On PG's X page Gentile's take" Today USGD regained 100% ownership of the Madison high grade Copper/Gold asset in Montana. Recall it was under a JV with Rio Tino allowing them to earn up to 70% by spending $30MM over 11 years through 2030 (7 years left on the JV and about $23MM left to spend) When I got the news this morning my initial reaction was this is actually good news for USGD shareholders.
The JV terms allowed Rio to stretch their spend over next 7 years until 2030 to earn 70% - USGD acquired the JV which at the time was a 11 year JV . So as a result they were moving slowly, they just changed exploration heads for North America and they had other priorities in the near term and so the spending levels were low the last 2 years and would be low again next year USGD had proposed and approved a drill program for this year and I think this forced them to make a decision as it would be increasing the spend required by Rio to earn their 70% ownership. USGD wants to move this forward as its a fantastic asset and the reason why I originally invested in the company so now when we have success with the drill program this year USGD will now own 100% of it not 30% and we can move it forward at a pace that we choose (faster if markets are good and slower if they are not As a reminder of why I like Palmer so much take a look at the history of this mine and region, Madison is small scale Past producer 2.7M lbs of copper with grades ranging from ~20% to over 35% and 7,570 ounces of gold at 16.1 g/t between 2008 and 2012 Recent high grade hits (2017-2020) show that the small scale production from 2008-2012 was just scratching the surface.
Some highlights from recent 2017 to 2020 drilling 30.18 m of 24.497 g/t Au 10.97 m of 41.65 g/t Au 61.63 m of 6.97% Cu 1.7 m of 69.4 g/t Au and 23.61 m of 2.19% Cu 43.66 m of 1.76 g/t Au 15.45 m of 0.96% Cu Given the above, I have no doubt this is the type of asset that other majors will covet and now owning 100% again will give us a much stronger hand in terms of eventual M+A on further exploration success or potential new JV partners If you want to see big returns on junior equities, owning 100% is key for M+A tension as well. This 100% owned asset + Palmer JV in Alaska (where we just had those amazing results) + our other JV call option assets in Nevada is a very nice mix for a junior mining company. I think once retail dust clears today the company is more valuable today than it was yesterday and would be a buyer on any weakness today."