Yukon Gold, MotherLode Jay Currie’s Motherlode:
Exploration
I like exploration stories. Taking a prospective piece of ground and developing and testing a theory about its precious metals endowment is high risk but, potentially, ultra high reward. A discovery hole may potentially drive a $0.05 stock to $1.00 overnight. Here are three companies with very different exploration styles, which I am sharing my review notes with you on today.
Kestrel Gold Inc.
OK, I admit it, I love the Yukon. I love the land, the people and the Tintina fault. I love the Klondike gold stories and the miles of stones on the drive into Dawson from the airport.
The logic of Yukon gold begins with the placer gold found in the creeks of the Klondike. This is not rocket science: that gold had to come from somewhere and the bet has to be that it rolled down from the hills surrounding the placer creeks. Paul Gray, Victoria Gold’s VP Exploration, once told me that his leading indicator for gold was a placer operation in a creek under a hill.
Bernie Kreft knows this. He owns properties all over the Yukon (and in BC) which are very prospective for gold. He put several of them together into Kestrel Gold Inc. (TSXV: KGC). In a Kitco interview in 2018, Bernie said, “Without a doubt, there’s monsters up here hiding,”.
Kestrel is doing pure “greenfields” exploration. Its projects have been prospected, there have been samples taken and mapping done on its projects but drilling has been limited. That will change this summer.
For an investor, this is a lottery ticket. Bernie knows three of the six numbers are right. But the last three count for the win. What Kestrel is looking for on its properties is a discovery hole. A drill hole which has good gold grades across a few meters. The geology of each of its properties suggests that there is a greater than zero chance there will be a discovery. The fact that they are surrounded by placer miners boosts that chance.
I’m holding shares because I want to see what the 2021 season brings to Kestrel. They have lined up their shots which takes a lot of ground truthing, soil sampling, trench cutting and sheer hard work. Now Dr. Drill will tell the tale. A well managed company like Kestrel can drill its holes on a vanishingly small budget, and become a moonshot.