2024.12.19

Storm Exploration’s (TSXV:STRM) CEO Bruce Counts knew he was onto something when he found a gold property in the Ontario government database that showed exceptional historical drill results.

Storm now has four properties in northwestern Ontario, a jurisdiction that has produced over 200 million ounces of gold. See the slide below for production details and locations. Three of Storm’s properties are located in the Fort Hope area, home to a greenstone belt with the potential to host a major gold camp.

High-grade gold has been confirmed by drilling at a number of locations on Storm’s flagship property, Miminiska. Historical assays include 5.75 g/t Au over 20.84m and 13.95 g/t Au over 5.32m, with mineralization hosted in Banded Iron Formation.

Miminiska currently has two main targets: Frond and Miminiska. Outcrops on the shores of Lakes Frond and Miminiska were discovered in the 1940s, but so far only minor drilling has been done.

Storm Exploration optioned the property from Landore Resources in 2021.

“It took quite a while to land these properties but I felt very strongly that they were exceptional. In all that research I’d been doing I really hadn’t seen historical results like these. This is an area with proven gold endowment that has seen limited exploration work; but more than that, I was drawn to the deposit type: Banded Iron Formation hosted gold,” Counts said earlier this week.

Banded Iron Formations

Banded Iron Formations account for around 60% of global iron reserves, and can be found in Australia, Brazil, Canada, the United States India, Russia, Ukraine and South Africa.

The gold in banded iron is associated with greenstone belts believed to be ancient volcanic arcs, or in adjacent underwater troughs.

Greenstone belts often contain gold, silver, copper, zinc and lead ores.

The gold is usually found in cross-cutting quartz veins/ veinlets, or as fine disseminations associated with pyrite, pyrrhotite and arsenopyrite.

The host strata has generally been folded and deformed.

Banded Iron Formations have several characteristics that make them significant for juniors that own them, and producers that want to acquire them. First, they tend to be high grade / high margin deposits that have large gold inventories, often in the multi-million-ounce range. In addition, the grades tend to be consistent (not nuggety), meaning that they are easier for explorers to define and for producers to predict the ounces that will be mined. Finally, the metallurgy of BIF hosted gold deposits generally tends to be simple. This makes for excellent gold recovery and a less complex processing circuit to recover the precious metal. 

Miminiska

Counts said the Miminiska project bears all the hallmarks of a Banded Iron Formation hosted gold deposit. The closest analog is Musselwhite, located ~115 km to the northwest which has historically produced more than 6 million ounces of gold grading 5.3 g/t  and recently sold for $850m. The geometry of the Miminiska target is similar to that of the past producing Lupin BIF mine in Nunavut, which produced 3.4Moz at 9.1 g/t Au before closure in 2005.

Of Storm’s three properties in the Fort Hope area, Miminiska has seen the most drilling, making it the obvious choice for an initial drill program, which is scheduled to begin in early 2025, subject to financing.

Historical drilling on the Miminiska target totals approximately13,000 meters — enough to compile an 80,000-ounce resource. Notably, this resource is non 43-101-compliant, meaning it cannot be relied upon for investment purposes. Still, it provides a ballpark estimate of how much gold has already been discovered with very limited drilling.

Counts said he thinks the gold endowment at Miminiska can quickly be expanded vertically and laterally through drilling.

“We feel confident that we can expand the gold inventory very quickly and without a lot of expense,” he told me on Tuesday, Dec. 10, adding “The Miminiska target has the potential to host a multi-million-ounce deposit all on its own and it is only a small part of the 5500 ha property.”

The Miminiska property hosts two banded iron formation hosted gold targets separated by 12km: Miminiska in the west and Frond in the east. While drilling has been completed on Miminiska, the Frond target also boasts compelling historical drill results, including 12.54 g/t over 3.8m. In addition, limited exploration drilling in the 1980’s identified gold bearing BIF between Miminiska and Frond, making the entire property prospective for this type of rich gold deposit.

BIFs are different from shear-hosted gold systems. A shear hosted system tends to host a “sheet” of gold; however, in Banded Iron Formations, explorers are looking for a series of “rods” or “shuts” that plunge deeply underground.

