Greg Johnson, one of the founders of NOVAGOLD Resources Inc. (NG:TSX; NG:NYSE.MKT), has put together a platinum group metals package that mirrors the Stillwater complex in Montana, with its 80-million-ounce, 16.8 g/t PGE (platinum group elements) resource.
Greg believes the future of the PGE metals is bright. After being associated with Wellgreen Platinum in the Yukon, he began to assemble a flock of PGE projects and put them into Group Ten Metals Inc. (PGE:TSX.V; PGEZF:OTC). The big one, which they call the Stillwater West PGE-Ni-Cu project, is adjacent to the Sibanye-Stillwater series of mines in Montana. Greg's plan is to put the Group Ten company under the umbrella of his other company, Metallic Minerals Corp. (MMG:TSX.V), in order to reduce overhead and office expenses. Metallic Minerals is oriented toward silver, lead and zinc in the Keno Hills district in the Yukon.
The Stillwater West project was picked up in June of 2017 under a mostly share deal. It calls for Group Ten to own 100% of the project subject to a 2% NSR that can be bought down to 1% for a $2 million payment. It's an exceptional deal for Group Ten because it means their cash goes into the ground rather into the pockets of the vendors. It aligns the interests of the vendors with that of Group Ten. I like the deal a lot.
In November Group Ten expanded the original 282 claims adjacent to the Sibanye Stillwater mine by adding a 100% interest in an additional 17 square kilometers. In January company president and CEO Michael Rowley announced an 18-kilometer long soil anomaly of highly elevated platinum group elements at Stillwater West, in addition to nickel, copper and chromium, and picked up another 51 claims.
Putting together a package of various different claims from several vendors is what company chairman Johnson does. He did exactly the same thing with Metallic Metals. For the first time in history, the entire package has been put together into one company. There is a lot of technical data from past operators, and for now the company is focused on putting it all together in one easy-to-understand format.
Investing in Group Ten, for anyone interested in platinum and palladium, is about as difficult as learning how to fall off a bike. If you use $1,000 an ounce as an average price for platinum and palladium, the Stillwater series of mines show a US$80 billion-dollar resource. Group Ten has the same rocks, an excellent management team, tons of existing data and a US$8.5 million market cap. Do the math.
Group Ten does have one major flaw. While the name is memorable, it's for all the wrong reasons. It's a terrible name. The subject came up when Greg and I first spoke and I asked him if he was married to the name. He replied that he hated it and they were working on coming up with something more suitable. I hope so, I hated it as well.
The company has done an excellent job on both the website and the company presentation. For those who can do the math on Group Ten's doppelganger, the charts are especially interesting. I suspect Group Ten is going to be a giant surprise, also given the instability of the world's main three PGE suppliers, Russia, South Africa and Zimbabwe.
Group Ten is an advertiser. Do your own due diligence.
Group Ten Metals
$0.245 (Feb 23, 2018)
42.8 million shares
Group Ten website
Bob and Barb Moriarty brought 321gold.com to the Internet almost 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.
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1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. Group Ten Metals is an advertiser on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
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