Full Version / The gold-silver showings (in red) on the Tocvan Pilar property are expected to be greatly increased with the upcoming drill program.
There is (finally) the news that we shareholders of Tocvan Ventures Corp. (CSE: TOC; WKN: A2PE64): The strategically important investment was closed today, which means that there is now enough money in the cash register to carry out the upcoming drilling programs on the Pilar gold-silver project in Mexico.
While the gold price fell to a strong support at $ 1680 yesterday and a new upward trend is heralding itself from here, the Tocvan share fell to an attractive level in yesterday's trading course, from where a rebound - thanks to today's news - should take place. Because only a few share sales triggered yesterday's correction.
Full version / Despite yesterday's correction, the upward trend in Tocvan shares is still intact.
Tocvan's CEO Derek Wood wrote on the CEO.ca discussion platform on Saturday : "We are picky about the placement of the PP" (PP stands for "Private Placement", in which strategic investors participate in the company). That may well have been the reason for the private placement, which has now been open for 4 weeks, which obviously put pressure on the share. When the equity stake was announced on March 1st, the stock was trading at $ 0.50. The stock closed at $ 0.50 yesterday as well, so a quick rebound to the $ 0.80 level should come as no surprise, especially considering the newsflow ahead for Tocvan.
According to today's news, Tocvan raised $ 746,801 in fresh funds from strategic investors for which only 1.2 million shares (plus 1.2 million warrants) were issued (at a price of $ 0.60 per share + warrant). It was also announced today that Tocvan raised an additional $ 650,000 through the exercise of 2.6 million warrants from the final funding round in February 2020. With the $ 0.75 million closed today, Tocvan now has $ 1.4 million in cash (plus previous cash on hand).
The number of all shares issued only had to be increased marginally and is currently 27.9 million. If the $ 0.75 million warrants are exercised, Tocvan will receive approximately $ 1 million and the number of shares issued increases to a total of 29 million. This would still be a very tight stock structure that other companies can only dream of, as Tocvan can now use the $ 1.4 million to finance two large drilling programs , as it became known today. At the current share price of $ 0.50, Tocvan is valued at $ 14 million on the stock exchange. This is still a very cheap market valuation given how advanced the Pilar gold-silver project is today and how other projects in the area are valued.
All in all, an attractive share structure with a low company valuation in order to enable a sharply rising share price with successful drilling programs.
Tocvan President & CEO Derek Wood commented on today's news: "We are extremely pleased with the progress at Pilar, particularly our recent drilling successes, and we look forward to an active year of drilling as we further develop Pilar's off-property potential We remain focused on maximizing shareholder value and with the completion of the private placement we now have the capital to not only advance Pilar, but also evaluate other gold projects in Mexico to add to the company's growing portfolio. "
Today, Tocvan also announced how the available funds will be invested in the Pilar Project in order to maximize shareholder wealth:
• The phase 2 drilling program will begin in mid-April, which will now be divided into 2 stages thanks to the funds available:
• In the 1st stage, the well-known Main Zone deposit is to be enlarged, just as the Phase 1 drilling program (December 2020) successfully achieved when, for example, 95 m @ 1.6 g / t gold were achieved (incl. 9, 2 m @ 10.8 g / t gold and 37 g / t silver ). These results were comparable to the drill results from Tocvan's neighbors Minera Alamos Inc. and Argonaut Gold Inc. ( see here) .
• In the 2nd stage, the newly discovered target areas outside the Main Zone are to be tested (New Triple Vein Zone and 4 Trench Zone), which will enable significant new discoveries to be made.
Full Version / Property Map shows the success of Tocvan's completed exploration programs (December 2020 holes scored 3 world-class hits in the Main Zone deposit, which was enlarged) and the prospects for the upcoming Phase 2 drill program, which is the first time outside of the established Main Zone can discover new deposits.
Full Version / The Pilar Project is located only 50-80 km from 2 major gold-silver projects.
• Tocvan Ventures Corp. valuation: $ 14 million
• Minera Alamos Inc's valuation: $ 261 million
• Argonaut Gold Inc. valuation: $ 677 million
The exploration program that has been carried out over the past few weeks has discovered new vein systems outside the established Main Zone deposit (where more than 90% of all drilling to date has taken place; totaling approximately 19,000 m total length). The laboratory results of more than 200 collected rock samples are expected shortly, after which the drilling program can start.
Conclusion & outlook
After Tocvan shares hit a new all-time high at $ 0.81 in late February, a correction began that should now have ended because:
1. Exercising warrants typically creates pressure on the stock because some investors reduce their stock holdings in order to exercise the warrants with the money (which increases the stock holdings again).
2. A financing announcement often causes pressure on a stock along with a setback to the financing price.
Since the majority of all warrants have now been exercised and the financing has been completed today, there is no longer any pressure on the share that was exerted by the two factors mentioned above. A new uptrend should be imminent, particularly in anticipation of the many laboratory results from the most recent rock sampling program (> 200 samples) and the start of the Phase 2 drill program in mid-April. Junior gold stocks like Tocvan often rise shortly before a drill program begins, as some investors anticipate drilling success.
