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Buy These 3 Stocks Before They Surge Over 60%, Says BMO

In recent sessions, we’ve seen conflicting trends pulling at the stock market. Overall, stocks are up. The S&P 500 has a year-to-date gain of 20%,…

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In recent sessions, we’ve seen conflicting trends pulling at the stock market. Overall, stocks are up. The S&P 500 has a year-to-date gain of 20%, and the NASDAQ is up 19%. But overlaid on that, we’ve seen several down sessions in a row, and both indexes are off their peak. It’s a situation that puts investors in a difficult position, trying to decide which trend will win out as 2021 starts to wind down.

Covering the market for BMO Capital, chief investment strategist Brian Belski notes the conflict, and crunches the numbers to put it into historical context.

“Since 1950, the S&P 500 has registered a 0.48% average loss in September with positive price returns occurring only 45% of the time, both of which mark the worst of any month during the year. September also typically represents a volatile period for US stocks as the 0.88% standard deviation of daily price changes for the S&P 500 ranks second-highest after October,” Belski wrote.

So it would seem that a ‘September swoon’ is a real thing, and in the cards for investors – with volatility remaining high heading into the fall. But that’s only part of the story. Belski also points out that, “Historically, when the S&P 500 closed at an all-time high, the median stock was 12.1% off its high. When the S&P 500 closed at its latest new high on 9/2/21, the median stock was just 8.9% off its high, well-below the historical norm. In fact, during every new S&P 500 closing high since 3/26/21, the median stock has been less than 12.1% away from its high.”

Against this backdrop, Belski’s colleagues among the BMO stock analysts have been sorting through the market data, to find equities that are poised to bring solid returns – on the order of 60% or better – in the current environment. Using the TipRanks platform, we’ve looked up the details on these names, to find out what drew them to the attention of the BMO analyst team. Let’s dive in.

Zevia PBC (ZVIA)

First up is Zevia, a soft-drink company whose name comes from the stevia sugar substitute it uses in its product lines. Zevia, based in Los Angeles, California, has a full line of sugar-free energy drinks and organic teas that are also zero-calorie, gluten-free, and vegan-friendly. The company has built up its presence in the US and Canada, and is now moving to expand its sales into Western Europe, Latin America, and Asia. Zevia’s products are available in retail locations, as well as direct-to-consumer through the company website and Amazon.

Zevia went public earlier this year, in July, through an IPO. The offering saw the company put 10.7 million shares on the markets, priced at $14. The IPO ended up raising $150 million in gross proceeds. Zevia currently shows a market cap of $868 million.

Last month, Zevia released its first quarterly earnings report as a public entity. The results, from 2Q21, showed top-line revenue of $34.4 million, for a 24% year-over-year gain, and an EPS loss of 30 cents per share. Zevia reported $16.2 million in gross profit for the quarter.

BMO’s Andrew Strelzik sees Zevia as a growth story going forward, writing: “Zevia has the potential to become the dominant, scaled better-for-you beverage brand in its categories as there is no leader today. The consumer shift to better for-you beverages is in its very early days, despite consistently gaining share from traditional beverages. Zevia already has proven its ability to make real in-roads, and there is a misperception about competition as there are only a handful of better-for-you alternatives in each of Zevia's categories.”

In line with these comments, Strelzik rates ZVIA an Outperform (i.e. Buy), and his $24 price target implies a robust one-year upside of 78%. (To watch Strelzik’s track record, click here)

This newly public stock has picked up 6 analyst reviews in its short time on the markets, and they break down 4 to 2 in favor of Buy over Hold, for a Moderate Buy consensus rating. Shares are priced at $13.45 and the $19.25 average price target implies an upside of 43% in the next 12 months. (See ZVIA stock analysis on TipRanks)

Li-Cycle Holdings (LICY)

The ‘green’ economy gets plenty of headlines these days. It’s a major part of the Democratic Party’s platform, the Biden Administration has promised to promote green initiatives, and the result is a political incentive for companies to ‘go green.’ This is opening up opportunities for new, zero-emission, technologies like electric cars. The new green tech as spurred its own spin-off industries, especially in the realm of energy storage.

