jumped the shark in proclaiming,
“Interest rates are still accommodative, but we’re gradually moving to a place where they will be neutral. We may go past neutral, but we’re a long way from neutral at this point, probably.”
Whoa! With this much global debt outstanding, “a long way from neutral,” equates to, “a bridge too far,” for financial asset prices. Immediately following Chair Powell’s October 3, 2018 comments, 10-year Treasury yields popped to seven-year highs (3.234% on October 5, 2018) and the S&P 500 Index slumped 6.7% in six trading sessions (to a October 11, 2018 close of 2,728.37).
WHAT JUST HAPPENED?
On Wednesday, October 10 and Thursday, October 11, the Dow Jones Industrial Average shed 1,377 points. What the heck? Did anyone see this coming? Well, just as February’s equity-market dislocation was dismissed as ill-fated gamma at a handful of inverse VIX ETF’s, October’s air pocket is now being pinned on “computer-driven option gamma hedging.” The good news is that by Friday (October 12, 2018), JP Morgan Chase global derivatives analyst Marko Kolanovic saw clear to proclaim “the majority (70%) of the systematic selling is behind us.” Unfortunately, Barclays Capital’s Maneesh Deshpande quickly countered that “volatility-control and risk-parity funds may need to sell billion of equities over the next couple of days,” on top of a likely billion in sales by exchange-traded-fund investors. At the risk of self-impeachment, we wonder, “Exactly which tea leaves are these guys reading?” Conceding our limited grasp of Greek variables in contemporary markets, we proffer two pedestrian explanations for this past week’s equity-market swoon. First, following a well-established pattern, October weakness occurred directly in the middle of the Q3 blackout for share buybacks (generally two weeks prior to quarter-end through two days after earnings release). It is getting tough to ignore the fact that equity markets are increasingly vulnerable to dislocation when the undiscerning spigot of share-buybacks is turned off. Second, Fed policy may simply be too tight to maintain current financial-asset valuations. As we have suggested, with this much debt in the global financial system, reigning asset prices cannot withstand rising interest rates (of either the long or short variety). Perhaps President Trump summed things best (October 10, 2018):
“The Fed is making a mistake. I think the Fed has gone crazy. The Fed is going loco and there’s no reason for them to do it.”
In our estimation, a cogent analytical framework for evaluating the impact of Fed tightening on global dollar liquidity is maintained by Sprott colleague, Andy Lees (Macro Strategy). On a daily basis, Andy calculates the U.S. dollar value of global money supply. In the context of the dollar-standard system, especially with .5 trillion in offshore dollar-denominated debt, it is the dollar value of global money supply which truly matters in evaluating global liquidity conditions. As Andy logically explains,
“In a 2-country world, say Europe and the States, if Europe doubled its money supply, then all other things being equal, as the euro would halve, there would be no change in the dollar value of world money supply. On the other hand, if Europe doubled its real GDP, again all other things being equal, then as its dollar purchasing power would rise, the dollar value of world money supply would rise by 50%.”
In the wake of this past week’s market volatility, the dollar value of world money supply has now declined .691 trillion or 4.29% from its April 2, 2018 high. Perhaps more relevant, a 60/40 portfolio of the MSCI World Net Index and JP Morgan Global Aggregate Total Return Bond Index has now declined an annualized 1.89% over the past six months and an annualized 5.36% over the past three months. The 60/40 allocation peaked slightly later than the dollar value of global money supply, but is clearly following the same path. In Andy’s words,
“The fall [in the 60/40 global portfolio] highlights what is happening at the real economy level, inferring that U.S. rates are too strong for the world, and that the world’s ability to service its dollar debt or buy oil and other dollar goods is falling. It would appear therefore that President Trump is correct to say that the Fed has over tightened, at least in the context of global growth…”
We may be talking our own book, but it is interesting to note that analysts of Andy’s pedigree are beginning to focus on the April 2018 period as a potential tipping point for the impact of Fed tightening on global liquidity. We wholeheartedly agree!
U.S. AS BASKET CASE?
A topic of current financial market debate is a fundamental assessment of the recent back-up in 10-year Treasury yields (from an August 24, 2018 low of 2.81% to a October 5, 2018 high of 3.23%). At the risk of oversimplifying, we would suggest Treasury prices are under pressure because there are not enough buyers to absorb exploding Treasury supply. At some point (perhaps already), Chair Powell’s bravado about levitating neutral rates will run smack into global disenchantment with the rapidly deteriorating U.S. fiscal position. It is one thing for our foreign creditors to pitch-in to bridge our gnawing federal budget deficit, but quite another to do so while the Fed is actively promoting a rising U.S. rate structure. U.S. gross national debt rose by .27 trillion during the 2018 fiscal year to .52 trillion (105.4% of GDP). This increase was 33% higher than billion average-annual-growth between 2011 and 2017. Including fixed-rate, intra-governmental obligations, total 2018 interest on the U.S. federal debt measured billion, or roughly .5 billion every calendar day. As shown in Figure 1, the floating interest burden on the public portion is beginning to surge geometrically on the heels of relatively modest interest rate increases. Figure 1: Average Interest Rate on U.S. Public Debt vs. Trailing Twelve Month Sum of Total Interest on U.S. Public Debt. Source: Meridian Macro. Date: January 31, 1984-September 30, 2018. Despite recent upticks in GDP, the U.S. Treasury reported on October 15, 2018, that the 2018 federal budget deficit surged 17% during fiscal 2018 to $779 billion. Even more troubling, current Treasury estimates peg the 2019 deficit at .85 trillion! In a mid-September report, Bank of America Merrill Lynch ranked 45 global economies by the quality of their domestic finances, measuring twin deficits (current account deficit plus federal budget deficit) as a percentage of forecast 2019 GDP. Among the 45 ranked countries, the U.S ranked fifth from worst, with domestic finances in better shape than only Argentina, Turkey, Brazil and Pakistan. Treasuries anyone? With all due respect to the gallantry of our crusading Fed Chair, global capital flows are signaling Fed policy is already too tight, and by extension, the U.S. dollar’s tepid 3.4% YTD 2018 performance is actually too strong to facilitate overseas U.S. funding needs. Morgan Stanley currency strategist Hans Redeker nails these points in a September 23, 2018 Bloomberg interview:
“Widening dollar-supportive yield differentials should be seen in the context of rising capital import needs. We believe the current yield compensation offered by the U.S. is no longer adequate to attract sufficient foreign funds to cover U.S. capital import needs. The dollar has to decline to attract international funds to the U.S.”
