1911 Gold (AUMB, TSX-V)
Ron Clayton stepped aside, which is great news as it relates to “marketing” AUMB!
Clayton, a semi-retired mining engineer, had really been kind of a stick in the mud.
Shaun Heinrichs has assumed the CEO role and he’s promised me 2022 is the year 1911 loosens up and starts touting its unique story aggressively.
Trading 36 cents with a $25 million market cap, AUMB remains a compelling Gold stock opportunity. $25 million is only 10% of the mill’s “replacement value” and they’ve consolidated a 90 km greenstone belt for the first time in history.
Heinrichs recently returned from a site visit (Bissett, Manitoba), his first in 2 years. Where Clayton was far removed from site, based in Nevada, Heinrichs’ history with the property/mine dates back to the Klondex days. He’s visited many times and is more well known.
More seriously marketing AUMB couldn’t come at a better time (better late than never) as “Golden Times Are Coming” for the industry. Our view, guided by John’s reliable technical analysis, is that Gold will hit $2,700 (U.S.) over the next 12 months.
Friday’s close was $2,446 in loonie terms, sure to be on a path past $3,000 this year based on the prediction above.
$3,000+ is a price 1911 starts considering underground mining the known deposit at True North plus brownfield drilling around True North.
Since prices are headed there, Heinrichs is already talking about just that.
I don’t think anybody is advocating for rushing back into half-scale mining (e.g., processing half the mill’s 1,300 tpd capacity). However, now’s the time to be studying what that might look like. And it’s going to attract a new crowd of speculators who want AUMBto produce (more than tailings).
Also I like the idea of brownfields drilling. 1911 has been doing a good deal of greenfields drilling these past 2 years (10,000+ m are pending assays), but that’s riskier business. Surely there are targets closer (deeper and/or along strike) to past producing areas. For instance, the 007 Zone, delivered big hits – 60 g/t Au over 3 m, 21 g/t Au over 7 m, 110 g/t Au over 2 m, and 23 g/t Au over 11 m – and it was mined but is it completely mined out?
Unlikely anyone really knows for sure; popping some more holes in and around the 007 Zone might not be a bad idea.
3 drill rigs are currently on site and assays from 10,000+ m drilling are pending.
Drilling will continue into the summer with 5,000+ m minimum following up on best results.
Rice Lake really is an area, like other Archean greenstone belts, offering multi-million ounce discovery potential.
2 to 3+ million have been delineated (or mined) to date but according to Zipf’s Law this is only scratching the surface. Ask around, but Zipf’s Law has some merit with many geologists. It’s been quite accurate in the Abitibi and Archean terranes of Australia (Yilgarn).
Dr. Scott Anderson is a structural geologist and 1911’s exploration manager. He’s been working and studying the Rice Lake belt for decades, so he’s about the most qualified/experienced person you could find.
The question is when will all his hard work and preparation meet luck?
Here’s what Dr. Anderson is excited about lately:
- He’s seeing well developed veins with evidence of complexity within 5 to 10+ m structures in scale with strong alteration associated with it. “This points toward a robust mineral system,” says Anderson
- 1911 has and is seeing these things at both Bidou and Tinney, so they’ve been following up with more detailed drilling at depth and along strike (assays pending)
With a paid for and permitted 1,300+ tpd mill, 1911’s hurdle rate for “discovery” is far lower than about any other exploration company.
250,000 ounces grading 8 grams or more is what they need to move toward commercial production and “filling the mill”.
Geological work thus far has been validated via a new strategic investor (likely Kinross) and based on the number of other industry-player enquiries.
Leaving with a quick look at the technical picture:
For the first time in quite a long time there’s a reason to be bullish on AUMB, based on the chart.
A rising 50 dma just crossed above the 200 dma.
AUMB has been rangebound for more than half a year, basically bouncing between 30 and 40 cents. That’s quite a long time period for consolidation. Based on our outlook for Gold and the underlying fundamentals favoring AUMB, the breakout will be to the upside.
Ought to be a good one, too – only question is when.