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Gold Explorer Stakes Copper Project Near Trend Discovery

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NevGold Corp. announced it has organically staked mineral claims in southwestern Idaho to create a new project, the Zeus Copper Project. Read on to see why one analyst says this company is headed toward a bull market.

NevGold Corp. (NAU:TSX.V; NAUFF:OTC; 5E50:FSE) announced it has organically staked mineral claims in the Hercules Copper District of southwestern Idaho to create a new project, the Zeus Copper Project.

The 4,900-acre site is about 20 kilometers southwest of Hercules Silver's (BADEF:OTCMKTS;BIG:TSXV) copper porphyry discovery announced last fall, which included drilling results of 85 meters of 0.84% copper (Cu), including 45 meters of 1.94% Cu.

Mining giant Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) invested approximately CA$30 million in Hercules for a 30% equity stake after the discovery was announced.

"We moved very swiftly with our geological review and staking campaign on Zeus, and we strongly believe that we have consolidated some of the most strategic ground in this emerging copper porphyry belt," said NevGold Chief Executive Officer Brandon Bonifacio. "The Zeus Project has many of the same geological characteristics as the Hercules Project, and our team encountered signs of copper mineralization and porphyry copper alteration while staking over recent months."

NevGold said it will continue to remain focused on expanding its "oxide, heap-leach gold resource platform in the Western USA" with its Nutmeg Mountain project in Idaho and Limousine Butte in Nevada.

"We are always looking for opportunities to create value for our shareholders," Bonifacio said. "It is also very advantageous to have another project in the district, as we have already built a strong reputation in Washington County, Idaho, and we have many relationships to leverage as we advance both Zeus and Nutmeg Mountain."

The Catalyst: New Co. Bull Market Could Start 'Soon'

Even before the announcement, the company was in "a good spot to be in going forward with gold now embarking on its biggest bull market ever," Technical Analyst Clive Maund wrote.

The Barrick investment in Hercules "should give you an idea of the potential of this new NevGold property," Maund wrote after the news. "Giving the project the name Zeus is a smart move by NevGold, because in Greek mythology, Zeus was the father of Hercules, which implies that this project is the 'Big Daddy' of the Hercules Silver big copper discovery. And of course, if it really is, then we can presume it will be found to have a lot more copper, possibly even than that." 

The Barrick investment in Hercules "should give you an idea of the potential of this new NevGold property," Technical Analyst Clive Maund wrote.

On the company's three-year chart, the analyst said a bear market in force from 2021 has run its course, with the downtrend having slowly fizzled out so that in recent months, it has morphed into a base pattern.

"The strong Accumulation line, which has shown positive divergence for many months with upside acceleration in recent weeks, strongly suggests upside resolution of the current standoff, meaning an upside breakout into a new bull market, with this being made still more likely by gold's gathering bull market," noted the analyst, who rated the stock an "Immediate Strong Buy for all timeframes."

Maund continued, "The Zeus project clearly has huge discovery potential and whatever value it generates will come on top of the company's other worthwhile projects in Idaho and Nevada . . . making the company and its stock even more attractive for investors.

Co. Moved Quickly on Claims

The Hercules discovery appears to be the first large-scale copper porphyry to be found in western Idaho and represents an entirely new province for potential discoveries in the area for the metal needed in abundance as the world pivots toward clean energy.

The Zeus project itself is about 120 kilometers northwest of Boise, Idaho, and 40 kilometers northwest of Nutmeg Mountain. The company noted the area has strong road, water, and power infrastructure, including a large network of access roads leading to the project. Its claims cover both Bureau of Land Management and United States Forest Service ground.

NevGold's experience working in the area with Nutmeg Mountain gave the company important local relationships and understandings of the geology, Vice President Exploration Derick Unger said.

"This allowed us to move quickly to secure some of the most prospective ground on the entire Hercules Copper Trend, which saw a significant increase in activity and land competition after the copper porphyry discovery hole was announced last October," Unger said. "We have spent significant time in the field completing the staking process, and our team has been encouraged with the porphyry system elements that we have encountered."

Similarities to Hercules 'Striking'

Even before the new project, analyst Stephan Bogner of Rockstone Research noted in a March 18 research note the "similarities between Hercules Silver Corp. and its neighbor NevGold Corp. are striking."

NevGold would probably not mind replaying Hercules' performance, as Hercules' stock went from US$0.20 per share to as high as CA$1.62 per share after the copper porphyry discovery, and the company now has a market cap of more than CA$200 million.

"With gold prices having marked new all-time highs recently, gold exploration and mining stocks may soon enter a strong bull market, in particular those few companies operating in favorable jurisdictions and holding resources in excess of 1 million ounces (Moz) with substantial growth upside," Bogner said.

NevGold announced a Mineral Resource Estimate (MRE) at Nutmeg Mountain last August with more than 1 million indicated ounces of gold (Au) from 51.7 million tonnes (Mt) at 0.61 g/t Au, and 275,000 inferred ounces of gold from 17.9 Mt at 0.48 g/t Au.

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NevGold Corp. (NAU:TSX.V; NAUFF:OTC; 5E50:FSE)

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It plans to explore with further drilling and metallurgical test work and work toward an updated MRE to advance the project to a Preliminary Economic Assessment (PEA).

At Zeus, the next steps will include geological mapping, geochemical sampling, geophysics scans, and drill testing on identified targets.

Ownership and Share Structure

About 37% of the company is now held by strategic investors, including GoldMining Inc., which now holds 29.4% of the company on an undiluted basis, and McEwen Mining Inc. 

The company said about 30% is held by management and insiders. According to Reuters, these include Non-Executive Chairman Giulio T. Bonifacio with 7.3%, CEO Brandon Bonifacio with 6.7%, Independent Director Gregory French with 1.62%, and Independent Director Timothy Dyhr with 1.37%, Reuters said.

About 10% is held by institutions, and the rest is in retail.

NevGold has a market cap of roughly CA$30.85 million with 93.91 million shares outstanding. The stock trades in a 52-week range of CA$0.48 and CA$0.24.

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Important Disclosures:

  1. NevGold Corp. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of NevGold Corp. and Barrick Gold Corp. 
  3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
  4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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