BINGO!
In our addenda, we update a chart we have shared in the past, outlining the tight historical correlation between the U.S. dollar and the federal budget deficit. Tying into Mr. Redeker’s comments above, we reproduce in Figure 2, the even tighter correlation between the exploding federal budget deficit and the sinking percentage of U.S. dollar-denominated global FX reserves. Foreigners are generally proved prescient when first jumping ship. Figure 2: U.S. Federal Budget Deficit versus U.S. Dollar Percentage of Global FX Reserve. Source: Meridian Macro. Date: January 1, 2005 – October 15, 2018.
We offer a final visual we feel best captures the Sisyphean task Chair Powell faces in his quest to roll back eight years of FOMC largesse. Ironically, the petrol of Trump tax cuts is now fueling GDP growth which the Fed is interpreting (we believe mistakenly) as sufficient cover to normalize policy. Figure 3 dramatizes the resulting anomaly that the Fed is tightening directly into the teeth of an exploding federal deficit. It is literally only a matter of time before one of the two forces depicted in Figure 3 reverses course with a vengeance. We would suggest wagering on the sudden reversal of the surging federal deficit is the losing proposition. Figure 3: U.S. Federal Budget Deficit versus Federal Funds Target Rate. Source: Meridian Macro. January 1, 1996 – October 15, 2018.
WHAT ABOUT GOLD?
During the next few months, we expect asset markets to come to terms with grossly misplaced investor faith in the sustainability of the Fed’s dual policy agenda of simultaneous rate hikes and balance sheet reduction. Should our suspicions prove correct, it is interesting to note that not only is consensus positioning diametrically opposed to our views, this positioning is also off the charts in terms of its unanimity. As shown in Figure 4, aggregate spec short positions in spot gold, VIX, and 2-, 5- and 10-YR Treasuries are completely unprecedented. What could possibly go wrong here?
Figure 4: Aggregate Net-Short Speculator Positioning on COMEX for Gold, VIX Index, 2-, 5- and 10-YR Treasuries. Source: Meridian Macro. Date: January 1, 2005 – October 12, 2018.
A common institutional apprehension over gold’s portfolio merits is fear that gold and gold equities will prove vulnerable to any sharp downdraft in U.S. asset markets, so why bother with gold in the first place? This logic no doubt stems from “what happened last” reasoning tied to the 2008 market experience. In the fall of 2008, gold succumbed to broad financial asset deflation. We would suggest market conditions for gold in 2018 bear little resemblance to those in play back in 2008. Commodities were perhaps the hottest hedge fund theme on the planet during 2008, exceeded only by ubiquitous shorts in U.S. financials. Complicating matters, the hedge fund community was wildly leveraged on London-based (non Reg-T ) “total return swap” platforms, routinely extending 4-to-1 credit for standard portfolios. Most forget that on September 19, 2008, the SEC stunned the world in enacting a “temporary emergency action to prohibit short selling in [U.S.] financial companies to protect the integrity and quality of the securities market and strengthen investor confidence.” Translation being, hedge funds which were correctly and massively short U.S. financials were forced to cover these shorts and, by way of risk management, liquidate offsetting long positions across the commodity spectrum. Given the brutal and sustained collapse of broad commodities since 2014, we would suggest commodity positioning in 2018 is virtually opposite that of 2008. Further, when proverbial “detritus” next hits the monetary “fan,” the U.S. dollar is unlikely to enjoy anywhere near the safe harbor bid it commanded in 2008, when the Fed’s balance sheet measured a svelte billion, or just 22% of its currently bloated profile. Interestingly, during the 1377-point, 5.2% decline of the Dow Jones Industrial Average on October 10 and 11, spot gold rose 2.9%. Even more impressively, the venerable Philadelphia Stock Exchange Gold & Silver Index (XAU) soared 7.84% over the two-day span. Suffice it to say, these divergent performances herald far different market conditions for precious metals in 2018 than those existing in 2008.
Addenda
Figure 5: DXY Dollar Index vs. 12-Mos. Federal Budget Deficit. Source: Meridian Macro. Date: January 1, 2009 – October 15, 2018.
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Sophisticated investors often follow gold price in US dollar. This is despite the fact that the biggest buyers of gold for wealth protection purposes are in the Middle East, South Asia, and South-East Asia. These buyers do not think in US dollar terms. It is hard to believe, but the Middle East peaked economically in the 1970s–it has been going downhill ever since. I call them the Third World, for they failed to change culturally despite having access to financial resources. In fact, in the Middle East (and recently in Turkey, and increasingly in Malaysia and Indonesia) fanaticism grew exactly when they were becoming rapidly rich. Having failed to develop positive cultural underpinnings, the Third World’s growth rate is falling and social instability is rising. China is the only exception. The real problem of today is not in the USA or its currency (which are clearly showing signs of improvement, for now), but the Third World. As the problems of the Third World become more recognized, I expect gold demand to rise.
