Success in junior exploration depends on good management. Management which is able to find and acquire prospective properties and management which can evaluate those properties. But also management which can make the hard call to let a property go when it no longer makes sense for the company and its shareholders.
Enforcer Gold (V.VEIN) had high hopes for its Montalembert gold project in Quebec. There was definitely gold there but, as Steve Roebuck, President and CEO of Enforcer said in his September 1 letter to shareholders, “Although we had some spectacular assays come in, we didn’t get the results we had hoped for. The extreme nuggety gold distribution at Montalembert was a huge disappointment and the only logical course of action was to cut our losses, let it go and move on.”
Tough call, but made a bit easier because Enforcer would have had to pay the next instalment of $500,000 on the property on November 1 and had to give 90 days notice if that payment was not going to be made. Hanging onto the property did not make sense and Roebuck seemed pretty comfortable with the decision to let it go.
Some time ago Roebuck decided that Enforcer needed a second project. “We started looking in September 2017,” said Roebuck. “We were shown several projects but none really fit our plan. We were at the SOQUEM booth and they walked us through a few projects. Just when we were getting ready to move on, they said, “There’s a project which has just come back to us. 100 meters of 1 gram per ton of gold.” This was exactly what I was looking for.”
“We are earning our 50% via a three-year commitment. Year one $500,000, year two and three for $750,000, for a total of $2,000,000 and 1 million shares – and there is no underlying royalty either” said Roebuck.
The Roger gold-copper project, which hosts the Mop II deposit, is located 5 km north of the historic mining centre Chibougamau, Quebec, has all-season road access and is crossed by a power line that serviced the past-producing Troilus Mine.
The project has an interesting history having once been explored by an Italian winemaking company in the early 1980s. The winemakers were trying to qualify for shelf space in Quebec government liquor stores (SAQ) by making an investment in the province. No, really. And they even came up with a pre 43-101 resource estimate. Then the property was picked up by an actual miner and finally by SOQEUM which did a bit of drilling and came up with a 2006 NI 43-101 resource estimate of 166,700 ounces of gold.
“Between 2006 and 2017 Quebec really changed,” said Roebuck. “It took Osisko and the Canadian Malartic open pit mine but Quebec’s mining culture has really embraced bulk mining.”
“The Roger project shares a similar geology with the Malartic,” said Roebuck. “It’s a large Quartz Felspar Porphyry system and there has not been extensive drilling. And a large part of the drilling which has been done was done on 50-meter centres or greater.”
This leaves a lot of room both to step out from the explored areas and to do infill drilling. Enforcer recently announced that it had updated its 43-101 to reflect the results of its first round of drilling. The resource is now estimated at 377,000 gold equivalent ounces indicated and 365,000 gold equivalent ounces inferred.
In that news release, Roebuck is quoted as saying, “These results have surpassed our best expectations. We were optimistic that the updated resource estimate would be a significant milestone for the Company, but this new estimate is not only a marked increase in the size of the resource, it is also a very significant boost in confidence level with over 50% in the Indicated category.”
“We’re fully funded to do Phase 2”, said Roebuck. “We’re using our existing flow through dollars so we need to get the drills turning immediately.”
“I am looking to double the resource within two years,” said Roebuck. “In fact, I would like to have a million ounces on just the gold.”
“You also have to look at the district scale strategy,” said Roebuck. “Chibougamau is pretty quiet right at the moment. But there are deposits around town. I am pretty sure we could find an additional 10 or 20 million tons of mineralized material. Previous operators did a bit of metallurgical work and it processes well but now we’re looking at testing the possibilities of heap leaching which is the lowest cost processing technique. With a small mill, and possibly a heap leach pad, we could become a mining and processing hub with spokes heading out to other deposits.”
“The fact is that mines are made, not found, and I think this project fits that expression perfectly,” said Roebuck.
At press time Enforcer Gold (TSX.V – VEIN) is trading at 5.5 cents with a market cap of $3.5 M with over $1.2M cash in the bank.