With its 35 million shares issued, Equitas Resources Corp. (TSX.V: EQT) has a current market cap of $3 million CAD. During the last few months, Equitas has not only identified numerous high-priority VTEM anomalies on its large Garland Property (which may get drill tested this summer), but has assembled a high-carat management, exploration and advisory team as well. Great projects attract great people.
Goldie Comes to Equitas
On Wednesday, June 24, Equitas appointed Raymond Goldie to its board of directors. Mr. Goldie is currently Vice-President and Senior Mining Analyst with the Canadian investment bank and research house Salman Partners Inc. He brings extensive industry experience to Equitas, including more than 20 years as a mining analyst and industry economist. Goldie holds 3 geology degrees (a BSc from Victoria University, a MSc from McGill University and a PhD from Queen’s University), as well as a diploma in Business Administration from the University of Toronto. Goldie frequently appears on national television and is a keynote speaker at mining conferences.
In 2005, Goldie published ”Inco Comes to Labrador”, a book on Inco’s acquisition, progression and development of one of the most substantial mineral discoveries in Canada: The Voisey’s Bay Nickel Deposit, which “one Newfoundland politician would describe as ‘beyond our wildest dreams.’ Raymond Goldie’s interest in Voisey’s Bay began in 1970, when he was part of the first prospecting team to visit the coast of Labrador to examine its potential for deposits of copper and nickel. In the late 1970s, armed with a PhD in geology from Queen’s University, Kingston, he began to work in the Canadian investment industry, most recently with Salman Partners Inc. As mining analyst, he has followed the fortunes of North American mining companies and mine developments, including Inco Limited and its Voisey’s Bay nickel-copper project.”
In March 2004, when nickel was trading at around $6/lb, Goldie wrote a paper entitled “The Shortage of Nickel”; with the following excerpt:
“There is a chance that geologists can help to fill the gap. The world’s existing nickel operations have bottlenecks at the mine level, while smelters and refineries are running below capacity. New discoveries at existing mines are probably our only chance to keep these smelters and refineries full… And the gap between demand and supply? … How can we fill this growing gap? We can’t do it out of stockpiles, because producer plus LME inventories are close to record lows. The only possibilities seem to be massive substitution of other materials for nickel; finding new sources of supply; or rationing. I’ll look at these alternatives in a moment.”
Shortly after Goldie wrote that paper, the nickel price surged to $23/lb. Today, nickel trades at $6/lb again, whereas the mid- to long-term fundamental outlook for nickel appears to be just as good as it was in 2004. Few nickel mines have come online in the past 10 years and the supply side looks evanescent in comparison to the robust global demand, which may skyrocket again. As Goldie has mentioned, great geologists, like himself, may help to fill the gap as the best solution is simply to find new sources of supply.
The dream is on, and the moment of truth is just a few weeks or months away, to find another Voisey’s Bay style nickel mine in northern Canada. Thanks to new state-of-the-art exploration technologies, the chances have never been better, as our Initiating Coverage and Research Update #1 have shown. However most importantly, Goldie is not alone with his dream, but backed up by probably the best geologists in the Canadian nickel space.
Everett Makela, VP Exploration of Equitas, said in an interview: “I am pleased to be technical lead in the Equitas search for Canada’s next major nickel deposit.”
When the Voisey’s Bay Nickel Deposit was acquired in 1996, Inco’s Principal Geologist, Everett Makela, was on the due diligence committee deciding in favor of the 4.3 billion USD take-over. Since February 2015, Makela serves as VP Exploration for Equitas. In an interview, he explained why Garland, which is only 20 km southeast of Voisey’s Bay, is “the most prospective area outside of the Vale mine property.” Makela retired in 2012 as Vale’s Principal Geologist North-America working “alongside some of the leading experts in nickel exploration and benefited greatly from access to the resources of leading global nickel companies”, as he put it.
Today, Makela works alongside Alan King, who recently reviewed Equitas’ newly generated VTEM data. King is a recognized expert in electromagnetic exploration methods and previously served as the Chief Geophysicist for Inco/Vale’s global exploration operations. He has worked as a geophysicist in exploration and resource development globally since 1976.
Today, Vale S.A. enjoys a 40 billion USD market cap and is one of the world’s 3 biggest mining companies besides Rio Tinto and BHP Billiton. Vale is the operator of the world-class Voisey’s Bay Nickel Mine, which is “only” the 7th biggest nickel deposit of the known world, but said to be the most significant one for the Western World. It produces on an annual average 35% of Canada’s nickel production. Nickel’s share on Vale’s global profit is a staggering 35% representing one of the company’s main pillars besides iron ore.
The industry leading VTEM airborne geophysics exploration technology, which was developed and implemented in the last few years, has discovered numerous new deposits on a worldwide scale as it is capable to “see” below earth’s surface to a depth of up to 750 m (i.e. scan deeper seated rocks for electromagnetic conductivity, first and foremost sulphides). Equitas commissioned the VTEM Plus system, which penetrates to depths of up to 350 m. Equitas announced in May to have identified 9 distinct VTEM anomalies indicating sulphidic nickel-copper mineralization in a depth exceeding 75 m (previous geophysics on Garland were capable to penetrate below surface up to 75 m at most). These 9 targets, potentially each an economic deposit, are presented with below map:
As being the case with other major nickel mining districts on the planet, its deposits typically occur in multiple groups (“clusters”). However, a second Voisey’s Bay style deposit has not been found in the region, yet. Could the additional multiple groups/clusters occur at depths not yet tested? Historical geophysical work on the Garland Property only went as deep as 75 m below surface; the VTEM Plus utilized last month has allowed Equitas to scan 5 times deeper. The Voisey’s Bay Deposit was discovered in 1993 only because of fortunate circumstances of a locally limited erosion exposing mineralization at surface.
The Initiating Coverage, entitled “Vale Vale! Ex-Vale‘s Principal Geologist and Chief Geophysicist on the Case to Answer The Multi-Billion-Dollar-Question”, can be read via the following link:
https://rockstone-research.com/images/PDF/EQT1en.pdf
The Research Update #1, entitled “King & Makela Identify Nine ‘Knock-Your-Socks-Off’-Targets near Voisey’s Bay Nickel Mine”, can be read via the following link:
https://rockstone-research.com/images/PDF/Equitas2en.pdf
Above chart (15 min. delayed):https://scharts.co/1HzJOfn
Disclaimer: Please read the full disclaimer within the above mentioned research reports, as the author, Stephan Bogner, holds shares of Equitas Resources Corp. and thus would profit from a price increase, whereas he could sell shares anytime without notice. Neither the author nor Rockstone Research was paid or instructed by Equitas Resources Corp. to write or publish this content. However, please read the full disclaimer within the above mentioned research reports and on www.rockstone-research.com as conflicts of interest exists also with Zimtu Capital Corp. Therefore, none of this content is to be construed as "financial analysis" or "investment advice."