I give my views on the reality of the economies, with charts and statistics, of the Third World in the linked article. On investments… A combination of the lack of faith in the junior mining business and the approaching tax-loss selling has resulted in another fall in share prices. Here are companies that I am hoping to buy:
FPX Nickel (FPX; C$0.08)
Amarillo Gold (AGC; C$0.25)
VR Resources (VRR; C$0.17)
Salazar Resources (SRL; C$0.11)
Chalice Gold Mines (CXN; C$0.13)
Renaissance Gold (REN; C$0.16)
Kangaroo Resources (KRL.ASX; A$0.12)
Nkwe Platinum (NKP.ASX; A$0.076)
Keras Resources (KRS.LON; £0.0031)
Avrupa Minerals (AVU; C$0.05)
Altus Strategies (ALTS; C$0.045)
Energold Drilling (EGD; C$0.24)
GFG Resources (GFG; C$0.25)
Nevsun Resources (NSU; C$5.70)
Some people might wonder why I am suggesting NSU. There is still >5% upside left in it. If I make 5% in two months, it amounts to annualized 34% profit (Expected closure date of the merger: 31st December 2018). If for any reason the closure date of NSU merger gets delayed by even a single day, I expect the share price to increase on such a news and then fall again early next year. This pathology exists because of the way taxation is structured. Understanding this pathology might help make some extra money. Warm regards,
Disclaimer: All information found here, including any ideas, opinions, views, predictions, forecasts, commentaries, suggestions, or stock picks, expressed or implied herein, are for informational, entertainment or educational purposes only and should not be construed as personal investment advice. While the information provided is believed to be accurate, it may include errors or inaccuracies. The sole purpose of these musings is to show my thinking process when analyzing a stock, not to provide any recommendation. I will not and cannot be held liable for any actions you take as a result of anything you read here. Conduct your own due diligence, or consult a licensed financial advisor or broker before making any and all investment decisions. Any investments, trades, speculations, or decisions made on the basis of any information found on this site, expressed or implied herein, are committed at your own risk, financial or otherwise.
Original Source: https://www.nsrltd.com/wp-content/uploads/2018/10/Pogo-Resource-Update-Final-16-10-2018.pdf Millrock Resources shareholders should note the following press release by Northern Star Resources regarding the Pogo Gold Mine. Millrock Resources has assets in line with the mineral trend of the Pogo Gold Mine, which may be of significance with the new press release issued by Northern Star Resources. The value proposition for Millrock Resources continues to reward committed shareholders. We have been active buyers that current share prices of TSX-V: MRO | OTQCX – MLRKF. For Information Contact: Melanee Henderson Investor Relations Direct: 604-638-3164 Toll Free: 877-217-8978 Email: mhenderson@millrockresources.com
VANCOUVER, Oct. 19, 2018 /PRNewswire/ – Pacton Gold Inc. (TSXV: PAC, OTC: PACXF, FSE: 2NKN) (the “Company” or “Pacton“) is pleased to announce the first discovery of gold nuggets on the Golden Palms property (E 47/3810), (Figures 1 & 2). The nuggets were discovered by a prospecting crew working in advance of a geological exploration and mapping team.
This gold nugget discovery, within a 300 meter by 300 meter area, is significant in that it represents the first gold discovery on the Golden Palms tenement and has greatly expanded the known nugget-bearing potential of the South Egina area. This new discovery is located approximately 2.5 km northwest of the recently announced Friendly Creek gold nugget discovery (Pacton News: Oct 15, 2018), and occurs across the regional structural and stratigraphic fabric of the underlying bedrock geology.
View photos
Figure 1. Location map of Pacton tenements in the Egina Area. (CNW Group/Pacton Gold Inc.)
The gold nuggets, which show various morphological shapes and textures, and which appear to be eluvial remnants liberated from the underlying bedrock by weathering, were collected in an area that is underlain by mafic to ultramafic volcanoclastic rocks. The basaltic rocks are described as similar to the basalts underlying the recent nugget discovery at the adjacent Friendly Creek tenement, except that the Friendly Creek basalts are massive, thick units, while the basalts underlying the recent Golden Palms tenement nugget discovery are mapped as being stratigraphically thinner, and are sparsely interbedded within a massive chert and limestone sedimentary package. Within the sedimentary package, the basalts do outcrop, but are usually covered by a layer of weathered colluvium, as occurs at the sites where the Golden Palms nuggets were discovered.
The prospective geological gold nugget area covered by Pacton’s South Egina project is large, poorly explored, and consists of an 8 km thick volcano-sedimentary system which extends for approximately 10 km along strike, in a NE-SW orientation, across the adjacent Golden Palms, Friendly Creek and Hong Kong tenements, (Figure 2).
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Figure 2. Golden Palms and adjacent Pacton tenements. Mineralized Mesoarchean basal unit, Western Australia MINEDEX gold occurrences, and location of recent gold nugget discoveries (circle). (CNW Group/Pacton Gold Inc.)
The nuggets and/or mineralization shown in Figure 2 are selected samples and are not necessarily representative of mineralization hosted on the Property.
About Pacton Gold
Pacton Gold (PAC: TSXV; PACXF: US, FSE: 2NKN) is a well-financed Canadian junior with key strategic partners focused on the exploration and development of conglomerate-hosted gold properties located in the district-scale Pilbara gold rush in Western Australia.
The technical content of this news release has been reviewed and approved by Peter Caldbick, P.Geo., a director of the Company and a Qualified Person pursuant to National Instrument 43-101. The qualified person has not yet verified the data disclosed, including sampling, analytical, and test data underlying the information or opinions contained in the written disclosure.
On Behalf of the Board of Pacton Gold Inc.
Alec Pismiris Interim President and CEO
This news release may contain or refer to forward-looking information based on current expectations, including, but not limited to the Company achieving success in exploring its properties and the impact on the Company of these events, including the effect on its share price. Forward-looking information is subject to significant risks and uncertainties, as actual results may differ materially from forecasted results. Forward-looking information is provided as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances. References to other issuers with nearby projects is for information purposes only and there are no assurances the Company will achieve similar results.
Neither TSX Venture Exchange, the Toronto Stock Exchange nor their Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
James Pettit, CEO of Aben Resources, in conversation with Maurice Jackson of Proven and Probable, discusses his company’s summer exploration in the Golden Triangle and how the company plans to keep the momentum going throughout the year.
