Money is about to start coming into Newrange Gold Corp (CVE:NRG) in a fairly big way, and chief executive Bob Archer is in no two minds about what he wants to do with it.
“We’ll spend the cash on drilling,” he says unequivocally.
The reason is simple. Newrange’s Pamlico gold project in Nevada has already been the subject of a significant sampling programme, with particular focus on the three former producing mines on the property.
So far the sampling has confirmed what the company had surmised from knowledge gleaned from the three formerly worked mines on the property: this is a high grade area.
Indeed, Archer notes that when the mines at Pamlico were in production in the late 19th century they accounted for some of the highest grading ore coming out of anywhere in Nevada.
And anyone who’s in mining knows, that’s saying something, since Nevada is one of the most prolific and attractive gold mining destinations in the world.
This is a fact that’s not lost neither on Archer, nor on others in the industry. At the recent Beaver Creek Precious Metals Summit in Colorado, he was able to line up 45 meetings with various parties. And some have wanted to take it further, too.
“We’ve already had expressions of investment interest,” he says.
Why is this, given there’s so little actual data to go on at this stage? Answer: people know the area, like the geology and are fully aware of the area’s past history of high grade production.
So, with all that in the background, getting on and drilling makes all the sense in the world.
Of course, in this market, it’s easier said than done to raise money for exploration. But Archer is a wily operator with years of experience under his belt these days, and he knows that there’s more than one way to skin a cat.
So, whilst shareholders might balk at having to undergo any form of equity financing, they’re less likely to object to the sale of peripheral assets that are no longer a core focus for the company.
To that end, Archer has just concluded the sale of one property and is working on another that, together, should keep Newrange financed for some time to come.
“Both deals should bring in between C$2mln and C$3mln in non-dilutive financing,” says Archer, albeit that the payments are staged and some of it is coming in shares.
The assets that he’s saying goodbye to are in Colombia, itself more of a risk than Nevada, and are prospective for gold porphyries, a high risk-high reward proposition even in the best of markets.
For a junior miner capitalised at less than C$15mln, gold in Nevada seems a better bet, especially when the most recent samples show grades as high as 12.8 grams per tonne gold and 27 grams per tonne silver.
Of course, it’s pretty early days at Pamlico too, as Archer readily concedes.
Drilling will have to be fairly extensive next year if Newrange wants to close out 2020 with a resource. But the early signs are favourable. There’s the former mines themselves, the high grade samples, the 1.5 kilometres strike length, and the possibility that below the floors of the valleys that separate the three mines it could all be joined up in one massive system.
That’s an enticing prospect, and one that will have investors and potential enquirers holding their breath as the drill rigs get set to turn and the results start coming in.