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Fremont Gold gears up to drill for discovery at Griffon in Nevada

By James Kwantes
Resource Opportunities

Nevada is known as “The Silver State,” a nod to the 1859 discovery of the Comstock Lode. That rich silver endowment led to Nevada’s statehood, and profits from silver mining helped the North come out on top in the American Civil War.

But the discovery of the state’s rich gold districts, including the Carlin and Cortez trends, a century later quickly made Nevada one of the world’s premier gold mining jurisdictions. Those two districts alone have a combined gold endowment of more than 250 million ounces (production + reserves). And gold is the precious metal that remains Nevada’s largest export by dollar value.

However, U.S. Census Bureau statistics show that Nevada’s gold output is slipping. Gold exports of about $4.9 billion in 2018 dropped to $2.7 billion last year, a 45% decrease.

And Nevada is not the only gold-rich jurisdiction with a declining production profile. New discoveries are needed to replace the ounces being mined. And one of the best places to look for gold is on projects that have been orphaned by larger companies or by exploration companies that have shifted their focus elsewhere.

The latter is the story with the past-producing Griffon project at the southern end of Nevada’s Cortez trend. Fremont Gold (FRE-V, USTDF-OTCBB) purchased Griffon and its 89 unpatented mining claims from Liberty Gold (LGD-T) in December 2019, then raised $1.48 million to drill it. The project was orphaned by Liberty (formerly Pilot Gold), which is drilling out its Black Pine oxide gold project in Idaho. Griffon is southeast of Fiore Gold’s (F-V) Pan mine and Contact Gold’s (C-V) past-producing Green Springs heap-leach gold mine.


Fremont plans to drill 2,000 metres at Griffon, beginning in June. Twenty-six drill sites are currently permitted and the project is bonded. Fremont plans to drill a number of untested targets in the hopes of making a new discovery at Griffon.

Griffon was first drilled in 1988. By 1997 two oxide gold deposits had been delineated, at Discovery Ridge and Hammer Ridge. Over the next three years, Alta operated as a small producer, mining oxide gold from those deposits at average grades of 1.03 g/t in a heap-leach operation. That’s well above average grades of 0.6 to 0.7 g/t being heap-leach mined at typical Nevada oxide gold operations.

Alta’s focus was production, not exploration. The company did not thoroughly explore the property and almost all of the holes they drilled were less than 100 metres deep. Fremont has assembled a crack team of geologists to narrow down targets at Griffon:

  • Clay Newton, Fremont’s VP Exploration and a Phd structural geologist who brings fresh eyes to the project
  • Andy Wallace, Ph.D., a Carlin expert and co-discoverer of five Nevada gold mines as a principal of Cordex
  • Jamie Robertson, Ph.D., Alta’s former exploration manager and a regional expert on Nevada’s southern Cortez trend.

Target areas at Griffon include the untested three-kilometre long Blackrock fault to the east of the Hammer Ridge deposit (one of the two deposits mined by Alta Gold Corp.), the Pilot Shale horizon, and a number of geochemical anomalies. In addition, potential remains in and around the two past-producing open pits.

Clay Newton, Fremont Gold’s VP Exploration, checks out a jasperoid outcrop, an alteration style associated with Carlin-type gold mineralization, at Fremont’s Griffon property on the southern Cortez trend.

Drilling by Alta in an area southwest of Hammer Ridge hints at the property’s potential. Alta hit near-surface gold mineralization in many holes, including 57.9 metres of 0.86 g/t gold. Other drill holes in this area — all of them within 100 metres of surface — included:

  • 25.9 metres of 1.1 g/t Au
  • 36.6m of 0.93 g/t
  • 24.4m of 0.79 g/t

Last summer, Fremont sold its Gold Canyon project to McEwen Mining for 300,000 McEwen common shares in order to focus on securing more advanced-stage assets. The company’s first move was to option Cobb Creek from Contact Gold. Located in Elko county, Nevada, Cobb Creek is an advanced project with a historical gold resource that hasn’t been drilled since 1992. Although Cobb is an intriguing exploration project, Fremont plans to focus on Griffon this exploration season. The company also has the North Carlin, Hurricane and Goldrun projects in Nevada.

Gold is holding steady above US$1,600 an ounce and doing its job as a safe haven. The precious metal is also, increasingly, a buttress against the impending waves of money-printing as governments globally respond to economic paralysis caused by the COVID-19 pandemic.

Gold producers continue to rely on exploration companies to find the next economic ore bodies. That increases the appeal of well-managed juniors poised to create shareholder value with the drill. Fremont Gold fits the bill as it prepares to drill for discovery at Griffon. Insiders have been adding to their stakes, in both the public market and private placements. I have also been buying shares at these price levels.

Fremont Gold (FRE-V, USTDF-OTCBB)
Price: 0.06
Shares out: 81.5 million (121.2M f-d)
Market cap: $4.9 million

Disclosure: I own Fremont Gold shares and Fremont is one of three Resource Opportunities sponsor companies. Fremont is a speculative, high-risk exploration stock that may not be suitable for all investors. This article is not intended as financial advice and all investors should conduct their own due diligence and/or consult an investment advisor.

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Genesis Metals drills for high-grade gold in Quebec

Drilling later this year will test new targets identified by last year’s property-wide soil sampling.

By James Kwantes
Resource Opportunities

For veteran speculators, the latest hits to junior mining share prices feels like deja vu all over again. Sentiment is gloomy and market capitalizations are depressed. But gold in U.S. dollar terms is still up more than 25% year-over-year. And US$1,500 gold translates to more than $2,150 Canadian, an exceptional price for Canadian projects whose expenses are measured mostly in loonies.

