We’ve always believed if you’re going to risk speculative capital on an exploration play, the geologists running the deal better be world class – because that is who you’re betting on.
Over the past several months, we’ve evaluated the global mining and exploration landscape carefully. One discovery has far and away stood out to us above all the rest…
Below is a chart of Novo Resources’ stock price. The explorer’s market cap ran from under $100 million in the spring of 2017 to a high of well over $1 billion in just a few months.
Novo Resources 1 Year Stock Chart
These types of explosive moves (potential 10-baggers in a matter of months) are certainly rare, and when they happen they captivate the small cap market in Canada. Before long, thousands of small cap investors are talking about these types of moves; and it creates speculative optimism, increases the pool of financing capital and often leads to new discoveries.
When looking for the next company to introduce to our subscribers, we cast a wide net with our global network of financiers, geologists and entrepreneurs. Our goal is to bring our subscribers investment opportunities like the one we are about to introduce… but first, some background on Novo, and more specifically its Chairman & President.
The Geologist | Dr. Quinton Hennigh
Quinton Hennigh is a rock star in the junior resource sector, no pun intended. From our conversations with industry pros, he is arguably the hottest geologist in the world at the moment; and its due to the fact Quinton, and Novo, may have made the most significant gold discovery in roughy the past 100 years.
Dr. Hennigh helped start Novo Resources and assemble its Australian exploration portfolio. In July of 2017, the company put out news of a discovery. In short, Novo’s reported discovery began to change the psyche of mineral speculators in Canada, the epicentre of exploration capital, and around the world. Consequently, many now believe Novo has discovered a new, specific type of goldfield in Australia…
Think of a goldfield as an independent trend, such as the Carlin in Nevada. But all goldfields are not created equal. The one Hennigh has discovered in the ‘Land Down Under’ has similar characteristics to South Africa’s Witwatersrand region – home to the most prolific gold fields on earth. This region in South Africa has produced over 1.5 billion ounces of gold, or between 1/2 and 1/3 (depending on who you ask) of all gold ever mined on earth.
We’re interested in the value creation, and the human capital, a man like Quinton Hennigh can bring to the table. For a junior miner worth ten or twenty million, the real ‘blue-sky’ opportunity comes through one thing: potential for discovery. While some bet the horse (the project), we almost always bet the jockey (the President/Chairman and geological team).
Hennigh’s Next Opportunity & Why We are Writing You Today
Upon further review and tapping our network, we were able to start our research early on Quinton’s next deal, and before it recommenced trading (this company will resume trading tomorrow morning at market open).
Furthermore, we found out that some prominent names which invested in Novo Resources have also established a position in Quinton’s new deal.
Quinton Hennigh remains Chairman of Novo Resources; and, unbeknownst to many retail investors, following an acquisition on November 15th, 2017, became Chairman of Miramont Resources…
Miramont Resources (MONT: CSE) – led by Chairman Dr. Quinton Hennigh and Bill Pincus as President and CEO, is our new featured exploration company. Shares in the company will begin trading again on Monday, November 27th.
On November 15th, Miramont Resources reported:
Miramont Closes $6 Million Financing and Acquisition of Puno Gold and Dr. Quinton Hennigh Joins Board as Chairman
Miramont’s main assets are the *Cerro Hermoso and **Lukkacha projects, both of which are located in Peru. Cerro Hermoso hosts a 1.4 km diameter breccia pipe targeting gold – polymetallic mineralization, while the Lukkacha property is targeting a large copper porphyry. Peru is the 2nd largest global producer of copper and the 6th largest producer of gold.
*Miramont has a four year option to acquire 100% of the mining concessions. Surface rights are privately held and the company has reached agreement to access the property and conduct exploration activity.
**Miramont has a four year option to acquire 100% of the property.
The pipe at Cerro Hermoso is similar in structural setting, scale, style of alteration and associated intrusive rocks to Goldcorp’s Penasquito deposit, located in Mexico. Penasquito is one of Goldcorp’s prized assets and was responsible for 24% of the company’s revenue in 2016.
Miramont has been put together to continue where ***Puno Gold (the company it acquired) left off, delineating key targets for their 2018 campaign. Furthermore, the company is cashed up, having just raised $6 million in an equity financing, which included participation from Sprott Capital Partners.
***Details of the transaction are set out in press releases issued by Miramont on June 5, 2017, August 28, 2017 and November 8, 2017.
We will delve into Miramont’s projects shortly, but first, a look at Peru’s mining environment in 2017… sometimes one has to venture outside North America to go big.
It’s hard to think of a country more committed to growing its mining sector than Peru. Check out the gains in Peru’s GDP from the mining sector over the past decade.