And that is where Li-Cycle comes in. This company lives in the battery recycling niche, working to recover reusable materials from expired lithium-ion batteries. The company estimates that, by 2030, the battery sector will generate over 15 million metric tons of used-up lithium-ion batteries. These contain unusable pollutants – but also plenty of recoverable elements. Li-Cycle offers a full service menu to recycle batteries, from collection to recycling to the secure destruction of electronic devices containing used-up batteries. The company boasts that it can recover some 95% of the material in the batteries, without sending waste to the landfills, and returning large quantities of aluminum, copper, lithium, and other elements to battery manufacturers.

Li-Cycle has been expanding its footprint in the niche, and this month announced that it is opening a new facility in Alabama for battery recovery. The new facility will have an initial capacity to generate 5,000 metric tons of manufacturing scrap annually, bringing the company’s total annual capacity in North America to 25,000 tons.

Also this month, Li-Cycle released its fiscal 3Q21 report, for the quarter ending on July 31. The company showed an impressive 840% year-over-year increase in revenues, to $1.7 million, in the quarter. The report is the company’s first as a publicly-traded entity; LICY hit the NYSE on August 11 of this year after a SPAC combination with Peridot Acquisition Corporation. The transaction brought Li-Cycle $580 million in gross proceeds.

LICY shares caught the attention of BMO analyst Robin Fiedler, who wrote: “Li-Cycle is well-funded and has a plausible pathway towards feedstock security required to reach scale and robust profitability potential. This stems from Li-Cycle's strong OEM partnerships, and proprietary recycling process expected to drive more favorable raw material recovery yields and lower environmental footprint versus peers.”

The analyst added, "We believe Li-Cycle has significant mid-term earnings potential under what we deem as reasonable key driver assumptions and capacity roll-out trajectories, with even further potential upside if management guidance is achieved."

To this end, Fiedler rates LICY an Outperform (i.e. Buy), with a $13 price target, suggesting a 12-month upside of 62.5% for the shares.

After just one month of public trading, LICY has attracted 3 analyst reviews – 2 to Buy and 1 to Hold – for a Moderate Buy consensus view. The average price target matches the BMO stance, at $13, and implies a 62.5% upside from the $8 trading price. (See LICY stock analysis on TipRanks)

Dave & Buster’s Entertainment (PLAY)

Dave & Busters has a high profile in the leisure and entertainment sector; it’s a combination of bar, sports bar, video arcade, and gaming venue for grown-ups. The company has 143 locations in the US and Canada, where patrons can eat and drink, and play games. It’s known for hosting bachelor parties – and in a testament to just how much consumers wanted to return to normal, D&B has, already in 2021, recouped its lost sales from the COVID pandemic.

That was no mean feat. By 2Q20, the company’s revenues had fallen from their pre-pandemic level near $340 million per quarter to a mere $50 million. But, as of 2Q21, the company was reporting $377 million at the top line, the best quarterly result in over two years. EPS was also up; the company showed four consecutive quarters of losses in 2020, but returned to profitability in 2021. The Q2 number, of $1.07 per share, was, again, the best in over two years – and nearly double the 57-cent estimate.

We can check in again with BMO’s Andrew Strelzik, who points out Dave & Buster’s obvious draw – that with COVID restriction lifted or lifting, people want to get out, socialize, and have a good time.

“Sales trajectory inflected mid-quarter and, despite some quarter-to-date moderation around weather and COVID, the business trajectory remains upward... A strong consumer environment and internal initiatives combined to capture strong demand for socialization. We believe the sales acceleration was broad-based across geographies, demonstrating PLAY’s resonance in the consumer climate during the quarter,” Strelzik opined.

The analyst summed up, "Shares remain attractive at only ~6x our FY22 EBITDA estimate and we see opportunities for further upside to consensus over the next 12+ months."