Canadian Explorer Reveals Year-Round Plan to Maintain Momentum Contributed Opinion
Source: Streetwise Reports (10/19/18)
James Pettit, CEO of Aben Resources, in conversation with Maurice Jackson of Proven and Probable, discusses his company’s summer exploration in the Golden Triangle and how the company plans to keep the momentum going throughout the year.
Maurice Jackson: Joining us today is James Pettit, the president, CEO and director of Aben Resources Ltd. (ABN:TSX.V; ABNAF:OTCQB). In our last interview, we discussed the next unanswered question for Aben Resources and that would be drill results. This week Aben Resources issued a press release conveying some intriguing results. Before we begin, for someone new to the story, who is Aben Resources and share with us the names and location of your three projects beginning with your flagship. James Pettit: Aben Resources is a gold exploration company based out of Vancouver listed on the TSX Venture Exchange. Our flagship property is the Forrest Kerr property. It’s in the Golden Triangle, which is a region of northwestern British Columbia, which has got a tremendous history for high-grade discoveries, the likes of the Snip mine and the Eskay Creek mine discovered 30 some odd years ago. Eskay at the time was one of the highest grade mines in the world. Since then, there’s been a lot of discovery that’s happened over the years in terms of more gold, silver and copper. These are still in the development stage. Many of them are waiting for possible higher prices for the commodity, but they’re probably the largest untapped development projects in the world, especially the copper projects. Now specifically with us, with the Forrest Kerr Project, we acquired that ground three years ago, and started assembling it. I put three claim groups together. We chose those because they’re on a major structural feature, which we look at as one of the controlling structural features in that whole Golden Triangle area. It’s called the Kerr Fault and it’s a big, big fault that you can see from space. That is an area you want to be near for discovery potential and then there’s other geologic features that you want to be coincidental to that, and we’re right in between them. We’re in a good area. We’re getting a lot of attention. The market’s certainly paying attention to everything that goes on up there. The most recent new production up there is Pretium Resources’ Brucejack Mine, which is a very high-grade gold mine. That really brought about $2 billion in value to its investors. There’s lots of potential there. We’re excited about it. That’s why we’ve been so concentrated on it. This year we’ve drilled now I think just short of 40 holes. We’ve got 24 to be released still. That’s going to take us through the rest of the year almost. We have another project that’ll get us through the winter because the weather in the Golden Triangle is pretty severe. It’s coastal mountain range right beside the panhandle of Alaska and gets a tremendous amount of rain or snow. It becomes almost impossible to work up there for the winter, unless you’ve got just a huge amount of money and resources to do it. That whole area will be going quiet soon. We have another project called the Chico Project, which is in Saskatchewan, just south of what used to be called the Claude Resources gold mine. It’s been bought by Silver Standard for $337 million. Silver Standard is now called SSR. It acquired the ground between the Chico property and its property, which it bought from Claude Resources. Basically we think we’ve got an extension of what SSR is looking for because SSR’s interest now is to expand the known resource. To keep that mine alive for the next 20 years, it needs to find more of a resource. SSR has got a good resource to start with that itbought, but I think it has probably got five to seven years left. SSR wants to take this further. It’s drilling on the ground between them and us now. It has acquired all the ground. It’s giving us a good model to work with. We’ll go in there in the winter. It’s the best time to drill in Saskatchewan because it’s flat, it’s frozen. The lakes are frozen, so we can access an egress very easily. Essentially, we just put up the camp, bring in the rig, and move the rig with a helicopter if need be, or we skid it. We’ll be going in there in February. That’ll keep momentum going for the company. Then we’ve also got a project up at the Yukon called the Justin, which is tied right on to Golden Predator’s ground, what it calls 3 Aces. We’re right on strike to the 3 Aces structure. We’ve done a little bit of work there this year in terms of trenching with the mechanical backhoe. We’ve got that up to the site by helicopter, and we’re waiting on assays. We’ve spent 10 days doing this. We think we’re sitting right on top of something very similar to 3 Aces, which is a very high-grade epithermal or hydrothermal quartz vein system. It’s very rich. We’ll know when we get the assays. If they come back the way I think, we’ll be setting up a program for next year. That’s a good project to have in the shoulders between the Forrest Kerr or before the Chico mine’s down in the winter. We can’t really get into the Forrest Kerr until June-July, so we can get up into this region in the interim and keep moving them forward. We’ve got three really good projects to work on, but our flagship is definitely Forrest Kerr because the audience is there. It’s an area play. We all love area plays. That’s where we stand right now. Maurice Jackson: Well, speaking of the Forrest Kerr, let’s focus our discussion today on the Forrest Kerr. We have some exciting news; what can you share with us? James Pettit: We have a new zone. We’ve been working and concentrating on the North Boundary Zone, but this season we drilled three holes to the south of the North Boundary Zone. It was a kilometer and a half south. We put in these three holes because we’re trying to buy time, so we could get more assays back because our concentration is the North Boundary Zone and we needed guidance from some of the assays. We did do that, but we decided to drill where we did because there is a geochem anomaly and target that we wanted to test and it was coincidental with an old geophysical survey that showed something promising. Geophysical anomalies are interesting, but certainly not like a geochem where you actually get the gold in the sample and that’s why you’re there. You have a good geophysical and geochem target to work with, and it turned out that we did the right thing. We’ve hit something there. It’s not as high-grade as the North Boundary appears to be, but it’s broad and it’s mineralized. I’ll use the best of the three holes, hole 21. You’ve got almost 380 meters in that hole is well mineralized, primarily gold, from trace level of 0.1 all the way up to 5 