Counts notes that drilling at Miminiska has mostly been confined to the top 150m of the system. An important question is, could the zones run deeper? Counts gives the example of the past-producing Lupin Mine, where gold was mined at 9 grams per tonne from surface to a depth of 3,600 meters.

In 2022, Storm Exploration performed an electromagnetic survey over the Miminiska target to determine the conductivity of the known gold zones — something that had never been done before.

“We were excited to see that the known gold zones produced a very strong electromagnetic response and that there were similar responses in undrilled areas of the BIF,” said Counts, who describes the target as “folded into a Z pattern with the best gold results along the northern limb. What we found is that similar conductivity signatures exist elsewhere along that northern limb and into the nose of a fold. (see map below)

“The nose of the fold may be very important. There’s no guarantee that it will host a lot of gold,” he said, “but in many instances that is the sweet spot. At Miminiska, the nose has never been drilled and it has a fantastic conductivity signature that mimics where gold is known to be present. We have a lot of conviction that we’ll be able to expand the gold along that arm and into the nose which will allow us to grow the gold inventory very quickly.”

As mentioned, the drill program in the New Year is dependent on financing. In September the company launched a non-brokered private placement at $0.05 per unit that so far has raised $500,000. Another raise will likely take place in February or March.

Storm has also brought on John Williamson as a strategic investor and technical advisor. A gifted and successful geologist, Williamson helped develop Founders Metals’ Antino project in Suriname — which recently attracted an $8.8M investment from B2Gold; and was part of the team that discovered the Back River deposit in Nunavut, a Banded Iron Formation hosted gold deposit that B2Gold acquired from Sabina Gold & Silver in 2023.

Could Williamson’s experience with Banded Iron Formations be a factor in bringing him into the company? It seems like a safe bet.

“John has a great deal of experience working with Banded Iron Formation hosted gold deposits and he is familiar the Miminiska project. There is no question that he has a lot to contribute technically,” Counts said. “But more than that, John is a serially successful entrepreneur, which will be important in marketing and fundraising,” he continued.

Counts said the goal is to raise $1.5 million through flow-through shares which will allow Storm to drill about 3,000 meters of core.

“That’s plenty of meters for us to really convince the market that the Miminiska target has great gold endowment and room to grow into a multi-million-ounce deposit. All the foundational work has been done and the project is ready for drilling,” he concluded.

Storm Exploration Inc.
TSXV:STRM
Cdn$0.04 2024.12.13
Shares Outstanding 52.1m
Market cap Cdn$2.5m
STRM website 

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Richard (Rick) Mills
aheadoftheherd.com
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Richard does not own shares of Storm Exploration Inc. (TSXV:STRM). STRM is a paid advertiser on his site aheadoftheherd.com

This article is issued on behalf of STRM

2024.12.17

Kodiak Copper (TSXV:KDK, OTCQB:KDKCF, Frankfurt:5DD1) was established by chairman Chris Taylor of Great Bear fame. The founder and CEO of Great Bear Resources presided over its acquisition by Kinross Gold in 2022 for $1.8 billion.

Kodiak, a Discovery Group company, is led by Claudia Tornquist, previously a general manager at Rio Tinto, working with Rio’s copper operations. She was also the former director of Kennady Diamonds, leading the $176M sale of the company to Mountain Province Diamonds.

Kodiak, GT Gold and Copper Mountain analogs

Comparing Kodiak Copper to GT Gold (TSX.V:GTT) and Copper Mountain Mining (TSX.V:CUM) is interesting from an investor’s perspective. Would an investor have made money if they had got in early enough, before the stock price rose following publication of key milestones — a resource estimate in the case of GT Gold and commercial production, actually the restart of an old mine, for Copper Mountain Mining?

The Copper Mountain mine site is located approximately 15 km southwest of Princeton, British Columbia. The deposit was mined by underground methods between 1923 and 1957. Open-pit mining commenced in 1968 and the mine closed in 1996. It was re-opened in June 2011.

A technical report dated Sept. 11, 2008, shows an estimated resource of 260.22 million standard tons at 0.357% grade above cut-off of 0.2%, (measured and indicated), and 164Mt at 0.290% grade above cut-off in the inferred category.

A historical stock chart of Copper Mountain Mining shows the most dramatic price increase when the mine started production in June 2011. The stock price ran from about $1.00 a share in 2008-09 to an all-time high of $8.25 in May 2011 — a month before the mine re-opened.