Unsurprisingly, Strelzik gives PLAY shares an Outperform (i.e. Buy) rating, with a $58 price target to indicate room for 61% growth in the year ahead. (To watch Strelzik’s track record, click here)

There is still some caution here, as the leisure industry generally is facing both pandemic and inflationary headwinds, but the 6 analyst reviews on PLAY include 3 Buys to balance the 2 Holds and 1 Sell. The consensus view is a Moderate Buy, and the shares are trading for $35.85. The average target of $49.17 implies ~37% upside from that level. (See PLAY stock analysis on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The post Buy These 3 Stocks Before They Surge Over 60%, Says BMO appeared first on TipRanks Financial Blog.

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Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Authored by Tsvetana Paraskova via OilPrice.com,

The key metals necessary to…

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Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Authored by Tsvetana Paraskova via OilPrice.com,

The key metals necessary to advance the global energy transition will likely drive the next commodity supercycle.

Soaring demand for lithium, copper, nickel, cobalt, and aluminum could lead to a battery metal supply crunch as early as this decade, while surging prices could reverse a decade of cost declines, analysts say.  In a world increasingly focused on sustainability and ethically-sourced raw materials, some players in the metal mining industry believe that deep seabed mining operations in remote ocean areas could have a lower impact and lower costs than the land mining of key battery minerals - minerals associated with child labor in the Democratic Republic of Congo, for example, the world’s top producer of cobalt.  

However, deep seabed mining is years away from commercial operations, at best, due to a lack of international regulations and concerns about the environmental impact of mineral extraction from the seabed in areas and ecosystems that are yet to be studied by marine biologists. 

Some companies are betting on starting deep-sea mining in a couple of years. The Metals Company, for example, which just began trading on the NASDAQ, said last week it is working to “move the world’s largest estimated source of battery metals into production.” 

“We believe we have a solution that is more scalable, secure, lower cost and lower impact than mining these minerals on land: We can produce battery metals from high-grade polymetallic nodules found on the seafloor in the international waters of the Clarion-Clipperton Zone,” Gerard Barron, Chairman and CEO of The Metals Company, said. 

Polymetallic nodules contain four essential battery metals—cobalt, nickel, copper, and manganese—in a single ore, and they have been formed over millions of years by absorbing metals from seawater. Those nodules lie unattached to the seafloor, and The Metals Company plans to use a robotic collector to gently dislodge the metal-containing rocks from the seabed with minimal disturbance to the ocean floor. 

TMC has exploration and commercial rights to three contract areas which host an estimated 1.6 billion tons (wet) of polymetallic nodules containing high-grade nickel, copper, cobalt, and manganese, in the Clarion Clipperton Zone of the Pacific Ocean—between Mexico and Hawaii—regulated by the International Seabed Authority.  

The company says its studies have estimated that the polymetallic nodules within its exploration areas are enough to electrify a quarter of the world’s passenger vehicle fleet, or would be enough for around 280 million EVs.

TMC says its proposed method of retrieving battery metals generates much less carbon dioxide than conventional mining and is more environmentally friendly. 

“It’s like picking up golf balls on a driving range,” CFO Craig Shesky told the IEEE Spectrum magazine edited by the Institute of Electrical and Electronics Engineers. 

With access to funding and the listing on the NASDAQ, TMC expects to be able to complete pilot nodule collection trials in 2022, complete environmental impact studies by 2023, and file to move from exploration phase to exploitation phase in the third quarter of 2023, CEO Barron said in the statement last week. 

Yet, TMC and other companies vying for deep-sea mining face strong opposition from environmental organizations that say disrupting the ocean would lead to losses of biodiversity and change the carbon cycle in the waters. 

Moreover, the International Seabed Authority (ISA) has not yet agreed upon regulations on how to manage and supervise the exploration and extraction of minerals from the ocean floor. 

The Clarion-Clipperton Zone (CCZ) is a “biodiversity hotspot,” Craig Smith, an oceanography professor at the University of Hawaii at Manoa, told IEEE.

