Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


Junior Begins Placer Gold Recovery at BC Project

View Important Disclosures for this Article
Share on Stocktwits


Omineca Mining and Metals Ltd. says the recovery of gold-bearing gravels from its flagship Wingdam placer gold project has begun. Find out why one analyst is seeing a substantial return on the company's stock.

Omineca Mining and Metals Ltd. (OMM:TSX.V; OMMSF:OTCMKTS) announced that the recovery of gold-bearing gravels from its flagship Wingdam placer gold project in British Columbia's historic Cariboo mining district has begun.

The company said 10.25 ounces of placer gold (Au) with 90.9% Au purity was recovered from the first 2.5 meters of advance into the paleochannel in Crosscut #3.

Once Crosscut #3 and Crosscut #4 "have reached the center of the paleochannel, mining will commence both up and down from each crosscut within the channel," noted Research Capital Corp. analyst Bill Newman in an updated research note Friday.

"The excavation between Crosscut #3 and Crosscut #4 will target the center of the portion of the paleochannel where the highest concentration of gold is expected to be encountered," wrote Newman, who rated the stock a Speculative Buy with a target price of CA$0.55 per share, a nearly 360% increase over its CA$0.12 price per share Friday morning. "We expect additional gold recovery results could be a near-term catalyst for the stock."

Newman also noted the condition of the recovered gold was "positive news."

"The gold is coarse (nuggety), exhibiting characteristics of a very low transport distance from the lode source," he wrote. "OMM plans to provide regular updates as the company advances deeper into the paleochannel, targeting the expected higher gold grades near the central portion."

Technical Analyst Clive Maund also recommended the mining company as a Speculative Buy in August 2023.

The Saskatoon, Saskatchewan-based junior exploration company is pursuing 2.4 kilometers of a rich, placer gold-bearing channel buried 50 meters underneath Lightning Creek in Cariboo.

Geologist Stephen Kocsis described the channel as "containing some of the highest placer gold concentrations historically reported in all of the Cariboo mining district and perhaps British Columbia that remains unmined."

The Catalyst: Golden Timing

In its release on the gold recovery, Omineca said it couldn't be happier about the timing. Prices for the yellow metal were still above US$2,300 an ounce after

According to Reuters, gold prices climbed Friday "en route to their best week in five."

Omineca noted that "although the project has experienced substantial delays, the price of gold is now significantly higher than when activities at Wingdam were reinitiated. The immediacy of recovering and processing gold from the paleochannel has the company delivering gold ounces into an extraordinarily strong market price."

Spot gold rose 0.71% to US$2,362.49 per ounce Friday, while U.S. gold futures for June delivery rose 1.26% to US$2,369.60 per ounce, Reuters reported.

Research Capital Corp. analyst Bill Newman also noted the condition of the recovered gold was "positive news."

"Investors are now looking forward to the U.S. producer price index and consumer price index data due next week, both of which could significantly impact gold," Reuters noted.

Some analysts are predicting a bull market for gold. Veteran investor Jim Rogers is predicting that it "will go very high" on buying pressure from retail investors, institutional funds, and central banks in developing countries.

"Gold prices have been down for many years. In the recent months, it started moving," Rogers told Business Today TV. "Whenever a commodity, which has been static for a long period, starts moving, it gathers momentum. That's what is happening with gold right now. The momentum is building, and who knows how high the gold rates will go."

Recoveries Comparable With Previous Bulk Sample

The initial thickness of the gravels exposed in the face overlying bedrock where the recovery was made was about 0.5 to 1 meter, "which is expected to increase in thickness as the bedrock rim dips toward the center of the channel flood," Omineca said.

"These initial recoveries are still in large part at the bedrock interface and are comparable with recoveries in the similar peripheral area of the channel at the 2012 bulk sample ("Crosscut #1") location," the company noted.

Reaching the center of the paleochannel, the company will work both up and downstream from each crosscut within the channel. 

streetwise book logoStreetwise Ownership Overview*

Omineca Mining and Metals Ltd. (OMM:TSX.V; OMMSF:OTCMKTS)

*Share Structure as of 2/8/2024

"In this type of paleochannel setting, the largest amount of placer gold tends to be in the lower points of the central portion of the paleochannel where through natural waterborne gravity sorting, the highest concentrations of heavier materials, like gold, settle," Omineca said. "This feature was noted in the bulk sample crosscut where of the 173 ounces recovered from a 23.5-meter crosscut, approximately 75% of that amount was produced from a 5.5-meter section in the middle of the channel."

Ownership and Share Structure

The company said 31% is owned by insiders and management and others, including President/Chief Executive Officer Thomas MacNeill with 4.11% and Chief Financial Officer/Director Andrew Davidson with 1.92%. The rest, 69%, is retail.

Omineca has 178 million shares outstanding and 167 million free float shares.

The company's market cap is CA$22.25 million, and its 52-week price range is CA$0.05−0.15 per share.

Want to be the first to know about interesting Gold investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter. Subscribe

Important Disclosures:

  1. Omineca Mining and Metals Ltd. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Omineca Mining and Metals Ltd.
  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. 

For additional disclosures, please click here.

Want to read more about Gold investment ideas?
Get Our Streetwise Reports Newsletter Free and be the first to know!

A valid email address is required to subscribe