Junior Mining Investing Comes Down To One Thing…Making Shareholders $$$

I’ve been showing some charts to readers over the past few weeks urging caution on the overall equity market despite reaching record territory on the Dow and S&P500.  We have had 10 years of a bull market after 2008 which Bernanke and Obama did what they knew best which was to print dollars and increase the money supply.  They may have kicked the can down the road for 10 years but what happens when the next crisis starts?  What bullets does the Fed have left?  Interest rates are already negative?  However, despite all this money printing in the USA, China, Japan and the rest of the world has been devaluing their currencies at much faster rates making the dollar the least stinky fiat currency.

Gold is breaking out pretty much in all currencies.  The US Dollar which has been artificially strong has kept gold below all time highs despite breaking out against pretty much every other fiat currency.  That may change soon as President Trump wants to devalue the US dollar and has nominated someone to the Fed Judy Shelton who believes in a gold standard.  Once the dollar goes lower all the precious metals will move higher dragging silver and copper along.

Despite the markets one can still find the highest quality juniors following up on some of the best results in 2018 for any miner in the world.  For over a year I have highlighted one story in BC in particular even before the metals broke out.  In the early stage exploration sector you have to know the people who can get the job done.  Natural resource investing comes down to being able to make shareholders money.  The way to make money is to have a great team of people working on a great project.  Sure some people can make it once on a deal by sheer luck but if you see a team doing it not once but twice or more than three times then you know they are professionals.

I was involved in their first big win when Newmont came in to buy their asset for over $2 billion dollars right near the end of the last bull market in gold.  I thought I was so smart but little did I realize that it was not easy finding another group like this with so much success.

This group has raised billions of dollars but has returned much more than they raised to shareholders which is so rare and unique in the mining industry.  How have they been able to be so successful even during one of the worst bear markets in mining history?  Its clear that these guys love what they do and are passionate about discovery.  They attract and mentor young talent into the team.

They are so successful that many companies and opportunities come to them which allows them to be very selective in the projects they work on.  They have a scientific formula to find assets and then build teams and companies around these discoveries which generates shareholder value.

Last year this team found an excellent project in Central BC which had over $25 million of work spent on it with over 400 drill holes.  The project had over 400 drill holes with an existing copper resource.  No one really looked at th project in 20 years…it was kind of lost in time.  So the team took the historical work and digitized it into a computerized database.

The group funded the company internally and then brought on a top CEO who is known in BC drilling the discovery drill hole at the Red Chris mine.  Once the company had a top CEO and the new computerized database they then raised $6.5 million to drill in 2018.

Using top geological science led by world experts the drilling resulted in what could be a new disruptive discovery in BC which has caused great excitement among the mining community most notably from Teck Cominco which then came in as a strategic shareholder by investing at a huge premium to the market.  Its an ideal location for a mine in Central BC and can be worked year round.

Two rigs are currently turning with over 30 people on site.  I expect by the end of July news should start and I expect that to continue after September.  With a little bit of blessing and some good science the team hopes to stay up there year round.

There is a lot of interest from the majors in new discoveries in BC.  Newmont bought into the Galore Creek Project where they are spending $275 million to become 50/50 partner with Teck.  Newcrest paid over a billion to buy 70% of the Red Chris mine this year.  South 32 the mining giant has opened an office in BC looking for opportunities.

This company drilling results this year must be watched.  This is very high grade gold, copper and zinc asset in a mining jurisdiction with a rule of law and in a location that can be driven to in an area with nearby mines and infrastructure.   This team has a track record of building wealth not by luck but time and time again through science, passion and hard work.  The timing is excellent now as the program has just started up with news coming in just a couple of weeks possibly following up on best copper drill results in 2018.

To sum up I will quote PI Financial analyst Phil Ker, “The CRD discovery at Stardust…reflects significant exploration upside…remains open up and down plunge…foresee significant upside to build on this exciting discovery…attractive polymetallic high-grade profile.” 15k meter program!

All the best,

Jeb Handwerger

Disclosure:
Author is biased. He owns shares and they are a featured sponsor company. Sponsors are website advertisers so that means author has been compensated and has a conflict of interest to help boost awareness of this story. The content of this article is for information only.  This is not investment advice!