Smith has led research expeditions to the CCZ, which have found species new to science. It’s not possible to mine polymetallic nodules without causing ecological damage “over tens of thousands of kilometers,” the oceanography professor says. 

“Deep-sea mining may irreparably harm ocean ecosystems before we even have a chance to fully study its impacts,” the Center for Biological Diversity says

Even some potential customers of metals extracted from the ocean supported earlier this year a call for a moratorium on deep seabed mining.  

Automakers BMW and Volvo, as well as Google and Samsung SDI, vowed not to buy metals produced from deep-sea mining until the environmental risks of the activity are “comprehensively understood.” 

Tyler Durden Sun, 09/19/2021 - 08:10
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Falcon Gold continues acquisition spree around central Newfoundland’s mineral belts

2021.09.18
Area plays, where one company makes a discovery then other companies rush in to stake ground nearby, are often the main driver of growth in…

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2021.09.18

Area plays, where one company makes a discovery then other companies rush in to stake ground nearby, are often the main driver of growth in junior resource markets.

Noteworthy Canadian area plays in recent history include Eskay Creek in 1990, Voisey’s Bay in 1995 and the Yukon’s White Gold Rush in 2010, just to name a few.

At present, the central Newfoundland region is making a strong case for the next area play of the 21st Century. Specifically, the Exploits gold belt area has become the hunting ground for Canada’s next major discovery of gold and other important metals.

Ever since New Found Gold made a blockbuster discovery in late 2019 (one of Newfoundland’s best drill intercepts ever) at its Queensway project, the Exploits Subzone has turned into an attractive destination for gold explorers, with many having found exploration success within a short period of time. NFG, too, continues to report significant drill results to this day.

One up-and-coming explorer that is continuously expanding its land position in central Newfoundland is Falcon Gold (TSXV: FG, Frankfurt: 3FA.G, OTC: FGLDF), which recently acquired two additional properties in the province, both located in strategic locations close to known mineral zones and/or producing mines.

Baie Verte Property

The first deal, announced on August 18, comprises the staking of 548 claims totaling 13,700 hectares located along the Baie Verte Brompton Line (BVBL) of the central Newfoundland belt, home to some of the province’s largest defined gold deposits.

Regional location of Falcon’s claim groups

There are more than 100 gold prospects and zones, many of which are orogenic-style, related to major splays and associated second-order structures linked to the BVBL. Falcon’s new property covers a 50 km corridor along the BVBL.

The Baie Verte Peninsula currently hosts all of Newfoundland’s gold production.

Producing mines in the region are headlined by Anaconda Mining Inc.’s Point Rousse gold mine and Rambler Metals & Mining operations. Former producing mines include the Terra Nova mine, and deposits of the Rambler mining camp. All of these mines are in close proximity to the BVBL.

Falcon’s new claims are also 13 km southwest of the Glover Island Trend, an 11 km mineralized corridor that hosts 17 base metal and polymetallic mineral prospects as well as numerous gold showings and anomalies.

These include the Lunch Pond South Extension (LPSE) deposit owned by Mountain Lake Resources, which has indicated and inferred resources of 120,000 ounces of gold (June 2017).

The new land acquisition is also proximal to the Four Corners project held by Triple Nine Resources (see map below).

Location of the new Falcon Gold land along the BVBL

The Four Corners project consists of iron-titanium-vanadium mineralized rock that has been outlined for 3,000m in strike with intercepts 200m wide and 600m vertically. This project is said to contain sufficient tonnage and grades to warrant developing a world-class mineral resource.

Great Burnt Property

Then, in early September, Falcon announced it has acquired through staking 91 claims totaling 2,275 hectares in the Great Burnt greenstone belt of central Newfoundland, which is rich in base metals.

Regional location of Falcon’s Great Burnt copper property

The Great Burnt greenstone belt is host to the Great Burnt copper zone that contains an indicated resource of 381,300 tonnes at 2.68% Cu and inferred resources of 663,100 tonnes at 2.10% Cu.