An investor who bought the stock in early 2008 for $1.00 would’ve had good reasons to hold it, based on the fact that it was a brownfield (previously mined) operation that could be put back into production relatively easily with the right management team and at the right copper price.

Indeed the historical copper price chart below shows a tight correlation between CMMC’s share price and the price of copper. Copper dropped suddenly in 2008 from $3.94 on April 7 to $1.29 on Dec. 22, likely due to the financial crisis. It makes sense, then, that the release of Copper Mountain Mining’s technical report in September 2008, including a new resource estimate based on 2007 drilling, didn’t move the stock price.

The release of an updated resource in early March 2009, 20% above earlier estimates, also failed to incite share buying. According to the above chart, CMMC was trading at just $0.53 then.

A good entry point for investors who bought the mine restart narrative.

Two years later, copper was back up to $3.95. In fact Copper Mountain’s restart of the mine in June 2011 was well-timed. It corresponded to a copper price of $4.10 that month, only 44 cents away from the Feb. 7, 2011 peak of $4.54.

An investor who had bought the stock any time before 2010 would’ve had ample opportunity for price appreciation. Acting on the updated resource estimate with a buy in March 2009, continually averaging in, and holding  until mine re-opening would have rewarded an investor with a homerun sized gain. 

Our conclusion? When a mine re-opens, resource estimates and other technical reports may serve as weaker catalysts than the copper price, which is logical given that the mine’s production and profit potential are directly related to price performance, but when investors see the cash flow ‘light at the end of the tunnel’ significant stock price gains can be made.

In June of 2023 Copper Mountain Mining was sold to Hudbay Minerals for close to CAD$600 million. The operation is now 75% owned by Hudbay and 25% by Mitsubishi Materials.

GT Gold (TSXV:GTT)

GT Gold began exploring its Tatogga project in northwestern BC in 2016. The Saddle South discovery was prospective for gold and silver. While drilling over the next two years outlined a strong mineralized system, it was the much bigger but lower-grade Saddle North porphyry copper-gold deposit that piqued a major’s interest.

A 2017 discovery hole at Saddle North cut 210 meters averaging 0.16% copper, 0.14 grams per tonne gold and 0.28 g/t silver. The grades got stronger the deeper the hole went.

A 2018 hole that undercut the 2017 discovery hit 822 meters averaging 0.26% Cu, 0.42 g/t gold and 0.62 g/t — confirming that the junior was onto a large porphyry reminiscent of the Red Chris mine about 20 km to the southeast.

Intrigued, Goldcorp grabbed an early 10% stake (like Tech has done with KDK), spending CAD$17.9 million in 2019. An additional $8.9M boosted Goldcorp’s stake to 14.9%. (Newmont acquired Goldcorp on April 18, 2019).

With Newmont’s backing, GTT continued to explore Saddle North, resulting in a maiden resource estimate in July 2020.

Based on 41 drill holes, Saddle North hosted 298 million tonnes of indicated resources averaging 0.28% Cu, which translated into 1.81 billion pounds of copper, 3.47 million ounces of gold and 7.58Moz of silver. Inferred resources were 543 million tonnes averaging 0.25% Cu, yielding 2.98 billion pounds of copper, 5.46Moz of gold and 11.64MOz of silver.

Less than five years after its founding, GT Gold and its Tatogga project was bought out by Newmont, which spent $393 million to acquire the 85.1% of GTT’s shares it didn’t already own.

GT Gold is an example of a company with huge potential to make big money for investors who got in early.

From the chart below, an investor who bought GT Gold for $0.51 in July 2017 and held on until the 2017 Saddle North discovery would have quintupled (5X) their investment. The stock bumped along between $0.50 and $2.50 for the next two years; it was $2.18 at the time of the resource estimate in July 2019 — testing the mettle of investors who had held the stock during the first and second discovery phases when the stock reached peaks of $2.75 and $2.11.

Smart investors though who saw the potential would have bought on the dips and on positive news releases. Those who saw the chance for a takeover by Newmont would have been rewarded handsomely when it happened on March 10, 2021 with Newmont offering $3.25 a share.

