News Flash, Nov. 18: "E2Gold’s most recent financing became free trading this week," geologic expert Dr. Quinton Hennigh confirmed with Streetwise today. "As seen in many cases when a stock has appreciated significantly from its placement price, weak hands leave, thus presenting a buying opportunity for long-term investors. The story has not changed one bit, and the Company is sticking to their commitment to discover a major gold deposit at Hawkins," Hennigh said.
Sector expert Clive Maund recently explained in a quick update why he also has put E2Gold on his list as a great buy. You can read more here.
Several weeks ago in one of my regular calls with Streetwise Reports to
compare notes and ideas, E2Gold Inc. (ETU:TSX.V, ETUGF:OTC) was brought up to me as having had a far better year than the average junior gold explorer. A few things had already come together nicely for this company that went public back on January 4, following the closing days before of an oversubscribed private placement.
Interest was robust in that raise…the company had a high-profile ally and advocate in Dr. Quinton Hennigh…key investor in Crescat Capital…and
— last but not least — some juicy ground in the re-emerging Hemlo Camp in Ontario.
When I next looked at the company’s web site and some recent news to try to quickly catch up, I was hit with a Twilight Zone moment: when I saw that old friend Eric Owens was E2’s President/C.E.O.
Owens was President of the former Alexandria Minerals, a recommendation of mine some years ago that we did well on. Well after I’d advocated taking our last profits here, Owens parted company with Alexandria (that company’s assets—mostly in the Abitibi region—were combined with other non-core assets of Osisko Mining and now are owned by O3 Mining.)
After that split when Owens was looking for his next company-building project, he took a renewed look at some ground he’d always been interested in, but which he says “wasn’t a fit” for Alexandria previously. This area which—with added acquisitions since—now totals some 540 sq. km. seems ripe for discovery given that it is not only believed to be on the overall Hemlo-Timmins Trend but, says Owens, has not had much of a “fresh look” in 40 years, since the first discovery here by the late Don McKinnon and two others (NOTE: You can watch a really cool CBC documentary on Hemlo here.)
Right now, the only resource here is a primarily pit-constrained inferred resource, as you see above, of 328,000 ounces of gold. Drilling last winter raised confidence (in part by twinning some old Falconbridge holes here) that the geology at McKinnon is what Owens and his team are after. Presently, the company is “a little more than halfway” through an added 10,000-meter drill program: the goal is to expand the McKinnon resource’s footprint.
To the left are E2Gold’s V.P. Ellie Owens (left foreground) and her Dad Eric behind her; at right foreground is V.P. for Exploration Natalie Pietrzak-Renaud and, behind her, Jeff Pritchard, who handles Investor Relations.
Speaking of the unique Hemlo Camp geology, one of the most interesting anecdotes shared with me when I got to visit at length with Eric, Ellie and Jeff at the New Orleans Investment Conference was about Hennigh being a part of a recent presentation of the company. Once he saw what the core at McKinnon looked like, they told me, Hennigh pretty much took over the presentation. He—and Crescat, which owns about 11% of E2Gold at the moment—certainly seem to think this company has a shot at the next major discovery in the Hemlo Camp.
Aside from the exploration potential at this Project, the company recently announced it had obtained an option to purchase 100% of the Band-Ore project farther to the west. As you will read, there is a similar story here: little new exploration in 40 years, a small, higher-grade historical resource (not NI 43-101-compliant) and LOTS of exploration upside in similar geology.
While the near-term focus will remain on Hawkins, Owens told me this past weekend in a follow-up discussion after our visit in New Orleans that in the coming months they will do some greenfield work at Band-Ore and, likely, an airborne mag survey. Ultimately, he wants to raise the confidence of the company that there is the potential for volume on top of rendering the historical resource NI 43-101 compliant.
Notwithstanding the significant run that E2Gold has already enjoyed recently, I’m starting it out as a BUY. Even after this move, the company’s market cap is a mere C$23 million or so in total. That’s not much for a company with the chance to multiply its resource base in a world-leading jurisdiction by several times.
Lastly—for those of you who are U.S. investors but do NOT have an account with a broker that allows purchases directly on the Toronto market—Owens told me over
the weekend that the company expects its OTCQX listing
in the U.S. to be operational soon.
Make sure to spend some time at E2Gold’s web site: https://e2gold.ca/
Watch this recent Streetwise Live! Interview of both Owens and Hennigh.
Chris Temple is editor and publisher of The National Investor. He has had an over 40-year career now in the financial/investment industry. Temple is a sought-after guest on radio stations, podcasts, blogs and the like all across North America, as well as a sought-after speaker for organizations. His ability to help average investors unravel, understand and navigate today's markets is unparalleled, and his ability to uncover "off-the-radar" companies is likewise. His commentaries and some of his recommendations have appeared in Barron's, Forbes, CBS Marketwatch, Wall Street's Best Investments/The Cabot Group, Kitco.com, the Korelin Economics Report, Benzinga.com, Palisade Radio, Mining Stocks Education, Mining Stock Daily and other media.
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