With recent developments, Liberty Gold Corp. (LGD:TSX; LGDTF:OTCQB) further derisked future access to water and power for its Black Pine project in Idaho, reported Haywood Securities analyst Dr. Geordie Mark in a Nov. 29 research note.
"Our take is positive as resource potential is being concurrently married with derisking steps towards a future production outcome," Mark wrote.
He noted that Haywood has a target price on Liberty Gold of CA$2 per share, and this reflects a 413% potential return from the company's current share price (CA$0.39). Haywood rates the Canadian explorer Buy.
Mark relayed the two recent positive events regarding needed infrastructure at Black Pine.
Water Rights Added
"This amount of water far exceeds our projections needed to drive our production-orientated cash flow model," wrote Mark.
First, Liberty Gold bought the registered title to two Black Pine mine water rights, which should afford access to up to 1 cubic millimeter of water per year.
This, along with long-term lease agreements, increases water access there to 4 cubic millimeters per year.
"This amount of water far exceeds our projections needed to drive our production-orientated cash flow model and would enable the facilitation in the growth of that ore ton pad placement rate via the manifestation of a greater resource base (via discovery and or utilization of a lower cutoff grade, or both)," wrote Mark.
Power Scenario OK'd
Second, regarding power, an initial impact system study done by the Idaho Power Distribution Co. was positive for delivery of up to 10 megawatts of power per year to the Black Pine mine gate, Mark reported. Transport would be through a 25-kilowatt line from the Raft River Rural Electric Co-op.
"The transition mechanics, engineering, and costs to enable that distribution are still pending, but these facets mark a company trend to characterize and enable a pathway to project permitting, development and production," Mark noted.
More Areas To Drill
In other news, Liberty Gold applied to the U.S. Forest Service to modify the Black Pine plan of operations. The company did this because the results of a recent gravity survey on the project area showed areas where horst blocks of the basement may be present, meaning drill testing of the lateral extensions of the mineralized system could be done. These areas are in the eastern margin of Black Pine.
Also, at the project, "a sustained campaign of drilling" continues, results of which will be potential near-term catalysts for Liberty Gold's stock, Mark wrote.
"Drilling on Black Pine has gone from strength to strength since the publication of the 2021 mineral resource estimate," he added.
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1) Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures For Haywood Securities, Liberty Gold Corp., November 29, 2022
Analyst Certification: I, Geordie Mark, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.
Important Disclosures: Of the companies included in the report the following Important Disclosures apply:
Haywood Securities, Inc. has reviewed lead projects of this company and a portion of the expenses for this travel may have been reimbursed by the issuer.
Haywood Securities Inc. or one of its subsidiaries has managed or co-managed or participated as selling group in a public offering of securities for this company in the past 12 months.