The investor who got in at $0.51 and sold at the buyout price of $3.25 would have realized a 537% gain.

Conclusion

Investing in junior mining companies isn’t for the faint of heart, nor the “get rich quick” crowd. It takes time, skill and perseverance to identify a company, do your due diligence, and then have the faith and PATIENCE to stay with it through the often-bumpy ride from discovery to buy-out, or in the case of Copper Mountain Mining, from resource estimate to restart.

If management thinks it’s light on tonnage, KDK will do more drilling to build more critical mass. It won’t stop until it builds enough tonnage to potentially interest a major.

GT Gold proves that a junior can make money by putting out a resource estimate, as can investors who play the game right. It wasn’t until Newmont paid $393 million to acquire 85% of the shares it didn’t own that the stock really took off, from $1.92 to $3.21 on March 10, 2021. That’s a 67% gain, but very few investors would have bought and sold on the same day. The most handsomely rewarded would have been those that got in four or five years earlier at <0.50 cents to $1.00.

We see no reason why investors won’t do very well for themselves owning KDK; in our opinion, it’s an example brought to you by AOTH, of what patient investors, who actually know how to invest in this sector, are paying attention to.

Kodiak’s management team, and the Discovery Group, have a successful, an envious, track record of shareholder returns.

Copper market fundamentals are currently strong, with analysts predicting increasing demand facing the headwinds of structural supply deficits.

A key focus of Kodiak’s 2024 drill program was to identify additional near-surface and high-grade mineralization. Drill results from the Adit Zone to date have clearly achieved this.

The holes significantly extend the copper envelope at Adit and when combined with historical drilling, Kodiak’s new results have outlined a sizeable near-surface, high-grade area of mineralization.

Kodiak Copper’s MPD project has all the hallmarks of a major copper/gold porphyry system with the potential, in my opinion, to become a world -class mine. 

Kodiak Copper
TSX.V:KDK, OTCQB:KDKCF, Frankfurt:5DD1
Cdn$0.41 2024.11.29
Shared Outstanding 75.9m
Market cap Cdn$32.7m
KDK website

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Richard (Rick) Mills
aheadoftheherd.com
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Richard does not own shares of Kodiak Copper (TSX.V:KDK). KDK is a paid advertiser on his site aheadoftheherd.com This article is issued on behalf of KDK

2024.12.10

On May 13, 2024, Max Resource Corp (TSXV:MAX; OTC:MXROF; Frankfurt:M1D2) announced that it had entered into an Earn-In-Agreement (“EIA”) with Freeport Exploration Corp, a wholly owned-affiliate of Freeport-McMoRan Inc. (NYSE:FCX) relating to Max’s wholly owned Sierra Azul Copper-Silver Project. Under the terms of the EIA, announced on May 13, Freeport can earn an 80% interest in the Sierra Azul Copper-Silver Project in two stages by spending an aggregate CAD$50 million and paying a total CAD$1.55 million to Max.

Max Resource Executes Earn-In Agreement with Freeport-McMoRan Exploration Corporation for the Cesar Copper-Silver Project

Max in October closed the transaction to purchase the Florália DSO Iron Ore Project, located 70 km east of Belo Horizonte, Brazil. The transaction closed pursuant to a mineral rights purchase agreement entered into with the company’s Brazilian subsidiary, Max Resource Brazil Ltd. (Max Brazil and, together with the company, the “Max Entities”) Jaguar Mining Inc. (TSX:JAG), and Jaguar’s Brazilian subsidiary, Mineração Serras Do Oeste Limitada (together with Jaguar, the “Jaguar Entities”). 

Max Resource Announces Closing of Transaction to Purchase 100% of the Florália Hematite Iron Ore Project in Brazil

Florália DSO Iron Ore Project

“The Florália DSO Iron Ore open pit reveals sizable, sub-horizonal plunging bands of hematite iron ore which appear to extend in all directions. Upon successful exploration and development, with iron ore buyers situated within 20 km, Florália would have a significant transportation cost advantage, as bulk tonnage haulage to a shipping port would not be required,” said Max’s CEO, Brett Matich, in the Oct. 11 news release.

