We're heading into what ought to be the seasonally strongest stretch of the year for silver and gold. Both metals dipped briefly mid-week thanks to geopolitics. The children are back from recess and have gone right back to flinging spitballs at one another. Let's hope the fools don't wreck the world's financial system in a fit of insanity, but it's anyone's guess. In a sane world, this would be a fine moment to put money into the metals and into resource shares.
Way back in the stone age of resource investing, there were stretches when dozens of gold and silver stocks traded for less than the cash sitting in their coffers. In 2000, when gold and silver were under 8% of what they fetch today, there were literally a hundred or more companies you could pick up for less than the cash on their books, betting that the CEO would turn up with either a dead horse in his bed or a ruinous crack habit and the outfit would shut its doors. Back then those companies were worth a lot more dead than alive. It happened again in late 2015, when heaps of juniors were sitting on more cash than their entire market cap. And once more, gold and silver were a sliver of today's prices.
I was going through a recent press release from one of our advertisers a couple of days back and something struck me as odd. I'd bought the stock because of its tiny market cap. When I read the release and checked the current price, it dawned on me that the company was trading just a hair above its cash and liquid assets.
The company is Aben Gold Corp. (ABM:TSXV; ABNAF:OTCQB), and the press release covered their planned 1,500-meter drill program at their Justin tungsten/gold project in the Yukon, kicking off this month. But with a market cap of just CA$5 million as I write this, the company holds CA$3.5 million in the bank, another CA$420,000 in Kingfisher shares, and yet another slug of Kingfisher shares worth CA$500,000 coming in December. So, you've got a market cap of just over CA$5 million against CA$4.4 million in real assets and cash.
They'll be drilling the Justin property soon. For years, despite solid gold results, tungsten's price never made drilling worthwhile. But with WO3 jumping 700-900%, the math finally adds up.
The drilling plan as it stands calls for six diamond drill holes across three drill pads. Aben will punch roughly 500 meters into the POW tungsten/gold property, which has posted good gold and tungsten figures in earlier drilling. The POW zone carries potential for both tungsten and a RIRGS gold system.
Hole JN11009 came back with 1.25 grams per tonne (g/t) gold (Au) over 60 meters. Hole JN11010 assayed 2.52 g/t Au and 29.53 g/t silver (Ag) over 12 meters. Later tungsten assays showed 0.25% WO3 over that same 12 meters. At roughly US$300 today per kilo, that 0.25% tungsten return works out to US$750 a tonne for WO3. Another hole, JN12016, returned 5.5 meters running 4.12 g/t Au, plus 0.39% WO3 over 8.5 meters, good for nearly US$1,200 per tonne.
The rest of the diamond drill program will target the Lost Ace zone, hunting for structurally controlled high-grade gold. Earlier trenching turned up 20.8 g/t Au over 4.4 meters and 88.2 g/t Au over 1 meter.
Mobilization starts shortly and drilling should get going around August 9. Expect assay results roughly two months after that.
Aben Gold is an advertiser. I've bought shares in the open market and taken part in past private placements. That makes me biased. Do your own due diligence.
Important Disclosures:
- Bob Moriarty: I, or members of my immediate household or family, own securities of: Aben Gold Corp. My company has a financial relationship with: Aben Gold Corp. My company has purchased stocks mentioned in this article for my management clients: None. I determined which companies would be included in this article based on my research and understanding of the sector.
- Statements and opinions expressed are the opinions of the author and not of Streetwise Reports, Street Smart, or their officers. The author is wholly responsible for the accuracy of the statements. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Any disclosures from the author can be found below. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
- 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.