Recent drilling by Spruce Ridge Resources in the area has returned some of the best copper results across the board, highlighted by 8.0% Cu over 27.2m and 6.9% Cu over 22.7m.

The Great Burnt greenstone belt also hosts the South Pond A and B copper-gold zones and the End Zone copper prospect within a 14 km mineralized corridor.

The greenstone belt is characterized by Besshi-type massive sulphide deposits, which generally occur in thick sequences of marine sedimentary rocks. Sulphide lenses can be several metres thick and extend for several kilometres. Besshi-type massive sulphide deposits are generally copper dominant and can contain precious metals such as gold and often cobalt.

As shown in the map below, Falcon’s Great Burnt property is located right in the middle of Spruce Ridge’s land package. It is also situated 4 km west of the Crest Resources-Exploits Discovery joint venture project within the Exploits Subzone.

Location of the Falcon Gold acquisition proximal to Spruce Ridge Resources

The Exploits Subzone is known to contain deep-seated gold-bearing structures of the Dog Bay-Appleton Fault — GRUB Line deformation corridor, and is home to the high-grade Keats gold zone of New Found Gold. Falcon’s new property is located just 20 km west of the Queensway project held by NFG.

“This property not only has the potential to host important Exploits Subzone orogenic gold mineralization but also copper-rich massive sulphides that contain gold,“ Karim Rayani, CEO of Falcon Gold, stated in a news release.

Since acquiring the claims, the company has received two joint venture offers, both of which were turned down as it believes the value of the property could only go up, seeing as most of the land in the Great Burnt belt has already been tied up.

“If right next door on the same fault line these guys are hitting up to 90% Cu, and this is a VMS system, Newfoundfound is going to have multiple discoveries,”  Rayani stated in a Proactive interview.

Falcon now intends to perform a high-resolution airborne magnetic and electromagnetic survey over the entire property, integrating mineralization trends and historical results to vector its exploration efforts.

As the company tends to do extensive research before picking up a project, there’s a good chance that multiple areas of interest could emerge from exploration work.

Flagship Gold Project

Central Newfoundland is just one of the many mineral-rich areas in Canada where Falcon holds a prominent land position.

With a total area of 10,392 hectares, Falcon presently has the largest land position in Ontario’s Atikokan gold camp — bested only by Agnico Eagle and its 32,070-hectare Hammond Reef exploration project.

Central Canada project and surrounding properties

The company’s flagship project — known as the Central Canada gold mine — is located approximately 20 km southeast of Agnico’s Hammond Reef gold deposit, which has an estimated 3.32 million ounces of gold (123.5Mt grading 0.84 g/t Au) in mineral reserves, and 2.3 million ounces of measured and indicated mineral resources (133.4Mt grading 0.54 g/t Au).

The Hammond Reef property lies on the Hammond shear zone, which is a northeast-trending splay off of the Quetico Fault Zone (QFZ), and may be the control for the gold deposit. Falcon’s Central Canada property lies on a similar major northeast-trending splay of the QFZ.

The Central Canada gold mine has an interesting mining history dating back to the beginning of the 20th Century.

Between 1901-1907, a shaft was sunk to a depth of 12m, and 27 ounces of gold from 18 tonnes were mined using a stamp mill. During the 1930s, the shaft was deepened to 40m, with about 42m of crosscuts, and a 75 t/d gold mill was installed.

Diamond drilling by Anjamin Mines in 1965 returned a 0.6m intersection of 37 g/t Au. Another hole assayed 44 g/t Au over 2.1m.

A more aggressive drill program in 1985 saw Interquest Resources punch in 13 holes for a total of 1,840m, the highlight being a 1.1m intercept of 30 g/t Au.

In 2012, further diamond drilling was completed by TerraX Minerals, consisting of three holes totaling 363m, spaced 55m apart to test a 110m strike length of the main Central Canada structure. The first hole of that program cut 10.61m averaging 1.32 g/t Au, including 1.82m of 4.77 g/t Au.

