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Wells Fargo and Goldman Sachs proclaim the beginning of a commodity super cycle (1)(2) and…
NevGold (TSXV: NAU) (OTCQB: NAUFF) has financing complete to produce over a million-ounce oxide gold resource with the potential to 4 to 5x their current valuation. (3)
NevGold Begins Trading on The OTCQX Best Market
Finding the next multi-million-ounce deposit in Nevada and British Columbia
US inflation is raging and reached 8.5% in March 2022. (5) As a result, experts at Wells Fargo and Goldman Sachs are predicting a commodity super cycle. (1)(2)
Remember that well. Gold has been a store of wealth for thousands of years and it is no different now. Governments and central banks cannot be trusted, and wealth must be protected. Inflation is raging. In the US it accelerated to 8.5% in March of 2022, the highest since December 1981. (4) In reaction, the US Federal Reserve Bank issued the biggest rate hike in 22 years. (5)
At the same time the dollar has risen around 7% against a basket of currencies in the past year to its highest level since March 2020. (6)
For now, investors are flocking to the dollar because the Federal Reserve appears to be tightening more aggressively than any of its major peers. (6) But now is the time to be looking at gold, and specifically gold companies. The train is about to leave the station, and these opportunities should not be missed.
Gary Schlossberg, global strategist at Wells Fargo Investment Institute, however, favors commodities for the longer view. He believes we are at the beginning of a supercycle reflecting underinvestment over the past couple of years.(1)
During the 2000-2011 gold bull market, the price of physical gold rose 550%. While you might think that number is hard to beat, over the same period of time gold mining equities (represented by the NYSE Arca Gold Miners Index) returned more than 690%. (7)
In the current gold bull market which started in 2015, gold mining stocks are up more than 182%, more than doubling gold bullion’s 78% returns.(7)
When the price of gold rises, miners immediately start to see greater profits from selling their ounces on the market. Historically, this has helped to generate exceptional returns.
And that brings us to the incredibly alluring story of NevGold.
NevGold has a very advanced project called Limousine Butte in Nevada. The company is in the midst of a 10,000-meter program which the company is financed to complete. (3)
The financing was completed in June of 2021 for $6.3 million Canadian.(8) With that 10,000-meter program the company will be able to deliver on what is more than one million ounces of oxide gold resources in the mining-friendly State of Nevada. (3)
What makes this extremely exciting is the fact that it’s an oxide gold project. So? Well, that means mining and processing is very low cost and highly economical using the heap leaching processing method.
Heap leaching is the lowest cost form of gold production and makes money in any gold price environment. These types of projects are sought after by the mid and large-cap gold producers and tend to be acquisition targets. This is no different for NevGold.
It doesn’t stop there. The initial drill results have focused on two areas within the large 16,556 acres (67 square kilometers) project. NevGold has identified a number of other targets that they will drill, and that provides the upside potential of a multi-million ounce gold resource.
Time will tell, but drilling is off to a great start! (18)
The company is going to spend $2.5 million to $3 million Canadian on this program and take a historical resource of 292,000 ounces and turn it into a MILLION ounces. (10)
Let’s think about this. That’s $2.5 to $3 million Canadian spent, limited dilution, very low cost to print a million-ounce resource. Now that’s real bang for the buck.
NevGold is protected on the downside by low costs with all the tremendous upside potential as gold prepares to enter the predicted commodity super cycle.
Let’s take a look at the numbers.
As of May 11, 2022, NevGold is trading at approximately, $21.9 million dollar market cap. (11)
You can see in the chart below that their peers trade for about $84 per ounce in the ground. If NevGold is able to deliver on that million-ounce marker, at the low end that could possibly add $84 million to the current $21.9 million, which could mean a potential increase of market cap by 4 or 5x.(3)
From a mining standpoint this is one of the simpler stories you can find.
There is no fancy technology that can find gold from outer space. Nothing is dependent on the stars moon and sun being in alignment.
Lately, gold miners have been taking a beating. As of May 11, 2022, even the popular VanEck Junior Miner ETF was down -9.53% year to date. (12)
In the meantime, NevGold is bucking that negative trend and is up during a general market downturn for the junior miners.
As of May 11, 2022, (OTCQB: NAUFF) is up 38.35% year to date.(10) And with everything covered and being up while the general market is down…if that doesn’t make NevGold a company to keep your eye on…what will?
With the success NevGold is having with Limo Butte, they may soon look to increase the drill program to drive towards a multi-million-ounce resource. That could create even more potential upside in the valuation from current levels. Again, time will tell.
The company has about 7.5 million in warrants at .60 that are close to or in the money. Which is another avenue of potential financing. (8)
According to CEO Brandon Bonifacio, “We’ve done this before, and we will do it again. We’ve developed mining projects in Nevada, we know the road map, we know the key suppliers and contractors. And that gives us the right platform to successfully develop projects in an efficient, low-cost manner to the benefit of our shareholders.”