In fact, according to Trading Economics, “GDP from Mining in Peru averaged 13471.07 PEN Million from 2007 until 2017, reaching an all-time high of 17268 PEN Million in the third quarter of 2017…”
So, it could be argued Peru has never been more dependent upon its mining sector. In Peru, about 14% of GDP and 60% of all exports are attributed to the mining industry. There is a reason Rio Tinto, Barrick and BHP Billiton all have producing assets in Peru. The Pacific coast nation has well-established shipping routes to Asia as the 2nd largest global producer of copper. Peru is also the 2nd largest producer of silver and, as mentioned, the 6th largest global producer of gold.
Dr. Hennigh’s heart appears to be in hunting elephants as his next targets with Miramont are large, highly prospective plays in Southern Peru…
Both Miramont’s projects are located along a regional trend of mining systems. Check out the massive copper mines, located northwest along trend from Miramont’s Lukkacha Project (below).
First, let’s review Miramont’s Cerro Hermoso Gold Project…
The principal target at Cerro Hermoso is a Volcanic Breccia Pipe bulk tonnage gold and silver target.
What is a Breccia Pipe?
Breccia Pipe Comparison | Penasquito & Cerro Hermoso
To better understand the diatreme style of deposit, Miramont provides a comparison in its corporate presentation…
The two cross-sections below show a comparison of breccia pipes between Cerro Hermoso and the Peñasco breccia pipe; the primary pipe at Goldcorp’s Peñasquito deposit in Mexico.
Note that both pipes intersect a significant limestone layer. Limestone is known to be associated with multi-element deposits. Breccias are thought to be formed at the intersections of fractures. In these areas, hydrothermal activity forces its way to the surface. The immense heat and cooling process creates mineralization.
Goldcorp’s Penasquito Mine has gold reserves (proven and probable) of 8.95 million ounces and produced 465,000 ounces in 2016. Even more, Penasquito contributed 24% to Goldcorp’s total revenue – a stunning statistic.
“Peñasquito is a breccia pipe deposit that developed from intrusion-related hydrothermal activity. Two diatreme pipes, Peñasco and Brecha Azul, are the principal hosts for the gold-silver-zinc-lead mineralization…”
Early examinations of the diatreme complex at Miramont’s Cerro
Hermoso Volcanic Breccia Pipe has been proven to contain gold, silver, copper, lead and zinc. Miramont explains the similarities between the two breccia pipes in its corporate presentation.
“The two pipes are of similar:
* Structural setting
* Style of alteration
* Associated intrusive rocks”
Furthermore, “…suggesting that disseminated Au – Ag mineralization may be found over a long vertical range at Cerro Hermosa.” (pg. 14 Miramont corporate presentation)
According to Miramont,
“Breccia-hosted mineralization is the primary exploration target at Cerro Hermoso where significant values of gold have been reported from previous investigations and confirmed by Miramont geologists. Recent observations by Miramont geologists suggest that gold is carried in veinlets and possibly disseminated into the breccia matrix which could form a bulk-tonnage deposit.”
“The diatreme is a steep-sided, upwardly flaring chimney-like structure that is associated to mineralization at radial mines and veins located at the periphery of Cerro Hermoso. The combination of disseminated Au – Ag with other styles of mineralization in the district indicate a potentially large mineralized system.”
Miramont’s 4 Exploration Targets
According to the company’s website,
“Miramont has identified four types of epithermal gold-silver – copper – zinc-lead exploration targets within and around the diatreme complex, including breccia – hosted disseminated mineralization; carbonate replacement deposits; stockwork hosted bulk – tonnage; and precious base metal veins.”
Let’s quickly break down each target…
1) Primary Target – A 1.4 km diameter Volcanic Breccia Pipe. This is a bulk tonnage gold and silver target. Channel sampling by previous operators of outcropped breccia units yielded:
* 50 meters at 1.12 gpt Au (gold)
* 43 meters at 1.79 gpt Au (gold)
2) Carbonate replacement deposit – Silver and copper limestones at depth altered by contact with igneous rock reported grades as 115g/t Ag, 8.45% Pb and 8.06% Zn.
We asked Miramont President and CEO Bill Pincus to describe this potential target. He stated that,
“Carbonate Replacement Deposits underlying limestone beds, in contact with mineralizing solutions have been converted to sulfide bearing deposits. These are known from old mine reports which describe these. Zinc, lead +/- silver, copper and gold are found in flat-lying deposits. Over 16% combined zinc/lead have been described in Peru. If geophysical results point to the presence of sulfide mineralization this could indicate a significant massive sulfide deposit.”
3) Stockwork hosted bulk tonnage
According to Miramont,
“The stockwork zone at Cerro Hermoso is defined by intense alteration of host andesites and an extensive network of veins and veinlets.”
4) Precious base metal veins. There are five past producing mines on Miramont’s Cerro Hermoso project that surround the outlier of the diatreme complex. The mines have historically been mined to a depth of 300 metres. The Minsur Santa Barbara Mine, for example, operated between 1966 and 1990, milling up to 740,000 tons per day at an average cut-off grade of 450 g/t Ag and 2% Cu, according to Miramont. The Minsur Mine had nine levels and expanded for over 2 kilometres.
