Well, I think ... The real value of any junior gold investment is in the level of confidence that it will produce a quantity of ounces of gold at a profit in the future. One can assess the geology, deposit type, geological team, land, access, infrastructure, and geopolitical and environmental jurisdictions to determine if a project determines further interest. As far as management goes, in bad times it must be the best but in good times it can be a team of monkeys because no one gives a dang when the drills speak or there is ‘blue sky promise’. In the case of a ‘DEC’ you can easily assess these factors and throw in the visibility and attraction of the ‘Golden Triangle’. By comparing a targeted project to a group of peers (and considering the present historical low price of gold) it is possible to determine how drastically undervalued the particular project/projects is/are.
When the precious metals markets are in a thriving bull, when high risk/high reward come in to plat, the type of in-depth analysis considered will not even require any type of resource study or feasibility study (such as we saw in the mid nineties with projects such as Arequipa being taken out by Barrick for $30).
Given the present, long endured environment, with the negative aura pervading this sector, it is not at all surprising to see valuations at their lowest of any era one can consider for a very long time. This is exactly the scenario just before a raging bull commences … as history proves. Until that starts, everyone wants proof of deposit and they want it cheap. Doing a preliminary economic assessment and then a feasibility study takes a lot of time and costs a lot of $ … and this is mostly done by the miner or larger junior that takes the explorer out. The cost/take out offer today for any explorer will be drastically below any offer with gold in the $1500 area. Demand for promising property can explode in no time. My opinion is that those kicking the tires will have to pay up big time before they know it and the competition will be fierce. To take a property to production can take 5 to ten years and very, very few explorers ever do. It can cost hundreds of $millions.
Gold is harder to find today than ever. Juniors are necessary to find the gold. (big producers don’t do the exploring). The junior explorers are instrumental in the gold supply chain and producers can not exist without them. Right now, the mine supply has peaked and is decreasing. You will note the increase in acquisitions is rapidly heating up over the last year as they will need to supply future growing markets and they cannot do that with diminishing resources. World gold demand has been increasing much greater than the like of the World Gold Council pretends. Producers are accountable to the markets by their inventories … and they will need building now. What happens in a gold rush when world demand exceeds supply by a factor of 5??? What happens is that a ‘high risk’ atmosphere creates value for Moose pasture exploration, that’s what.
So it all comes down to the junior out there with the parameters outlined above. They are way ahead of the game believe it or not.
Look, young folks out there …. this is an opportunity you will never get again. It can change your lives. Whatever the junior out there you want to RESEARCH (NRs and SEDAR) you will see that those in the Golden Triangle are amongst the top of the heap. Check it out. Spend some time researching. Good juniors with promising drill assays are going to be HOT in 2019. Buying cheap, cheap, today and being patient will reap big, big rewards in 2019.