Gold producers that deplete their reserves with every shift and every scoop still rely on junior exploration companies to find the deposits that will replenish their ore. Most juniors, meanwhile, had yet to respond even BEFORE the Coronavirus corrections — which has further pummelled the sector. Expectations are very low, along with share prices.

For exploration companies with strong management and backing, a flush treasury and potential for high-grade discoveries, it’s not a bad setup. Genesis Metals (GIS-V, GGISF-OTC) fits the bill. The Discovery Group company has $3.5 million in the treasury to drill its flagship Chevrier project in Quebec’s Chibougamau mining district. Chevrier is located in the eastern portion of the prolific Abitibi Greenstone Belt (180M oz of historical gold production).

Genesis is drilling an initial 2,500 metres (10 holes) at Chevrier, part of a planned 8,000-metre drill program this year. The initial program is designed to tap into high-grade shoots within the Chevrier Main zone deposit, expanding the higher-grade domain. Genesis’s market cap of about $7.9 million is backstopped by existing gold resources at Chevrier totalling 395,000 ounces Indicated grading 1.45 g/t Au and 297,000 ounces Inferred at an average grade of 1.33 g/t, at the Chevrier Main and East zones.

The company has already identified high-grade areas within the deposit — assays announced on January 22, 2018 included 8.73 g/t over 21.35 metres and 4.26 g/t over 19.4 metres at the Main Zone. But those results went unappreciated with gold trading at US$1,330 an ounce on its way down to $1,200. Later this year, Genesis plans to test targets elsewhere on the 295-sq-km property that were identified through last year’s property-wide glacial till survey.

Overseeing the exploration program is new CEO David Terry, an economic geologist who was appointed President and CEO on Dec. 2, 2019 (Jeff Sundar remains as Executive Director). Terry obtained a PhD in Geology from Western University in Ontario. He’s also well-schooled in the vagaries of bull and bear market mining cycles, through decades in the industry running projects — both large and small — for majors and helming explorecos. Terry is currently a director of several active exploration companies including Golden Arrow Resources, Aftermath Silver and Great Bear Resources. Great Bear, also a Discovery Group company, is drilling high-grade gold along kilometres of strike at its Dixie project in Red Lake, Ontario.

For Terry, the Great Bear directorship is a kind of return to Red Lake. His first summer job in exploration included mapping and sampling in the prolific district for a large mining company called Goldfields while he attended Western in the 1980s. He later worked for several years as a contract geologist with Cominco (which sponsored his PhD thesis) in Alaska, followed by a stint with Hemlo Gold exploring back in the Abitibi.

Geologist David Terry, the Genesis Metals CEO, in the field at a gold project in central Ecuador.

After obtaining his PhD, Terry worked for Westmin Resources then Boliden, as a geologist and project manager. When Boliden exited Canada with the mining sector in a post Bre-X slump, Terry took a position as a Regional Geologist for the B.C. Geological Survey in southeastern B.C. for three years. He spoke at the closing ceremony for Teck’s legendary Sullivan mine, which operated for nearly a century and produced 160 million tonnes grading 12% zinc/lead and 67 g/t silver. Since 2004 he has worked in management, director and advisory roles with a number of juniors exploring and advancing precious and base metal projects in both North American and a number of Latin American countries.

Terry joined the Great Bear board in July 2016, before the Dixie project was the company’s flagship. Great Bear’s mineralized LP fault is now recognized as one of the best gold discoveries of recent years, globally. But Terry remembers when the team operated in relative obscurity, with GBR shares trading for dimes not dollars.

As for Genesis, adopting a go-slow approach in 2019 laid the groundwork for an active 2020. Instead of drilling in the depths of a bear market, former President and CEO Jeff Sundar focused on building out the team and raising a war chest. Genesis joined the Discovery Group of companies and added Discovery principals John Robins and Jim Paterson as strategic advisors. The Discovery Group has an impressive record of wins in recent years, including the $520-million sale of Kaminak Gold to Goldcorp and the $117-million sale of Northern Empire Resources to Coeur. Rob Carpenter, the cofounder and former CEO of Kaminak, also came on as a strategic advisor.

Genesis’s successful financings were done in conjunction with a 5-for-1 share consolidation and the appointment of Terry as CEO. Rollbacks have a bad reputation — and rightly so — but consolidations done in conjunction with management changes and large financings can set the stage for success. Great Bear is another example of a successful rollback, its tight share structure helping to propel the stock post-discovery.

Chevrier is located in a prolific district of high-grade gold resources. Directly to the southwest is the Monster Lake gold discovery, where JV partners IAMGOLD and TomaGold have identified an Inferred resource of 433,000 ounces at 12.14 g/t gold. At the Nelligan project further southwest, Vanstar has delineated 3.1 million ounces of gold (Inferred) at about 1 g/t but last year hit 6 metres grading 56.46 g/t Au. IAMGOLD recently increased its interest in the project to 75%.

South of Chevrier, the Joe Mann gold mine produced 1.2 million ounces of gold at 8.26 g/t, as well as silver and copper. Infrastructure is excellent at Chevrier: a highway and power line runs through the property and the regional airport is a few minutes drive to the north. 

With Discovery Group backing, a strong management and technical team, and a full treasury to drill high-grade gold targets at Chevrier, Genesis has laid the foundation for success. And high-grade gold discoveries get rewarded by the market, even in these tumultuous times for juniors.

Genesis Metals (GIS-V)
Price: 0.18
Shares outstanding: 43.76 million (59M fully diluted)
Market cap: $7.9 million

Disclosure: James Kwantes owns Genesis Metals shares and Genesis is one of three Resource Opportunities sponsor companies. Genesis is a speculative, high-risk exploration stock that may not be suitable for all investors. This article is not intended as financial advice and all investors should conduct their own due diligence and/or consult an investment advisor.