Central Canada Exploration Plans

Under Falcon Gold’s ownership, an initial seven-hole, 1,055m program completed in July 2020 featured a 3m interval of 10.17 g/t Au at 67m downhole. Falcon also intersected a new mineralized zone, untested by previous operators, at 104m depth, which sampled 18.6 g/t Au over 1m.

A second round of drilling took place in November-December, with another 10 holes totalling 1,890m to complement the previous seven holes plus the three holes done in 2012 by TerraX.

By March 2021, all assays from Falcon’s inaugural drill program have been received, from which continuity of the mineralized trend containing the historical shaft was confirmed.

Encouraged by these results, the company has undertaken additional work programs on the property this year, with initial focus on the outcrop exposures and trench areas. There, the geological team will be conducting detailed structural mapping along the 275m long strike of the Central Canada mine trend. The team will also expand its attention onto the other high-priority gold targets along strike and paralleling the mine trend.

For the 2021 drill program, Falcon is planning to complete up to 20 diamond drill holes for approximately 2,000m of core. The goal is to target gold mineralization in the shaft area, and to test other excellent gold zones such as mineralized quartz-feldspar porphyries and the northern vein, also known as the No. 2 vein.

Other Properties

In addition to the Central Canada gold mine and the two newly acquired projects in Central Newfoundland, Falcon currently has five additional projects across Canada, plus one project in Argentina.

In Ontario’s Red Lake mining camp, the company has acquired a strategic land package at the Springpole West project. This property is directly tied onto First Mining Gold Corp.’s Springpole gold deposit, reported as one of the largest undeveloped gold projects in Canada, and Falcon’s property contains the same geological terrain as that world-class gold deposit.

Near Sudbury, Ontario, Falcon also has a 49% interest in the Burton gold property, located 38 km northwest of IAMGOLD’s Cote Lake deposit, which has an indicated resource of 35 million tonnes averaging 0.82 g/t for 930,000 oz of contained gold, plus an inferred resource of 204 million tonnes averaging 0.91 g/t for 5.94 million ounces of contained gold.

Falcon’s first land position in central Newfoundland was established in July 2021 with its acquisition of the Hope Brook gold property. This property is hosted within the Exploits Subzone of the central Newfoundland gold belt, contiguous to First Mining Gold, the Sokoman Minerals-Benton joint venture and Marvel Discovery Corp.

In British Columbia, the company has further work planned for the Spitfire-Sunny Boy project and the Gaspard gold claims, the latter was acquired earlier this year.

Falcon’s acquisition of the Esperanza gold-silver-copper property in La Rioja province, Argentina, was announced around the same time as the Gaspard project. Consisting of 10 mineral concessions covering 11,768 hectares, the Esperanza property is located within the Sierra de Las Minas district, which hosts a number of past-producing gold and silver mines.

Conclusion

Falcon Gold has all the elements we like to see in an exploration-stage gold junior. The company is a large landowner in a past-producing mining district, with a mid-tier gold producer, Agnico-Eagle Mines, exploring just off its northern boundary.

We also like the recent acquisitions, especially the recently staked claims in central Newfoundland. The properties are all strategically located near areas with potential to grow into a world-class gold resource, and thus could well be a game-changer.

With projects also in BC and Argentina, Falcon has a diversified portfolio of projects with a rich mining history and potentially even richer endowment of mineral resources that can be rapidly generated.

Falcon Gold Corp.
TSXV:FG, OTC:FGLDF, FSE:3FA.G
Cdn$0.105, 2021.09.16
Shares Outstanding 100.2m
Market cap Cdn$10.5m
FG website

Richard (Rick) Mills
aheadoftheherd.com
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Marvel expands land position in Central Newfoundland, next to 4Moz Valentine gold project

2021.09.18
Marvel Discovery Corp (TSXV:MARV, Frankfurt:O4T1, OTCQB:MARVF) is a junior gold explorer active in the Central Newfoundland Gold Area Play.
The…

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2021.09.18

Marvel Discovery Corp (TSXV:MARV, Frankfurt:O4T1, OTCQB:MARVF) is a junior gold explorer active in the Central Newfoundland Gold Area Play.