According to Miramont,
“Reports indicate that ore grade increased to 3% Cu at depth. This mineralized material was never mined nor explored below. Mine abandoned after cave in.”
Miramont plans to drill an initial 5,000 metres to test the numerous targets. These targets will test the vertical and horizontal extent of this large volcanic system. With year-round accessibility and Peru commencing its summer in December, there is no better time to drill.
Check out the exploration targets outlined below:
N.B. The stockwork zone is located adjacent to the Hb diorite, featured in red above.
Hunting for Elephants in Southern Peru | Lukkacha Copper Project
If Miramont’s only project were Cerro Hermoso, it would still warrant our attention and selection as a featured company. But, the company’s Lukkacha Copper Project is just as compelling…
Lukkacha is located along trend of the largest and most productive copper belt in Peru. Below are the world-class projects discovered on the belt:
3,900 – 450,000 tons per annum copper production
2,075 Mt – 190,000 tons per annum copper production
2,226 Mt – 130,000 tons per annum copper production
950 Mt @ 0.63% Cu
source: Miramont Resources Corporate Presentation
The NW-striking belt of copper deposits is aligned near the Incapuquio Fault and littered with massive mines.
The geologic setting at Lukkacha is similar to the nearby Toquepala Mine Complex, one of Peru’s largest copper mines.
Miramont’s Lukkacha project sits in a classic setting for a major buried porphyry copper deposit.
The company reports in its corporate presentation:
“Typical porphyry alteration (propylitic/phyllic) is well defined over three square kilometers.
Indicates near top of mineralized zone.
Alteration is coincident with anomalous Cu and Mo rock-chip samples.”
“Zones of intense stock work and sheeted veins show evidence of extensive hydrothermal activity and structural preparation of host rocks to receive mineralized fluids.”
Miramont believes that Lukkacha has a similar geological setting to long trend porphyry deposits. Additionally, it has exceptional and strongly developed stock work and sheeted veins, with a multi-phase intrusive center. Furthermore, the company stated,
“A large and clear geochemical anomaly indicate that the property has excellent potential to host a world-class porphyry Cu deposit.”
Certainly, there is significant smoke at these projects. It’s now up to a world-famous geologist, Quinton Hennigh, and his team to find out what lies beneath. The drilling is set to begin at Cerro Hermoso early in 2018.
Recognize that we are biased toward Miramont as the company is an advertiser client and we participated in its recent private placement for our own investment purposes. Please take responsibility for practicing your own thorough and independent due diligence. Learn about the risks associated with investing in small-cap resource companies of this nature. Pick your spots…
Hennigh’s Career Goes Beyond Novo
Dr. Hennigh is an economic geologist that has been scouring the globe for gold deposits for the past 25 years. He cut his teeth working for major firms including Homestake Mining Company, Newcrest Mining and Newmont Mining. Ten years ago, Dr. Hennigh joined the junior mining sector to make his own discoveries.
Most notably, he led exploration at Gold Canyon Resources at the Springpole alkaline gold project near Red Lake Ontario, a 5 million ounce gold asset that was recently sold. And, as discussed in detail above, Dr. Hennigh helped start Novo Resources, responsible for assembling its Australian exploration portfolio.
Chairman Hennigh Teams up With CEO Pincus
Quinton Hennigh is joined at Miramont with President and CEO, Bill Pincus, who has a record of discovery stretching from 1979 to today…
Mr. Pincus has 40 years of experience as a geologist, consultant and executive in the minerals industry. Starting in 2002, he formed Esperanza Resources and served as CEO/President. Esperanza successfully discovered two deposits in Mexico and Peru before its acquisition by Alamos Gold. Furthermore, he is perfectly suited for a Peru play as he has lived and worked in the country for over 25 years.
Together, Pincus and Hennigh have an impressive track record, are well-financed with Miramont, and positioned to potentially make another discovery.
We expect the next several weeks to be very telling for Miramont Resources (MONT: CSE) as the general marketplace learns of Quinton Hennigh’s new venture. As Chairman, he will be leading the company and board of directors through the exploration stages.
As is the case with all our featured companies, we will have boots on the ground in Peru in roughly 7 days to bring you a first hand account of Miramont’s operations. We take our investments, and reputation, very seriously. As such, we will be following up in due course with a comprehensive update and exclusive footage from our trip.
This marks the initiation of our coverage on Miramont Resources (MONT: CSE), which recommences trading at the open tomorrow. Stay tuned…
All the best with your investments,
Miramont Resource Stock Information:
Stock symbol: MONT – recommences trading on the Canadian Securities Exchange tomorrow at market open
Shares issued and outstanding (approx): 50,098,297
Treasury: Closed $6 million financing on November 15, 2017
Miramont’s Corporate Presentation
Disclosure, Risks Involved and Information on Forward Looking Statements:
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Set forth below is our disclosure of compensation received from Miramont Resources Corp. and details of our stock ownership in the Company as of November 26, 2017:
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