New Carolin Gold Comes Back From the Dead
New Carolin Gold is another of those stocks that got hammered between 2011 and 2014 going from $1.85 to a low of $.10. They ran out of money and management bandwidth at the same time while sitting on top of a 36 km strike length gold system near a highway in mining friendly British Columbia. Sigh!!!
For most of the last twenty years the majors have been consuming their seed corn. In the early years of this century they began shutting down their exploration arms. Now they have to do deals to get replacement ore. And those deals are about as common as hen’s bracelets. As juniors dream of growing and becoming a mid-tier and perhaps down the road, a major; the majors are slowly turning into juniors.
There have been a number of prior production deposits that juniors have visions of turning back into mines. One company that I both invested in and wrote about is named New Carolin Gold. (LAD-V) They own 100% of the Ladner Gold Project where the Carolin mine is located.
The project is located 150 km east of Vancouver and is only 6 km off the major Coquihalla Highway, a major artery in British Columbia. A 43-101 released in 2015 on the 100% owned property showed an inferred resource of 485,000 ounces at an average grade of 2.11 g/t Au using 1 g/t Au as a cutoff grade.
The Carolin Mine is fully permitted for 1300 tons per day. It has a tailings facility with expansion potential and power/water nearby.
It should be no big surprise to resource investors that mining is a capital-intensive business. When gold was in excess of $1900 in 2011 new money flowed freely into the sector. In the crash from 2011 to 2015 that money flow stopped and many viable projects died on the vine. New Carolin was no exception.
At a market cap of $6 million CAD, investors are paying about $10 an ounce USD for gold in the ground at Ladner. Like many others I suspect a major crash in the stock and bond market will wake investors to the very real opportunity in shares in gold mines.
Shares in New Carolin are a pure option, a cheap option, on the price of gold. While I think gold and shares may tumble into the Tax Loss Silly Season ending in late December, LAD shares are cheap now. Any improvement in the investment climate for resource stocks or higher price for gold would almost certainly drag the share price for New Carolin along for the ride kicking and screaming.
For the first time in years, management is moving forward at Ladner aggressively. There will be a series of announcements and results coming on a regular basis.
New Carolin Gold is an advertiser. I have participated in the latest PP and as such I am biased. Do your own due diligence.
New Carolin Gold Corp