grams every interval. The way we set it up, it’s almost like a graph. You very rarely see that much continuous mineralization like that. Well, it’s a lot of important information about the tenure of mineralization in that region. That’s definitely has our attention. We need to drill more holes there. We’ll get to it next year. The season’s definitely winding down up there right now, but it’s going to give us a lot of info. Plus, we have now flown the entire valley using an EM geophysical survey, which encompasses both boundary zones to the north and south. We’re actually just waiting for the results and the interpretation of the survey. We’ll take that information at increased amount of geochem sampling that we’ve done, as well as all the assay results that we’ll have for the season. We’ll use that and compile some significant information for next year and work up our next series of targets. Maurice Jackson: This is quite intriguing, exciting, any adjective you like to associate with it. Congratulations, sir. Now prior to this week’s press release, Aben Resources was able to successfully complete a financing and secured a major shareholder. Share the details with us, sir. James Pettit: The first hole we put out this year was spectacular. It had an interval of 10 meters of roughly 38 grams. I mean that’s spectacular in itself, but within that was six meters of 62 grams gold. That’s like two ounces. Spectacular results. That got the market’s attention. The stock really moved up. The interest for financing was immediately apparent. We did announce a $4.2 million financing and half of it was taken by a fellow named Eric Sprott, who is a bit of a gold legend. He started Sprott Securities, which now has a big presence in Toronto and also a big presence in Carlsbad, California. He is the consummate and ultimate gold bug. He loves gold and is not afraid to take a big stand in an early-stage deal like this. This is the exploration phase. This is potentially where you can absolutely make the most. You’re in at a price that seems very cheap and the market cap is low and you have this discovery. From that point on, you want to keep it growing and the market reacts correspondingly. He’s well aware of that. He’s not afraid to take a shot. He does it with a number of companies. But when he gives his blessing to it, it’s pretty substantial. Then we also raised another million dollars after that largely because his name was now attached to the original financing, so we raised another just short of a million dollars flow through. The company now has just over $7 million. We’ve basically got next year’s program paid for. Maurice Jackson: That leads to my next question, what is the burn rate and does Aben Resources plan to return to the market in the foreseeable future for another financing? James Pettit: Well, the second question’s answer is no, we won’t. We don’t need to. Our burn rate varies from where we are in the area if we’ve got things on the go, the drill program, etc., our burn rate, and I’m just talking about basically our G&A and marketing burn rate, that can grow to $200,000 a month. Then the field work is always budgeted. This year we had budgeted about $1.5 million and we increased it by about $1 million. This year all in all we spent about $2 to 2.2 to 3 million. I haven’t got the finals number in. That’s all in for that project. We doubled the size of the drilling program. We’re getting really close to shutting down, but I don’t see it going over that. For the G&A side, the operations of the office in Vancouver in marketing because we do. It’s important to spend money on marketing. We travel a lot marketing this project. That runs about $200,000 and varies up to $250,000 a month. Then when we aren’t working, everything obviously slows down, but then we are still marketing because we want people to know what we achieved. We always have goals. We want the market to understand we’re achieving the goals. I think that’s quite important. Maurice Jackson: Indeed it is. Switching gears onto management. Aben’s management team has a proven pedigree of geological and business acumen. I want to focus on potential amalgamations in the sector should this occur. Share some of the past successes of management rewarding their shareholders on previous arbitrage successes. James Pettit: Sure. Well, our chairman Ron Netolitzky, he’s like a serial M&A guy. The market really watches what he does. In the past, for example, he was in on the discovery of Snip and Eskay Creek up in this area. He’s got a very, very big following of people all over the world who have followed him through his career and starting there. He’s also very successful in Saskatchewan as well, specifically in M&A, Eskay and Snip. Snip was sold to Cominco way back and then Eskay ended up in Barrick’s hands. Since then, there’s Copper Canyon, which he and Tim Termuende, who’s also on the board, sold that to Novagold and that became part of the Galore Creek Project, which is now in the hands of Teck and Newmont. My background, even though I’m not a geologist, is I started a company called Bayfield Ventures and eventually sold it in 2014 to New Gold as part of its Rainy River Project. The three of us have a pretty good background of what’s required. We’re always in contact. We maintain contact with majors all the time. I think given what’s happening in the Golden Triangle, majors are coming back. They’re starting to look again. Last year Goldcorp did a deal with Colorado Resources just on a financing basis, $7 million. That was a surprise move, but it shows the interest I think. Osisko’s looking around there. Kinross is looking in the area. Barrick has showed its interest again. I think they actually have a buy back into the Snip deal because Skeena has got their hands on it and they’ve been working on it and trying to resurrect another zone in the Snip Mine. That’s our background. I think it stands out to be honest with you with the amount of M&A that’s been done between the three of us. Maurice Jackson: Talk to us about the share price. The market is rewarding value speculators. James Pettit: Absolutely. This is the level to enter in this market. Speculators want to be involved with a company that’s active, has good projects, good people, etc. Then take a position and wait for them to do what they say they’re going to do. In our case, last year was the discovery of the North Boundary Zone. This year was the reaffirmation of it with a tremendous hole that you could really say is the discovery hole. We need to make it bigger now. That’s our job. That’s where you get this big appreciation in stock price based on speculation. Then going forward as you put out more and more results, the market will go up and down and follow the results. I’m seeing that this year as opposed to last year, which was as soon