The Vancouver-based company has assembled a sizeable land position, over 60,000 hectares, right in the thick of the Exploits Subzone of Central Newfoundland — potentially one of the world’s last easily accessible, district-scale gold camps. 

See below for Marvel’s map of the area including the major faults shown as heavy black lines.

This summer, Marvel has been busy snapping up claims and adding to its land package.

Exploits Subzone

The Exploits Subzone of Central Newfoundland

Running from Dog Bay southwest for 200 km to Bay d’Espoir, Newfoundland’s Exploits Subzone has been neglected since the last major exploration campaigns in the 1980s. However, the last 40 years have seen incremental advancements in the understanding of gold mineralization in the camp.

The sum of this knowledge is now coming together in effective exploration models that have delivered new discoveries.

What makes the Exploits Subzone such a prime target for gold discovery? Prominent regional thrust faulting shows evidence of a long tectonic history including fluid migration.

During a period known as the Taconic orogeny that lasted from 480-430 million years ago, the continental plates of Laurentia and Gondwana collided, closing the Iapetus Ocean between them. The islands we now know as Newfoundland, Ireland and Great Britain, were crushed between the continental plates, and deep crustal breaks were created that remained as active fluid conduits for millions of years. These five major tectonic breaks are important mineralizing structures for numerous multi-million-ounce gold deposits, including Marathon Gold’s (TSX:MOZ) Valentine Lake deposit, which lies just southwest of New Found Gold’s (TSXV:NFG) Queensway discovery.

Consider that the majority of Newfoundland’s gold occurrences and exploration lie within the Exploits Subzone and are in the vicinity of the Gander River Ultramafic Belt, better known as the GRUB Line.

Fact is, to stand out from among the 30-odd gold juniors that are presently combing the island, your property had better overlie one of the deep-seated structures Newfoundland is famous for, and have a secondary structure that provides a trap for the gold mineralization. 

Victoria Lake project

The Victoria Lake project is among the most prospective of Marvel Discovery Corp’s seven Newfoundland properties.

Located within the Exploits Subzone, the property is bolted onto Marathon Gold’s 4-million-ounce Valentine gold project, which is Atlantic Canada’s largest undeveloped gold resource.

Victoria Lake and Valentine exhibit a similar style of gold-bearing veins and have structural and geological settings in common. Preliminary work on Victoria Lake identified several quartz-arsenopyrite veins returning grab samples ranging from 15.5 to 24.9 g/t gold and 18.6 to 139.3 g/t silver.

In 1995, grab samples from Vein #3 featured 162.7 g/t gold and 220 g/t silver.

Regional geological and structural location of the Victoria Lake gold project.

This week Marvel announced it has acquired an additional 53 mining claims at Victoria Lake comprising 1,325 ha, increasing its land position to 7,650 ha. The company says the acquisition is located along the Exploits Subzone and covers a large, highly prospective structural zone proximal to the Valentine Lake Shear Zone hosting Marathon Gold’s (TSXV:MOZ) Valentine Gold Project with resources of 4M oz. of gold…

Victoria Lake Gold Project is host to interpreted extensions of the Valentine Lake Shear Zone and two major thrust faults, a wide structural corridor interpreted to play an integral part in the Marathon Gold Deposit.

The project is contiguous to Marathon’s Valentine gold project which has a 4Moz resource.

In fact the claims, acquired via an option agreement with a vendor, contain the highest regional gold-in-till sample — 785 parts per billion (ppb) Au. This high-grade surface gold area was never followed up with additional exploration, making it a juicy target for Marvel Discovery Corp.

“These claim additions were a strategic move, not only in expanding the size and potential, but tying up ground with the highest gold till-in-soil samples in the province of Newfoundland,” Marvel CEO Karim Rayani commented in the Sept. 14 news release. “This shows we are in the right place for a potential discovery adjacent to what will likely become Newfoundland’s next and largest gold mine.”

