A little quiet over here so I thought I'd start the ball rolling with some discussion on this undervalued little gem that the market seems to be missing.
- ACH, originally a private company (now Medallion Metals) acquired the tenements from Silverlake Resources in 2016. At the time, Silverlake was struggling with a few other ventures and decided to cut it's non-core investments loose. ACH scooped up the assets at a bargain price accordingly.
Original Silverlake acquisition from Phillips River Mining:
- Highly experienced management with proven previous successes in multiple ventures and plenty of skin in the game. ($22.1m spent as at 31st Dec 2020 including the acquisition costs of the project). Some very decent resumes there.
- Great jurisdiction being in WA (Ravensthorpe based) with Ravensthorpe airport close by. Ravensthorpe approx. 550km from Perth, hour & 20 min flight. Mining location is around ~17km away from Ravensthorpe town center (adjacent to main highway). MM8 also own an 89 man mining camp in Ravensthorpe. Local community supportive of resources as demonstrated by Mt Cattlin (Galaxy, ASX:GXY) and Ravensthorpe Nickel Operations (First Quantum, TSE:FQM).
- Heritage clearance, permitting significantly advanced, ministerial statement obtained (commencement can proceed when ready). Granted mining studies.
- PFS completed showing RGP project is technically & commercially viable. ~700Koz gold resource @ ~2.4g/t looking to expand this to 1.5moz ultimately with infill drilling and further exploration of the project. Current resource is open at depth and strike meaning rapid expansion highly probable. Interestingly, 92% of the current resource was drilled to an average depth of 85m – very shallow considering the type of deposit.
- As mentioned in recent interviews, there is old historical (non JORC compliant) resource estimates that have been documented by previous owners and MM8 is in the process of upgrading these resources to JORC compliant. ie: Gem restored maiden resource to be announced October 21 and added to the existing JORC resource. (additionally further exploration to be undertaken at Gem Restored - Phase 2drilling to further extend the deposit will commence in September 2021). As per the latest announcement, the northern Lode expanded beyond the initial discoveryhole. There is a significant opportunity to further expand Gem Restored and to identify repetitions of thehigh-grade plunge zones as the drilling progresses to the north.
- Talking of old historical resource estimates, there has been little mention of Gift South as yet (company keeping this one up their sleeve?) Initial results from Tectonic many years ago show some fairly promising results.
Above circled locations not part of the current JORC resource - currently being upgraded to JORC compliant via drilling underway currently.
- The AOI has multiple target lodes that are all projected to intersect – if this turns out to be the case, there’ll be a huge bonus as concentrations and widths would increase substantially in this area. Noting that this would just be a bonus as they’ll get to their 1.5moz target without it. (assuming existing results keep replicating)
- 32,000m drilling program underway to expand the resource with drilling outside the current known resource has been fruitful. Significant step outs and hitting decent grades.
- Undervalued vs peers measured @ EV / Resource.
- AISC under $900 USD (profitable even with much lower gold prices). From what I can tell, there were no copper or silver credits included in the calculations which indicates costs could be significantly lower if considered.
- Mine establishment estimate at $85m AUD.
- MM8 recently divested their Nickel tenure to Nickelsearch (new IPO). The IPO appears to have closed early according to the Automic website which would indicate the raise was successful. Upon listing, MM8 will hold ~15% of SOI in Nickelsearch in which MM8 will give consideration to transferring ownership of Nickelsearch shares to MM8 shareholders via an in-specie distribution upon the conclusion of the 12 months escrow period.
- Additional Pb, Zn, Ag, Au owned tenement (Trilogy). This was Phillip River's Flagship project. Either looking to spin this off or partnership with another miner. (JORC 2012 Mineral Resource of 5.6Mt for 134kt Pb, 77kt Zn, 67kt Cu, 9.8Moz Ag & 162koz Au. 2011 DFS demonstrates technical and commercial viability at current prices). Valuable project on its own with potentially another in-specie distribution for shareholders in the event of a sale.
Excited for the future of the company and the updates to follow over the next few months.
MM8 Price at posting:
23.3¢ Sentiment: Buy Disclosure: Held