(High-grade hematite (60% Fe) such as Florália is often referred to as Direct Shipping Ore (DSO) because it is mined and beneficiated using a relatively simple crushing and screening process before being exported for use in steel mills. The appeal of DSO lies not only in its high iron content but also in small environmental footprint, lower greenhouse gas emissions from dry processing, no requirement for water or environmentally sensitive tailings dams.)

Florália is within Brazil’s Iron Quadrangle, which hosts some of the largest iron mines in the world.

As mentioned by Matich, it is also within 20 km of major iron ore mines and steel mills, seen on the map below. Local mining infrastructure includes railways, haul roads, mining services and personnel.

Brazil is the world’s second-largest producer of iron ore, at 16% of global production. Most of the country’s iron ore mining (53%) takes places in the state of Minas Gerais, home to Florália.

Minas Gerais is Brazil’s second-highest producer of cast products in steel, iron, aluminium, bronze, and tin, with installed capacity of

2 million tons per year.

The state offers a highly skilled workforce, competitive energy prices, and a fast-tracked permitting system that makes it easier for miners to get projects off the ground.

“The government is keen to attract investment into the state, and they’ve made huge strides in streamlining the environmental licensing process,” says Mauro Lopes, international partner with Invest Minas, via Paydirt magazine. “The state is also very competitive in terms of energy costs, offering 100% renewable power at just 4c/kWh — far cheaper than in places like Australia.”

Australia is the largest iron ore producer but the Australian government taxes it at a higher rate than Brazil, taking a 7.5% royalty versus Brazil’s 3.5%. This is another advantage for Max.

Most iron-ore mining is done on surface in open pits. At the dry processing plant, the iron ore is crushed and screened, a classification process, into various size fractions to meet the required specifications.

The iron ore market is forecast to increase by USD$57.5 billion between 2023 and 2028 for a compound annual growth rate (CAGR) of 3.2%.

The World Steel Association forecasts global finished steel consumption to increase by 1.9% in 2024.

Rising demand for high-strength iron and steel, coupled with industrialization across developing nations and a booming construction sector, are driving this explosive growth.

While there has been a slowdown in China affecting iron ore demand, the Asia Pacific region is estimated to contribute 89% to the growth of the global iron ore market from 2023-28.

High-strength steel and green steel are promising new markets for iron ore mining companies.

Deutsche Bank has brushed off signs of oversupply in iron ore markets, suggesting China’s stimulus package could rocket prices of the steelmaking ingredient to $USD130/t next year.

Max announced on Nov. 15 the addition of a wholly-owned Australian entity, Max Iron Brazil Ltd., which will hold the Florália Brazilian assets. The company plans to list on the ASX and to do a pre-listing financing to fund the proposed transaction and to advance drilling. 30 million shares are being offered for AUD0.10 cents (Australian) per share.

A Feasibility Study and environmental study are expected by the end of 2025.

“If you’re a junior iron ore player this project has everything you could hope for,” Matich told Paydirt. “High-grade hematite DSO, strong local demand, minimal infrastructure requirements, and a management team with a proven track record. It’s as simple as that.”

Max Resource Provides Update on its Florália Hematite Iron Ore Project, Mina Gerais State, Brazil

A lot of work has already been accomplished, results from various surveys undertaken are impressive.

Max reports high-resolution drone magnetics at Florália has identified a large anomalous zone of surficial outcropping high-grade mineralization associated with hematite/itabirite type iron formation. The size of the anomalous area has far exceeded the approximate 160m by 160m historic open cut to around 1,500m by 1,000m based on the drone magnetics, field activities and 58 channel samples.

Max’s technical team has reviewed the new drone magnetics and channel sampling data and has significantly expanded the Florália DSO geological target from 8 to 12 million tons at 58% Fe to 50 to 70 million tonnes at 55% to 61% Fe, with an additional itabirite geological target of 130 to 170 million tonnes at 51% to 55% Fe.

The processed geophysical data from the drone survey also indicates a large portion of the magnetic anomaly lies at depth below the surface expressions of high-grade hematite oxide mineralization. Analysis indicates a highly deformed structural geological environment that is fundamental to the increase in iron ore grades and tonnages, a consequence of secondary crystallization of hematite and the development of supergene enrichment.

Additionally, the geophysical survey was also crucial in revealing the potential of a secondary body covered by soil in the northwest portion of the property. This zone was initially regarded as a minor occurrence; however, the magnetic signature and orientation recognizes it as extensions to the initial iron formation target.

