After almost two months of exploration at the Esperanza property at the Flecha de Oro project in Argentina, results are starting to come in for Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE). The ongoing trenching program is currently in Phase I, and focused on a nine square kilometre area where numerous gold-bearing quartz veins have been identified at surface. There were several interesting and economic intercepts reported, which incentivizes management to continue searching for the heart of the mineralized system.
All pictures are company material, unless stated otherwise.
All currencies are in US Dollars, unless stated otherwise.
Ivana deposit; Rio Negro province, Argentina
As uranium sentiment for stocks remains strong, Blue Sky Uranium (TSXV: BSK; US-OTC: BKUCF) is looking to seize the moment, and continues to advance their flagship Amarillo Grande uranium project in Argentina. This strong sentiment puzzles fund managers specialized in uranium stocks, as usually the uranium spot- and contract prices appreciate first, and stocks follow. Despite all mine closures, cut-backs in production and the US reserve bill, uranium prices hardly moved, as is shown on this chart from the Cameco (CCO.TO) website:
As copper is riding at 9 year highs lately, Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE) acknowledged this fact and recently made an adjustment to their exploration strategy, which previously focused predominantly on their gold projects Tierra Dorada in Paraguay and Flecha de Oro in Argentina, and to a lesser extent on their Rosales Copper project in Chile. This switch makes sense, as copper is even closing in on all-time highs now (US$4.63/lb Cu), as can be seen on this chart by Macrotrends:
As Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE) was sidelined for most of last year due to COVID-19, their exploration programs were basically halted. The project that first got underway again was the Tierra Dorada Gold project in Paraguay. The story on this project is a testament to the strong network of Golden Arrow in Latin America. When CEO Joe Grosso talked to officials in Paraguay somewhere in 2019, they told him to take a look at some of their projects, and talk to local geologists. So he did, and these geologists identified numerous projects, ready for staking. In the end, 2 claim blocks totaling 64k hectares were staked.
As Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE) renegotiated their Indiana gold project in Chile not too long ago into very favorable terms, I was surprised to recently read about the company dropping the project:
“The Company also wishes to report that it is not proceeding with its option of the Indiana Gold-Copper project in Chile.”
when announcing in the same news release the acquisition of the Rosales Copper project, located in Chile as well, which is less advanced, and will be discussed later on.
The Corona virus pandemic together with the Saudi Arabia-Russia oil production increase took its toll on the equity markets the last few weeks. The commodity markets in particular got hit too, as main end user China got hit by a halt in manufacturing plants across the economy. Precious metals like gold rose initially, but after the virus spread globally it got sold off ruthlessly like any other asset class. Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE) as a gold explorer didn’t come out completely unharmed either, as the following chart shows:
Share price Golden Arrow Resources 1 year time frame; Source: Tmxmoney.com
Ivana deposit; Rio Negro province, Argentina
After raising C$0.87M in October of last year, Blue Sky Uranium (TSXV: BSK; US-OTC: BKUCF) has been busy defining drill targets on their fully owned Amarillo Grande Uranium Vanadium project in Rio Negro, Argentina. An 8 kilometre long IP survey has been completed, which identified a 5 km long anomaly 20 km north of the Ivana deposit. The next step will be a reverse circulation (RC) drill program to hit the typical near surface mineralization. Management is looking to increase the resource towards a district scaled size, being redox type which regularly relates to very large deposits, and which in turn will likely improve 2019 PEA economics further. Speaking of which, as a reminder at a relatively (industry wide) low base case uranium oxide (O3O8) price of US$50/lb U3O8, the after-tax NPV8 of Ivana is US$135.2M and the IRR is 29.3%.
Golden Arrow Resources (GRG.V, GARWF.US, G6A.FSE) recently came out with some pretty interesting news on their Indiana gold project in Chile. They managed to amend the definitive agreement with the property owner Mineria Activa, a Chilean private equity investment management firm focused on exploration to production-stage assets in mining. Golden Arrow now has the right to earn 100% of Indiana over a 74-month period, expiring in December 2024, and the total cost of US$15.1M has not changed.