“We have achieved low-cost structures with our contractors, and we are seeing exceptional assay lab turnaround times of 3 to 4 weeks, (19) whereas many companies are seeing 2 to 3 months at the assay lab. This is very important as it drives steady news flow,” he concluded.
CEO Brandon Bonifacio is young and that’s something NevGold is using to their advantage. Brandon comes from Goldcorp, Inc. From 2015 to 2020 Brandon collaborated to help the company conduct $5 billion in asset acquisitions and divestitures. (13)
Brandon worked closely with and learned from the best of the best in the mining industry, and he is applying those principles to the junior mining space. That is something very unique, as he knows the inner workings of the larger companies, and what they are looking for.
Check out this interesting interview with Brandon on Resource Stock Digest:
NevGold is an owner operated model, where the executives are also owners of the business. And not one of them has ever sold a share. How’s that for confidence?!
The path to discovery began in 2015 when McEwen Mining began reconnaissance stage exploration in the area. Drilling by McEwen in 2017 proved the presence of a strong gold mineralizing system that closely resembles Liberty Gold’s nearby Goldstrike Project in Utah. (16) Nevgold acquired its 100% interest from McEwen Mining in June 2021 and will build on the early work completed to aggressively explore this exciting gold discovery. (16)
Historical smelter records from 1959 documents multiple shipments totaling 32.2 tons, averaging 2,638 g/t Ag (77 oz/t) and 1.7 g/t Au. (17) High-grade ore was also reportedly produced from the Ptarmigan Mine, yielding approximately 89,000 oz of Ag, with average grades of 4,215 g/t Ag, 5.4 g/t Au, 0.58% Cu, 0.54% Pb, and 0.13% Zn. This is a bonanza grade silver-gold-copper-lead-zinc project with significant exploration upside. The company will also be drilling the project this year.
Commodity prices across the board had been on an absolute tear – racking up double to triple-digit gains on a week-to-week basis as the sector-wide Supercycle broke new records.
While things have slowed down recently, this could be the calm before the storm.
NevGold appears to be in a prime position to take advantage of the next leg up in the commodity cycle, so it might be a great idea to keep this company on your radar!
US inflation is raging and reached 8.5% in March 2022. (5) As a result, experts at Wells Fargo and Goldman Sachs are predicting a commodity super cycle. (1)(2)
Source 1: https://youtu.be/yIYCRGxoBtU
Source 2: https://youtu.be/vyJwTitFrz4
Source 3: https://nev-gold.com/investors/investor-presentation/
Source 4: https://tradingeconomics.com/united-states/inflation-cpi
Source 5: https://www.cnn.com/2022/05/04/economy/federal-reserve-interest-rate-hike/index.html
Source 6: https://newsofcanada.net/will-a-strong-dollar-prevent-a-soft-landing-from-inflation/
Source 7: https://www.visualcapitalist.com/why-gold-mining-stocks-outperform-gold-bull-markets/
Source 8: https://www.globenewswire.com/news-release/2021/06/24/2252604/0/en/Silver-Mountain-Mines-Inc-Completes-RTO-to-Become-NevGold-Corp-and-Closes-C-6-3M-Financing.html
Source 9: https://investingnews.com/innspired/how-gold-mining-operations-benefit-from-heap-leaching-extraction-technology/
Source 10: https://investmacro.com/2022/04/nevada-junior-drives-higher-on-long-oxide-gold-intercepts-in-nevada/
Source 11: https://finance.yahoo.com/quote/NAUFF?p=NAUFF&.tsrc=fin-srch
Source 12: https://finance.yahoo.com/quote/GDXJ/?p=GDXJ
Source 13: https://nev-gold.com/about-us/executive-team/
Source 14: https://youtu.be/fQnKiOPmPMI
Source 15: https://simplywall.st/stocks/us/materials/otc-nauf.f/nevgold
Source 16: https://nev-gold.com/projects/cedar-wash/
Source 17: https://nev-gold.com/projects/ptarmigan
Source18: https://www.globenewswire.com/news-release/2022/04/06/2417572/0/en/NevGold-Intercepts-0-86-g-t-Oxide-Au-Over-175-2-Meters-And-0-83-g-t-Oxide-Au-Over-126-2-Meters-at-Limousine-Butte.html
Source 19: https://www.caesarsreport.com/companies/nevgold/report-nevgold-the-first-few-holes-at-limousine-butte-are-exceeding-expectations
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COMPENSATION
Pursuant to an agreement between TD Media LLC and NevGold Corp., TD Media LLC has been hired for a period beginning on 05/23/2022 and ending on 07/01/2022 to publicly disseminate information about (NAUFF:US) (NAU:CA) via digital communications. We have been paid fifty thousand dollars USD via bank wire transfer. We own zero shares of (NAUFF:US) (NAU:CA)
(Last updated: 05-24-2022 16:50:42)
