The mining industry has always been home to more than its fair share of canny promoters, but Canadian-listed play Novo Resources — the company behind a gold frenzy in Western Australia’s Pilbara — has taken things to the next level.
The company’s managing director, Quinton Hennigh, was not going to use his presentation to the world’s premier gold conference, the Denver Gold Forum in Colorado, to simply run through the usual procession of PowerPoint slides.
Instead, Novo organised a live cross to the Pilbara where, in the middle of the night at just after 1.20am WA time, his team was standing by with metal detectors and jackhammers ready to start digging up gold nuggets.
His opening remark to the conference? “You get to witness the discovery of a gold deposit today.”
Within 10 minutes, in front of the live audience back in Colorado, the team — including one exploration manager wearing a cowboy hat — were pulling nuggets out of the ground. The biggest nugget appeared to be about an inch long.
Whatever the cost of the live feed, it was worth it. Novo shares soared by 27 per cent, or $1.39 each, over the course of the trading day, adding an incredible $C180 million ($183m) to its market capitalisation. Not since Crocodile Dundee took the US by storm in 1986 has a movie of cowboy hat-wearing Aussies running around the outback had such an impact in North America.
Novo’s theory is that the conglomerate-style gold mineralisation at its Purdy’s Well project is an analog of the world-beating Witwatersrand gold reef of South Africa.
The company’s success has also rubbed off on several locally listed stocks.
Novo’s joint venture partner is ASX-listed Artemis Resources, which has now more than quadrupled in value since Novo started finding gold in July.
Minnow Kairos Minerals this month raised $1.7m at 1.9c a share to fund its hunt for similar mineralisation on its ground next door to Novo, and has already seen its shares double in anticipation.
And, as DataRoom reveals today, Calidus Resources is in the process of raising up to $10m to fund its exploration joint venture with Novo, with Novo itself chipping in $1.5m worth of the new funding.
Long-toiling Pilbara explorer De Grey Mining is also tapping into the hype. It has already recorded a 70 per cent jump in its shares in the past month and, after the close of market yesterday, revealed it had unearthed 91 gold nuggets during early-stage exploration at one of its Pilbara gold prospects.
AVB Price at posting:
10.0¢ Sentiment: Buy Disclosure: Held