as you finished drilling or came out with results and you got too late into September going into October, that market’s sold off. It just sold off because tax loss season is coming and they just wanted to be out of whatever they were doing. Because once you’re finished, it’s a long cold winter to get through and you’re sitting on a stock. Like last year, we went back down to $0.10. That’s not going to happen this year because I’ve got two other projects that are good and we’ve got a really good shareholder base now. We have so much liquidity this season. We ran from roughly $0.10, maybe $0.12 up to $0.50. Now it’s settled back in the low to mid $0.20s now. It’s trading good volume. I think probably since July or beginning of August we’ve traded 150 million shares. That’s fantastic. Maurice Jackson: That’s quite impressive actually. Yes. James Pettit: It’s really very impressive. We put out a bunch of holes before this most recent one around that discovery zone. They were less impressive. They were really good. They’re all very well mineralized. They just weren’t 30 some odd grams. Those that wanted that to be repeated sold out and that just meant there’s a whole lot of people who came into the market that they sold out, other people bought it. We’ve got a really good floor here, the $0.20 to $0.25 range. I think basically it’s a buy all day long. We still got 24 holes to put out. Maurice Jackson: Yeah. We’re one of those other buyers. Speaking of the stock price, if I may just interject here, Warren Buffett and Rick Rule, they’re noted for sharing how the market rewards speculators that are prepared. In particular, and I’m going to paraphrase them, that you should not purchase a stock if you weren’t willing to see the price reduce 30% or more and be willing to purchase more. Now we’re on record, we purchased Aben Resources at $0.42 and we’re active buyers at current prices and we’re confident that the value proposition in our opinion continues to increase. Mr. Pettit, before we close, multilayered question here, what is the next unanswered question for Aben Resources, when should we expect results, and what determines success? James Pettit: The next unanswered question really would be how big is this and how robust is this boundary zone, including north and south. So far we’ve tapped into two zones. The very first priority target we had was the North Boundary Zone. Well, it generally was the boundary zone and we started in the north end and boom, hit it right away. When we prioritized the target zone, this overall property, the Forrest Kerr, we did it based on a compilation study of all the historic data. We came up with about 12 areas we want to go test. We’re still on the first one. Two years later we’re still in the first one. This boundary zone is four kilometers long and two kilometers wide. It’s all based on geochem. There’s a big geochemical survey that’s been done there. We’ve added to it now and now we’ve completed the airborne. We could be there for a while. I think we’re just touching on it now. We’ve hit a few sweet spots. One’s confirmed as a sweet spot, the South Boundary Zone. I think by next year when we do some more holes we’re going to be surprised, but I think there’s going to be a lot more sweet spots there. We’re going to focus and vector in on where did this mineralization come from. That’s really what our job is. Figure it all out, get the structure identified and where it came from. We know there’s at least three mineralizing events in the area, and we know there’s at least four ages of rock. That tells us there’s been four major events that have happened. With three of them, in came the fluids that brought the gold. Let’s find some of those feeders. Maurice Jackson: Well, Mr. Pettit, we’ve covered the good. What keeps you up at night that we don’t know about? James Pettit: Keeps me up at night? Well, being a good sleeper, not much keeps me up at night. Being in this business so long, I’m used to it. There’s always risks. What would scare me is we hit nothing for the rest of the holes. That would be a concern. I don’t foresee that. As long as everything stays on course, we’re good. I don’t really have a concern that would keep me awake at night. Maurice Jackson: The last question I have for you, sir, is what did I forget to ask? James Pettit: Most people ask me where do I think we’re going to go with what’s remaining this season? Obviously, I don’t have results. I don’t know, but I think we’re going to be pleasantly surprised. I think things are looking good. I think we’re in the right area for sure. Absolutely the right area. This is a very robust mineralizing system that we’re looking at. We’re right between the two big structural systems that we want to be in. I think for a discovery profile, we’ve got a really good one. Maurice Jackson: Mr. Pettit, for someone listening that wants to get more information on Aben Resources, what is the website address, sir? James Pettit: The website address is www.abenresources.com. Maurice Jackson: As a reminder, Aben Resources trades on the TSXV symbol ABN, and on the OTCQB symbol ABNAF. For direct inquiries, please contact Don Myers at 604-639-3851. That number again is 604-639-3851. He may also be reached at info@abenresources.com. As a reminder, Aben Resources is a sponsor of Proven and Probable and that we are proud shareholders of Aben Resources for the virtues conveyed in today’s message. Last but not least, please visit our website www.provenandprobable.com where we interview the most respected names in the natural resource space. You may reach us at contact@provenandprobable.com. James Pettit of Aben Resources, thank you for joining us today on Proven and Probable. Maurice Jackson is the founder of Proven and Probable, a site that aims to enrich its subscribers through education in precious metals and junior mining companies that will enrich the world. Disclaimer: Proven and Probable LLC receives financial compensation from its sponsors. The compensation is used is to fund both sponsor-specific activities and general report activities, website, and general and administrative costs. Sponsor-specific activities may include aggregating content and publishing that content on the Proven and Probable website, creating and maintaining company landing pages, interviewing key management, posting a banner/billboard, and/or issuing press releases. 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YOU SHOULD NOT MAKE ANY DECISION, FINANCIAL, INVESTMENTS, TRADING OR OTHERWISE, BASED ON ANY OF THE INFORMATION PRESENTED ON THIS FORUM WITHOUT UNDERTAKING INDEPENDENT DUE DILIGENCE AND CONSULTATION WITH A PROFESSIONAL BROKER OR COMPETENT FINANCIAL ADVISOR. You understand that you are using any and all Information available on or through this forum AT YOUR OWN RISK.” All Rights Reserved.