The magnetometric geophysical survey utilized drones over the project area located in the Florália region of Santa Bárbara, Minas Gerais, Brazil, within the “Quadrilátero Ferrífero” region. The geophysical survey magnetometric maps were generated with multiples filters along with a 3D inversion that provided a high-resolution block model and isovalue surfaces from the interpreted source of the anomalies.

This data has been fundamental in confirming the principal target area and the true potential of the Florália high-grade hematite (DSO) project.

MAX has also completed characteristic ore tests and commenced environment studies and other components of the Feasibility Study (FS) the company plans to complete before the end of 2025. There is no native title on the property, water permits are not necessary so no tailings dam is necessary, and workers/ contractors will not need accommodation on site.

The channel sampling across road cuts is now complete with assays pending. The next step is auger and diamond drilling.

Max Resource Corp.
TSXV:MAX; OTC:MXROF; Frankfurt:M1D2
Cdn$0.045 2024.12.09
Shares Outstanding 179.8m
Market cap Cdn$8.09m
MAX website

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Richard (Rick) Mills
aheadoftheherd.com

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Richard owns shares of Max Resource Corp. (TSX.V:MAX) MAX is a paid advertiser on his site aheadoftheherd.com. This article is issued on behalf of MAX

By Larry Elliott

Things are not quite going according to plan for Rachel Reeves. The economy has contracted for the past two months and inflation is proving hard to shift. The first Labour budget in more than 14 years received a frosty reception. But everything is relative; at least the chancellor had no trouble getting her measures through parliament, which is more than can be said for Emmanuel Macron in France. And if opposition MPs at Westminster were to call a vote of no confidence, Labour’s massive majority means it would be spared the defeat suffered by Germany’s chancellor, Olaf Scholz, earlier this week.

By Bruno Venditti – Visual Capitalist

President-elect Donald Trump has threatened to impose new tariffs on Chinese imports when he takes office next year.

In 2018, during his first term in the White House, Trump initiated a trade war with China by imposing 25% tariffs on imports, including industrial machinery, cars, auto parts, and television cameras. These goods accounted for about $50 billion of the $540 billion the United States spent that year on Chinese-made products.

By Sanjana Gajbhiye – Earth.com

When we talk about the prevention and management of cancer, we don’t usually think that diet changes would be very helpful. But a recent study begs to differ.

The research suggests that dietary changes may play a role in slowing tumor growth in cancer patients.

Experts at UCLA focused on men with early-stage prostate cancer and observed notable differences in tumor progression based on dietary habits.

The findings could pave the way for lifestyle changes to complement cancer treatment strategies.

By Clyde Russell – Reuters

China’s steel output fell in November from October, seemingly another sign of the struggles in the world’s biggest producer of the key metal for construction and manufacturing.

But while November production did drop 4.3% from October, the detail is far more nuanced and the big picture shows China’s steel sector is largely steady, as it has been for the past five years.

Crude steel output in the world’s largest producer was 78.4 million metric tons in November, down from 81.88 million in October, data from the National Bureau of Statistics showed on Monday.

By Dorothy Neufeld – Visual Capitalist

In 2024, global public debt is forecast to reach $102 trillion, with the U.S. and China largely contributing to rising levels of debt.

This marks a $5 trillion increase since 2023 alone. Looking ahead, debt levels are projected to increase faster than previously expected as government policies fail to address debt risks amid aging populations and increasing healthcare costs. Going further, rising geopolitical tensions could lead to higher spending on defense, adding strain to government budgets.

From Mining.com

It’s clear that critical minerals will be China’s weapon of choice in its escalating trade war with the United States.

Every time Washington imposes new restrictions on exports of advanced semiconductor chips to China, Beijing responds by tightening controls on exports of the critical inputs for chip manufacturers.

By Tomer Niv – Forbes

As the global economy evolves, a new arms race is emerging, not in conventional weaponry but in Bitcoin. The world’s most prominent cryptocurrency is now at the center of geopolitical strategies, with nations vying to establish national bitcoin reserves that may redefine their financial sovereignty. In this new “Cold War of Bitcoin,” the United States, Russia, China, Japan, and other countries are staking claims.