The stock market magazine The shareholder yesterday published the article "Gold:" Strongest rally is looming " , which deals with an analysis by Wells Fargo Bank. Due to a decline in supply growth in the gold market, the price of gold is expected to rise to $ 2,200 by the end of the year." The gold supply has turned from an oversupply into a deficit. Such times have sparked some of the strongest gold price rallies in the past, "Wells Fargo said. Due to the" excessive supply, "gold had a difficult time prior to 2018, Wells Fargo said.
Full version/ "However, that picture has shifted over the past 3 years as the gold supply moved from" oversupply to deficit. "As a result, Wells Fargo is positive for gold." Such times have had some of the strongest ones in the past Gold price rallies triggered ... We believe gold could be on the eve of a new commodity super cycle that would only be the seventh since 1800. Gold has risen more than 40 percent since 2018, and we believe there are more gains ahead of us. ”Combine that line of Wells Fargo reasoning with the prospect of rising inflation and keep in mind the Fed's statement that it is none Wants to raise interest rates in the next two years,then this actually speaks in favor of significantly increasing prices for precious metals. "(Source: "Gold:" The strongest rally is on the way " , the shareholder)
As the following chart shows, the USD gold price fell yesterday's trading history to the strong support zone at $ 1680 (in dark green) , which was captured in April last year and was confirmed as new support after several tests, whereupon a strong uptrend began in June ( from $ 1671 to $ 2089 or + 25%):
Full version / updated chart: https://schrts.co/pzAcbFwi
After the strong 25% rise, the gold price began correcting back to the $ 1680 level in August 2020 to test it again and confirm it as new support. This means that a new uptrend can now begin at any time. The accompanying indicators (TRIX and MACD) also point to a trend reversal, with their lows being much lower than in mid-2020, so that a much stronger increase can be expected (beyond the $ 2100 mark).
Should this happen , it would be the perfect time to stock up on junior gold stocks, as these typically rise much faster than (large) senior gold stocks in bull markets.
If this does not happen (and the gold price continues to weaken), it can be expected that only those gold stocks will rise that are making fundamentally significant progress (especially good drilling results or strategic partnerships with seniors).
Tocvan's big neighbors (Argonaut and Minera) have shown over the past few years that their stock prices have risen amid much lower gold prices :
Argonaut was able to successfully prove that the neighboring Colorada opencast mine is highly profitable, even if the average gold content is "only" 0.6 g / t gold. The production costs of an open pit mine in Mexico are so low that even a gold price of $ 1000 would be enough to make a profit. That was also the reason why a senior like Osisko Gold Royalties Ltd. (Market valuation: $ 2.4 billion) early on in Minera, even though the Explorer had not yet come up with a resource estimate. The $ 10 million from Osisko enabled Minera to begin construction of the mine and processing facility immediately (instead of wasting money on resource definition drilling programs).
Tocvan goes the same way as Minera! With the upcoming drill programs, Tocvan would prefer to make new discoveries outside of the Main Zone rather than resource definition drilling. The main zone is to be greatly enlarged, which means that somewhat risky drilling outside of known mineralization will have to take place. But it is these expansion wells that enable the chance of significant new discoveries, which means that significantly more returns are possible.
New video 3D animation
Source: https://youtu.be/5x2saveqTsc
Full Version / The vein systems (in red) discovered by Tocvan extend across the entire Pilar property and are to be tested with the upcoming drill program.
Tocvan is very fortunate to have a large property with Pilar that has never been systematically explored before. All previous project operators focused on the Main Zone deposit because a spectacular hit was made there in the 1990s: a fabulous 16.50 m @ 53.47 g / t gold + 53.40 g / t silver (at a depth of only 52.50 m core length; see drill hole "S-10" on page 22 in the technical report ). Derek Wood toldthat this borehole was the reason for the many drillings that were subsequently completed (> 19,000 m) in order to pursue this extraordinary drilling success (extremely high-grade over such exceptionally long lengths) and, if necessary, to repeat it. Even if this drilling success could never be repeated on this scale, very good drilling results could nonetheless be achieved (albeit in unfavorable times of longer gold price corrections). The current times are fundamentally different from before, because Tocvan has the great advantage that the gold price is much higher than ever before. Even if the gold price should correct further, Tocvan can still bring the project into production, as Minera and Argonaut made their production decisions at completely different gold prices.
A video about Tocvan's Pilar gold-silver project shows what is to come: The Phase 2 drilling program:
Source: https://youtu.be/VLIdQzM1k0Y
• As the video shows, Tocvan was able to trump the neighboring gold projects of Argonaut Gold Inc. and Minera Alamos Inc. with the Phase 1 drilling program ( see here ) , as longer and higher-grade drill sections were achieved near the earth's surface, such as 95 m 1.6 g / t gold including 9.2 m @ 10.8 g / t gold . These are world class drill results for an open pit mine in Mexico as average grades of at least 0.6 g / t gold are required, as demonstrated by Argonaut and Minera with their neighboring gold mines.
Drone videos with photos of the recent exploration work:
Source: https://youtu.be/FA_evgj3-eE
Source: https://youtu.be/H4xJRtQrsUQ
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