Vancouver, British Columbia, October 19, 2018 (Globe Newswire) – Irving Resources Inc. (CSE:IRV) (“Irving” or the “Company”) is pleased to report it has sampled high-grade quartz vein float at its 100%-controlled Omu gold-silver project, Hokkaido, Japan (Figures 1, 2 and 3). While following up stream sediment anomalies (please refer to Irving’s news release dated January 3, 2018 for further details), Irving geologists identified banded quartz vein and other pieces of mineralized float along recently constructed logging roads in areas around the historic Hokuryu mine. Logging roads often provide the only geologic exposure in this heavily vegetated terrain. Inquiries made by Irving with the Hokkaido prefectural forestry agency and local logging road constructors confirm no exotic material was placed on these roads and all road base material is locally derived. Therefore, Irving believes quartz vein float material reported in this news release is derived from nearby bedrock. Samples of quartz vein float collected along a one-kilometer long west-northwesterly trend beginning approximately 700 meters west of Hokuryu mine are particularly noteworthy. Results include: Quartz vein float samples from Hokuryu West-
Sample ID
Au (gpt)
Ag (gpt)
Au (opt)
Ag (opt)
OM-HT003
35.2
568
1.13
18.26
OM-HT004
3.5
102
0.11
3.28
OM-HT005
59.8
1245
1.92
40.03
OM-HT006
36.3
1000
1.17
32.15
OM-HT007
155
617
4.98
19.84
OM-HT009
138.5
500
4.45
16.08
OM-HT010
2.9
180
0.09
5.79
OM-HT011
8.5
53
0.27
1.7
OM-RH028
39.7
708
1.28
22.77
OM-RH030
20.3
342
0.65
11
OM-RH032
39.5
671
1.27
21.58
OM-RH044
8.2
47
0.26
1.51
OM-RH046
21.6
457
0.69
14.69
31.1 gpt = 1 opt
Samples in this table are of select float and not necessarily representative of mineralization at Hokuryu West
In addition, Irving geologists collected seven samples of variably altered and silicified volcanic rock and breccia with gold values ranging from 0.14-0.53 gpt and silver values ranging from 3-19 gpt. Irving believes the “West Hokuryu” area may host extensions of the Hokuryu vein system. Hokuryu mine, owned by Nihon Mining Company, Ltd., operated briefly beginning in around 1928 until it was shut in 1943 due to the Gold Mine Closure Act near the end of WWII. It produced approximately 2.8 tonnes Au and 11.5 tonnes Ag during its short life. (MMIJ. 1990. Japanese Gold Mines Vol. 2 Hokkaido. The Mining and Materials Processing Institute of Japan (MMIJ)). In an area approximately 2.5 km southwest of Hokuryu mine, a sample of quartz vein float returned 20.8 gpt Au and 59 gpt Ag and two samples of silicified and quartz-veined volcanic rock returned 1.78 and 0.68 gpt Au and 19 and 24 gpt Ag. One sample of quartz vein float collected approximately one km northeast of Hokuryu mine returned 7.14 gpt Au and 41 gpt Ag. Six samples of variably silicified and quartz-veined volcanic rocks from areas north, northeast and east of Hokuryu mine returned 0.03-2.50 gpt Au and 0.5-57 gpt Ag. Samples discussed above are of select float and not necessarily representative of mineralization in this area. Irving is currently conducting further prospecting in vicinities around Hokuryu mine and to the north where there are historic reports of high-grade veins. Follow-up soil sampling and geophysical work is currently being planned at Hokuryu West. “We are encouraged by results from select float samples collected around the historic Hokuryu mine,” commented Akiko Levinson, President and Director of Irving Resources Inc. “Right now, we are conducting further prospecting, sampling and baseline soil sampling at Hokuryu West. Next season, we plan to conduct more advanced exploration including soil sampling and geophysical work similar to that done at our Omui mine and Omu sinter target areas.” Drill contract signed Irving recently signed a diamond drilling contract with Rodren Drilling Ltd., Winnipeg, Manitoba (“Rodren”), to undertake diamond drilling at its Omu project. A diamond drill is currently being mobilized to Hokkaido and is expected to reach Omu in approximately two weeks. Although necessary permits are still awaited, Irving, Mitsui Mineral Development Engineering Co., Ltd. (MINDECO) and Rodren are concurrently working on necessary staffing for a drill program. Further information about timing of commencement of drilling will be made available when more information is in hand. All samples discussed in this news release were collected by Irving geologists from float, loose rock in soil, believed derived from subcropping bedrock and veins. They are not necessarily representative. Irving submitted rock samples to ALS Laboratory, Vancouver, BC, for analysis. Au and Ag were analyzed by fire assay with gravimetric finish. Multielements were analyzed by mass spectrometry following three acid digestion. Lab standard and blank samples were utilized for quality assurance and control. Quinton Hennigh (Ph.D., P.Geo.) is the Qualified Person pursuant to National Instrument 43-101 responsible for, and having reviewed and verified, the technical information contained in this news release. Dr. Hennigh is a technical advisor and director of Irving Resources Inc. About Irving Resources Inc.: Irving is a junior exploration company with a focus on gold in Japan. Irving also holds, through a subsidiary, Project Venture Agreements with Japan Oil, Gas and Metals National Corporation (JOGMEC) for joint regional exploration programs in the United Republic of Tanzania, the Republic of Malawi and the Republic of Madagascar. JOGMEC is a government organization established under the law of Japan, administrated by the Ministry of Economy, Trade and Industry of Japan, and is responsible for stable supply of various resources to Japan through the discovery of sizable economic deposits of base, precious and rare metals. Additional information can be found on the Company’s website: www.IRVresources.com. Akiko Levinson, President & Director For further information, please contact: Tel: (604) 682-3234 Toll free: 1 (888) 242-3234 Fax: (604) 641-1214 info@IRVresources.com Forward-looking information Some statements in this news release may contain forward-looking information within the meaning of Canadian securities legislation. Forward-looking statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, without limitation, customary risks of the mineral resource exploration industry as well as Irving having sufficient cash to fund any planned drilling and other exploration activities. THE CSE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE. (Figure 1: Map showing the location of recently sampled areas around the historic Hokuryu mine.) ( Figure 2: Gold assays from recently collected float samples around the historic Hokuryu mine. A one-kilometer long west-northwest trend of high-grade quartz vein samples is particularly noteworthy and may represent a significant extension of the Hokuryu vein network.)
(Figure 3: Silver assays from recently collected float samples around the historic Hokuryu mine. A one-kilometer long west-northwest trend of high-grade quartz vein samples is particularly noteworthy and may represent a significant extension of the Hokuryu vein network.)
VANCOUVER, British Columbia, Oct. 19, 2018 (GLOBE NEWSWIRE) — Novo Resources Corp. (“Novo” or the “Company”) (TSX-V: NVO; OTCQX: NSRPF) is pleased to announce that its OTCQX-listed common shares are now eligible for electronic clearing and settlement through the Depository Trust Company (“DTC”) in the United States.