In a recent video interview, Rayani noted that the vendor, Roland Quinlan, is the same owner who sold part of the Queensway project to New Found Gold, the first mover in the Central Newfoundland Gold Area Play. 

“He’s one of the bigger names in the game,” Rayani told Proactive Investors’ Steve Darling, adding that Quinlan is heading up prospecting on Marvel’s Slip property claims and will also be in the field at the Victoria Lake project.

“If we do this right we could be sitting on a very large system. We’re just looking forward to getting crews on the ground as soon as possible,” Rayani said in the video interview. 

Under the option agreement, Marvel will make a series of cash payments over the next three years, and issue the vendor up to 500,000 shares and 300,000 warrants. Marvel also agreed to spend at least $60,000 exploring the property before the three years is up. The vendor retains a 2% NSR, of which Marvel has the right of first refusal to purchase 1% for $1.5 million.

Recent successes

The Central Newfoundland Gold Area Play continues to deliver great results to the market during a busy summer of drilling.

Earlier this year Marathon Gold updated the resource at its Valentine gold project, in a technical report outlining 3.14 million ounces in measured and indicated, and 1.65Moz inferred. (proven and probable reserves of 2.05Moz)

The feasibility study envisions an open-pit mine with average annual gold production of 173,000 ounces, over a 13-year mine life.

Marathon Gold trades on the Toronto main board at $3.23 per share with a market capitalization of $785.1 million. The latest fire assay results from ongoing in-fill drilling at the 1.5-km-long Berry deposit include 22.97 g/t Au over 6m, 25.38 g/t Au over 4m, 2.50 g/t Au over 27m, 1.73 g/t Au over 39m and 3.04 g/t Au over 22m.

Labrador Gold (TSXV:LAB) is another company piquing interest in Newfoundland gold exploration. Earlier this year the Toronto-based company released an impressive half-meter (0.5m) intercept of 276.56 g/t gold at its Kingsway project located near Gander, NL. The company followed that up with a 128.51 g/t over 1.12m hit at the Big Vein zone, part of a collection of assays delivered from the current 50,000m drill program. LAB currently trades at $0.78 per share and has a market value of $118.1 million.

Exploits Discovery Corp (TSXV:NFLD) reported 194 g/t visible gold at its Little Joanna prospect, along with 613 g/t Au and 189 g/t Ag at the Quinlan Veins target of its Dog Bay gold project. A large vein system with historical grab samples (700 g/t Au) containing visible gold is being drill-tested at Jonathan’s Pond, with prospecting, soil and rock sampling taking place at NFLD’s Mount Peyton, Dog Bay and True Grit projects. Results from the initial round of drilling are expected in early October. Exploits Discovery closed on Friday at 64 cents share @ a market cap of $53.4M.

Trading at just 13 cents, MARV has impressive accretive value compared to its peers.

Conclusion

The Exploits Subzone of Central Newfoundland is on its way to becoming the world’s next large gold district.

Companies are busily drilling the area and the first movers, including New Found Gold, Marathon Gold and Labrador Gold, are banking high-grade intercepts worthy of investor interest.

The area’s faults and subfaults have shown a long history of fluid migration. Central Newfoundland’s five major tectonic breaks can be traced back some 400 million years.

These deep crustal breaks are important mineralizing structures for hosting multi-million-ounce gold deposits. The potential is evident in Marathon’s Valentine deposit and at New Found Gold’s Keats, Lotto and Golden Joint zones.

Today, Central Newfoundland is home to a number of up-and-coming gold explorers looking to become the next Marathon or NFG, and competition for land is growing fierce.

Having established itself as a major landowner with seven projects in this highly prolific region, Marvel represents an intriguing opportunity for investors looking for the next gold play in Central Newfoundland.

Marvel Discovery Corp.
TSXV:MARV, Frankfurt:O4T1, OTCQB:MARVF
Cdn$0.13, 2021.09.17
Shares Outstanding 73.8m
Market cap Cdn$10.2m
MARV website 

 Richard (Rick) Mills
aheadoftheherd.com
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