International Tower Hill Mines (ITH-TSXV)
• ITH is focused on its Livengood gold project located 110 km north of Fairbanks, Alaska.
Why Is It Interesting? • The Livengood project is big and getting bigger and better fast. The Livengood project has experienced rapid resource growth, increasing from an estimated 1.9 million ounces to 6.8 million in a year. The latest round of drill results since September is showing weighted average grades of 1.09 g/t, 30% higher than the latest resource estimate. The deposit is open in all directions, and ITH has drilled only a small portion of the anomaly’s surface expression.
• The company has potential catalysts this year. News expected in the year ahead includes monthly drilling updates, three resource estimates in June, October and February, metallurgical work, and a Preliminary Economic Assessment to be released in July. ITH has budgeted 40,000m of drilling in 2009, approximately equal to the amount of drilling completed to date. The company plans to test double the area drilled thus far. ITH is targeting a 10 million oz resource by year end, including 7 million oz with a grade over 1 g/t.
• Good shareholder base could hint at takeover. Institutions hold 65% of the stock with AngloGold Ashanti controlling 13%. We suspect AngloGold (AU-N, Not Rated) and Kinross (K-T, Buy, $28.00 Target Price), the operator the Fort Knox mine in Alaska, to be following ITH’s progress as it advances Livengood to feasibility.
• We believe International Tower Hills’ Livengood project could be on the verge of becoming an economically viable project possibly resulting in a valuation jump for the company’s shares. Positive news flow this year might include higher grade intercepts and resource estimates that could grab the attention of the market. The company is trading at US$20 per total resource oz on a fully diluted basis, cheaper than many of its peers.
Project Description
• ITH owns 100% of the 44 km² Livengood project which has access to great infrastructure for Alaska. The property is located near a paved highway, 55 km to the power grid, and along the proposed Alaskan natural gas pipeline route. In January, ITH released a 6.8 million ounce gold resource, half of which was in the indicated category with a grade of 0.83 g/t
Financial and Share Structure
• The company has $15 million in cash after recently raising $10.5 million in a bought deal financing.
• The company has 48.5 million shares and 60.5 million shares fully diluted.
Management
• Jeffery A. Pontius, President and CEO – Mr. Pontius has 28 years of geological experience and has discovered three precious metal deposits in his career. He worked last with AngloGold Ashanti (USA) for seven years where he became North American Exploration Manager.
• Russel Myers, Vice-President, Exploration – Dr. Myers has over 25 years experience of geological experience and also worked for AngloGold for six years holding several key senior geological positions.
• Hendrick Van Alphen, Director & Chairman – Mr. Van Alphen has been in the mining business for 23 years and is a director of several resource companies. He was President of Pacific Rim Mining.