How the 'Best Gold Project in Canada' Just Got Better

New Found Gold Corp. (NFG:TSX.V; NFGC:NYSE.American) is a Canada-based mineral exploration company engaged in the acquisition, exploration, and evaluation of resource properties with a focus on gold properties located in the provinces of Newfoundland and Labrador and Ontario, Canada.

The firm's flagship Queensway Project consists of approximately 87 mineral licenses, including 6,043 claims comprising approximately 151,075 hectares of land. This project is located over 15 kilometers west of Gander, Newfoundland and Labrador, just 18 kilometers from Gander International Airport, and is home to the Jackpot feature.

New Found Gold also owns a 100% interest in the Lucky Strike project in Kirkland Lake, Ontario, comprising approximately 11,684 hectares, as well as a scattered portfolio of different mining and royalty interests throughout northeastern Ontario.

The Catalyst: New Assays from the Jackpot Project

On September 5, the company announced the results from 30 diamond drill holes that were completed as part of a follow-up drill program designed to test the new Jackpot discovery located 2.5 km north of Keats along the highly prospective Appleton Fault Zone (AFZ). 

Jackpot is a new discovery that was announced on June 22 with the discovery hole interval of 95.7 grams per tonne gold (g/t Au) over 3.25 meters (m) in NFGC-23-1292 intercepted at a vertical depth of just 20m and situated 280m east of the AFZ.

Follow-up drilling was designed to efficiently determine the orientation of the vein for continued expansion drilling. 119 g/t Au over 4.10m in NFGC-23-1425 and 147 g/t Au over 2.70m in NFGC-23-1423 are located 20m down-dip and 15m along strike, respectively, of previously the reported NFGC-23-1292.

At that time, Technical Analyst Clive Maund explained that, in his opinion, the firm had "BIG upside potential" as "the best gold project in Canada."

All three intervals occur at a vertical depth ranging from just 20m-40m.

Initial drilling indicates that Jackpot is an approximately east-west striking, steeply north-dipping high-grade gold-bearing fault that is laced with coarse-grained visible gold.

New Found Gold COO Greg Matheson explained that "Jackpot is another exciting discovery for our team, delivering exceptional high-grade and near-surface gold mineralization a full 2.5km north of our flagship Keats zone."

"The caliber of today's intercepts speaks to the growing mineralized canvas at Appleton North and demonstrates that these newly identified structures are host to high-grade mineralization akin to many of our better-defined zones to the south."

"Similar to Lotto, Jackpot is characterized by the presence of an abundance of coarse gold that is associated with a substantial brittle fault and quartz veining. One drill is incrementally stepping out on this new discovery to follow it along strike and to depth with additional results expected in the near term."

In addition to the work at the Jackpot site, the firm is currently undertaking a 500,000m drill program across the Queensway holdings, with approximately 36,400m of core pending assay results.

Why This Sector? Premium Metal, Premium Location

Gold remains a primary mining target around the globe, but the truth remains that most viable gold mining projects are located far afield of North America in jurisdictions with spotty records regarding relationships with international mining firms.

As INTERPOL pointed out in a 2022 report, this reality means that much of the world's easily minable gold is not actually available to white market actors.

Bob Moriarty of 321gold recently observed,  "Their assay results are so outstanding that they're the best I have ever seen. No one I know is smart enough to even guess at how much gold New Found Gold has."

"In the context of COVID-19, illegal gold mining has been lining criminals' pockets more than ever before, allowing crime groups to funnel money into other illicit activities while destroying the local environment," according to Cindy Buckley, Acting Assistant Director of INTERPOL's Illicit Markets division.

Even in jurisdictions where health concerns are a priority, the mining process can remain quite dangerous. As Henry Wilkins reported for The Voice of Africa in 2021, "Terror attacks on gold mining operations in Burkina Faso are becoming a regular occurrence.

So, while there remains a fair amount of gold out there to be mined, not much of it turns up in relatively safe and stable jurisdictions like Canada, where New Found Gold is located.

Why This Company? 'Best Gold Project in Canada'

On August 2, COO Matheson said, "We've been itching to get the drill bit turning back at QWS, given the great success of our first program completed in the fall of 2022. From my experience with early-stage exploration projects, it is rare to have this kind of success on an initial pass, with 27 of 33 holes hitting significant gold mineralization."

At that time, Technical Analyst Clive Maund explained that, in his opinion, the firm had "BIG upside potential" as "the best gold project in Canada."

Why Now? Looking Better Than Ever

In an updated opinion published on September 4, Maund re-upped his claim, explaining that "Eric Sprott has been accumulating New Found Gold in a persistent manner in recent weeks and 'Bob Moriarty of 321gold recently observed, 'Their assay results are so outstanding that they're the best I have ever seen. No one I know is smart enough to even guess at how much gold New Found Gold has.'"

"On the 39-month chart," Maund explained, "we can see the very strong runup that occurred during the 2nd half of 2020 and the 1st half of 2021 and how it was followed by a quite severe bear market reaction that bottomed a year ago last September. On this chart, we can also see how the Cup & Handle base is forming beneath a broad band of quite strong resistance arising from the extensive trading in the CA$7 – CA$9 zone during the last half of 2021 and the first half of 2022. Once this resistance is overcome, a major bull market advance should follow."

"Since New Found Gold is getting closer and closer to breaking out of the giant base pattern, it is rated more of a buy than when we first looked at it, and it is at a slightly better price. Given its massive resources, this looks like a great stock to own since its upside is potentially massive once gold really gets moving, which is only a matter of time with paper assets set to eventually approach their intrinsic value, which is zero."

On June 7 this year, analyst Ron Struthers shared similar sentiments. "It is amazing and reflects how bad this market is with New Found Gold Corp. at these prices and reporting drill holes that can only be described as spectacular. It reminds me of Kirkland's Fosterville discovery, which is the lowest-cost gold mine in the world because the grade is very high."

He reported New Found Gold VP of Exploration, stating that "Discovering high-grade gold mineralization of this magnitude over such a thick interval is rare in nature, and yet, Queensway has produced several of these high-caliber hits across a multitude of zones."

"I don't know how long we can buy NFG at these cheap prices," he concluded, writing that "the stock did pop about US$0.70 on the news, so there might be a pullback, and why I have a Strong Buy below US$6.50."

Ownership and Share Structure

According to Reuters, 5.25% of New Found's shares are held by management and insiders. Founder, CEO, and Chairman Collin Kettell has 2.90%, with 5.16 million shares, and President Denis Laviolette has 1.22%, with 2.18 million.

39.97% is with strategic investors. Palisades Goldcorp Ltd. has 26.30%, with 46.77 million shares. Sprott Mining Inc. has 13.67%, with 24.30 million, and 2176423 Ontario Ltd. has 4.98%, with 8.86 million.

3.53% is with institutional investors. Van Eck Associates Corp. has 2.71%, with 4.81 million shares, and Integrated Advisors Network LLC has 0.38%, with 0.68 million.

The rest is in retail.

According to its website, New Found has a market capitalization of $1.069 billion, with 179 million basic shares outstanding and 12.5 million options. It has cash and marketable securities totaling US$47 million.

Important Disclosures:

1. Owen Ferguson wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
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