Get the Latest Investment Ideas Delivered Straight to Your Inbox.

TICKERS: USGD; USGDF, NVO; NSRPF

American Pacific Mining Drilling Tuscarora Gold Project
Contributed Opinion

Source:

Bob Moriarty Bob Moriarty of 321 Gold profiles a company that has taken over a high-grade gold exploration project from Novo Resources.

American Pacific's Tuscarora Project

In 2014 my favorite gold junior, Novo Resources Corp. (NVO:TSX.V; NSRPF:OTCQX), did a deal on a small project in Nevada named Tuscarora with some barn burning historic results. Naturally since the main focus was on Western Australia in 2016 when Novo announced high-grade bonanza results such as 143.5 g/t over 1.52 meters, the market only yawned.

Novo didn't pay much for the project and since it took attention and resources away from their primary focus, when the opportunity came up to vend it into a new junior and recover 100% of their costs, Quinton took it. In November of 2017 announced a deal with American Pacific Mining Corp. (USGD:CSE).

The terms call for American Pacific to pay Novo $375,000 and to issue $200,000 worth of shares spread over three years and to expend $100,000 each year in exploration. There was an existing 2-4% NSR on the 24 unpatented mining claims in Elko County. Novo added an additional 0.5% payable to themselves.

American Pacific's Tuscarora Project

It's always nice to drill a home run hole with 143.5 g/t gold grade but even better when you can pick up such a project essentially for peanuts after someone else already found the vein system for you. In 1995 Quinton Hennigh was working for Newcrest when they drilled the Navajo vein at Tuscarora. They reported 30 g/t gold for 1.5 meters, 182 g/t gold at 1.5 meters and 51 g/t gold at 1.5 meters. In the East Pediment vein Newcrest reported 28.2 g/t Au for three meters and 4.6 g/t Ai for 1.5 meters.

When Novo drilled in 2016 they hit the bonanza hit of 143.5 g/t over 1.5 meters and 21.5 g/t Au over 1.5 meters. American Pacific got their drill permit for Tuscarora on the 17th of April and began phase 1 of a planned 19 hole program as the drills began turning. Their plan is to complete 10-12 holes, check the results when the assays come in and then complete the program.

American Pacific's Tuscarora Project

We know from past results from both Newcrest and Novo that there are multiple bonanza grade veins at Tuscarora. Novo didn't have the bandwidth to focus on the project. American Pacific has three million dollars in the bank and can focus. When results come in, I expect a revaluation of the shares.

As of now the company has a market cap of about $10 million CAD. There are warrants outstanding at $0.35 that can be accelerated at $0.50 that will bring in enough money for a follow up drill program.

If you think gold mining companies have value and will go up as gold goes up, American Pacific is a really easy to understand story. It's a Quinton Hennigh project with 23 years of his thinking about it. Novo didn't have the bandwidth to do Tuscarora right so they vended it to a new company run by people Quinton is comfortable with. They know where the veins are, they need to define a minable resource and either vend it out to a major or mid-tier or put it into production themselves.

American Pacific's Tuscarora Project

With another 5,000 meters of drilling planned I would expect American Pacific to start planning on a 43-101 resource. They need 1-2 million of a high-grade resource to be taken seriously and frankly I wouldn't even guess what they might have. But when you are dealing with 1.5 meters width of ounce-plus material you can figure out the strike length and depth and do a back of the envelope calculation.

Look for results to start coming out in six weeks or so. The stock could be explosive especially if the summer rally has started.

American Pacific is an advertiser and I have participated in two private placements. I know the management well and like them a lot. They did a good deal on the project and are in a perfect position to move this significantly forward. I am biased so do your own due diligence.

American Pacific Mining
USGD-C $0.355 (May 03, 2018)
USGDF-OTCBB 32.6 million shares
American Pacific website.

Bob and Barb Moriarty brought 321gold.com to the Internet almost 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: American Pacific and Novo Resources. American Pacific and Novo Resources advertisers on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for 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. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of American Pacific, a company mentioned in this article.

Photos courtesy of the author.




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