DTC is a subsidiary of the Depository Trust & Clearing Corporation, a U.S. company that manages the electronic clearing and settlement of publicly traded companies. Securities that are eligible to be electronically cleared and settled through DTC are considered to be “DTC eligible”. DTC eligibility is expected to simplify the process of trading and enhance liquidity of the Company’s common shares on the OTCQX.
About Novo Resources Corp.
Novo’s focus is to explore and develop gold projects in the Pilbara region of Western Australia, and Novo has built up a significant land package covering approximately 12,000 sq km. For more information, please contact Leo Karabelas at (416) 543-3120 or e-mail leo@novoresources.com
On Behalf of the Board of Directors,
Novo Resources Corp.
“Quinton Hennigh”
Quinton Hennigh
Chairman and President
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Don Luskin likes what he sees. The economy, he says, is strong and poised for growth. The tax cuts are working, particularly in the small cap segment. Furthermore, the President’s approach to trade negotiations is sound. In short, Keynesian animal spirits for risk are back and the future looks bright. But, he adds, “Don’t be an idiot about it. Like in a plane, you always want to know where the exits are.” The Chief Investment Officer of Trend Macrolytics recently visited our Southern California studio for a wide-ranging discussion on politics, central banks, trade wars and markets. It was my first opportunity to sit down with the author and columnist, who is also a regular on Fox Business Network. For starters, there is no mistaking it: Luskin is an uncompromising stock bull. The economy, he insists, “… is in a cusp period, where the world has the potential to get out of the era of secular stagnation, and the new normal, and get back to growth rates and productivity rates that look like the old normal.” He is also not shy about his support of the President’s economic policy and, in particular, tough stance on China and trade. “China is interfering with free trade more than we are,” he explains. In Luskin’s assessment, the pros of Trump’s tough stance outweigh the cons, even if the tactic means higher consumer prices for Americans. “[Free trade is] the morally right thing to do,” he adds. Yet, despite his unwavering optimism, when pressed, Luskin concedes that diversification is a worthy end in itself. Don’t be an idiot about it — remember the plane analogy? But what if the nearest exit is behind you — like at Dow 26,000? “Believe me … I own lots of gold,” he admits. “I also have lots of guns and ammunition … and penicillin.” After all, what good is an exit without a parachute? To watch the video interview with Donald Luskin, chief investment officer of Trend Macrolytics, click here. To download the Trend Macro special report, “One Sell-Off, So Many Causes” click here (pdf) Read in browser »
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Original Source: https://www.stockpulse.com/inside-the-markets-stock-market-plummets-what-it-means-for-precious-metals-with-maurice-jackson Today the stock markets were down significantly in the U.S. Have the bubbles begun to pop? And if so, what assets still remain on sale? Fortunately Maurice Jackson of Proven and Probable joined the StockPulse network to explain the value propositions that currently exist, the opportunities in the mining sector, and what’s really important for investors to be aware of right now.
VANCOUVER, Oct. 17, 2018 /PRNewswire/ – Pacton Gold Inc. (TSXV: PAC, OTC: PACXF, FSE: 2NKN) (the “Company” or “Pacton“) is pleased to announce it has signed a Memorandum of Understanding (“MOU“) with Artemis Resources Limited (ASX: ARV, FSE: ATY, USOTC: ARTTF) (“Artemis“), an Australian Securities Exchange listed exploration company, to enter into a strategic processing alliance (“Alliance“).
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Figure 1: Bulk sampling previously conducted on Friendly Creek Mining Lease (CNW Group/Pacton Gold Inc.)
Highlights of the Transaction:
Permitted processing facility provides potential of rapid advancement of Pacton’s projects through substantial bulk sampling and production scale testing of gold mineralization.
Pacton’s multiple mining leases held across a number of projects provides a rapid pathway for trial mining to be undertaken.
Project scale review underway across entire portfolio to identify opportunities for near term production from both conglomerate and shear hosted mineralization styles.
The MOU contemplates collaboration between the two companies, whereby Pacton can utilize Artemis’ 100% owned Radio Hill processing plant, located 30 kilometres from the city of Karratha, on a non-exclusive basis. The Alliance provides Pacton with the potential to bulk process conglomerate and shear hosted mineralization from Pacton’s multiple mining leases and therefore opens a rapid pathway to production.
Under the terms of the MOU, Artemis and Pacton will seek to work collaboratively to determine how they can together advance, or leverage off, Artemis’ Radio Hill operations and processing infrastructure. Commercial terms for any processing arrangement remain subject to negotiation in a formal agreement.
“The strategic processing alliance with Artemis provides a far reduced upfront capital cost of evaluating near term development opportunities within the Pilbara. Pacton’s extensive land holding in the Pilbara contains a multitude of prospects requiring evaluation. Through Pacton’s granted mining leases in conjunction with the processing solution provided by Artemis, the alliance partners are well positioned to expedite development opportunities,” commented Alec Pismiris, Interim President and CEO of Pacton Gold. “We look forward to working closely with Artemis, an established long term operator in the Pilbara region and strive to capitalize on the operating synergies between both parties.”
About Pacton Gold
Pacton Gold (PAC: TSXV; PACXF: US, FSE: 2NKN) is a well-financed Canadian junior with key strategic partners focused on the exploration and development of conglomerate-hosted gold properties located in the district-scale Pilbara gold rush in Western Australia.
On Behalf of the Board of Pacton Gold Inc.
Alec Pismiris Interim President & CEO
This news release contains or refers to forward-looking information based on current expectations, including, but not limited to the Company achieving success in exploring its projects and the impact on the Company of these events, including the effect on its share price. Forward-looking information is subject to significant risks and uncertainties, as actual results may differ materially from forecasted results. Forward-looking information is provided as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances.
Neither TSX Venture Exchange, the Toronto Stock Exchange nor their Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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Figure 2: Pacton Regional Project Location Plan & Artemis Radio Hill Processing Facility (CNW Group/Pacton Gold Inc.)
