Cartier Resources (ECR.V) is a multi-project exploration company operating in Quebec’s prolific Abitibi Greenstone Belt. CEO Philippe Cloutier spoke to me on the phone a few days ago.
“This is a very busy year-end,” said Cloutier. “We are working on several fronts from preparing a drill program to monitoring progress on the Chimo Mine PEA. Our stock and the market at large are taking a beating. However, we have 6.5 million dollars in the bank and a lot to look forward to early 2022.”
Cartier’s flagship project is the Chimo Mine with over 2 million ounces of gold in the indicated and inferred categories. “We are working on a PEA (Preliminary Economic Assessment),” said Cloutier. “We’ve brought in 2 million ounces at a cost of $13 million dollars. That performance has opened up a lot of doors for us and coincidently our undervalued share price is testing the patience of our retail shareholder base.”
Bringing a project to the PEA stage is a time-honoured way for an exploration company to create value for its shareholders. The company drills, discovers, delineates and de-risks a deposit and then sells it on to a larger company for development. It can be a very profitable venture, especially when, as was the case at Chimo, there is a very good chance there is a significant gold resource.
The downside is that it all takes time and during a lot of that time there is very limited news. A situation which the market hates.
Here is where the importance of having more than one project becomes apparent. While the engineers were working on the Chimo PEA, Cartier was working on its Benoist project and the recently 100% acquired Fenton exploration project.
In a November 26, 2021 press release on Benoist, Cloutier commented, “The Benoist mineralized system, as demonstrated by the recent drilling, is present over a strike-length of 3 km, attains widths of 350 m and reaches a depth of 1 300 m and is still open. It includes the resources of the Pusticamica deposit. However, the 2021 drilling did not identify additional high-grade zones. We continue to receive results and will re-appraise the Benoist project potential at the completion of all drilling data.”
At Benoist, the company drilled 17,000 meters. “We had technical success,” said Cartier. “But so far, the grade is not there. We have shown that the mineralization and alteration system continues extensively under the deposit. So, we are pacing ourselves and rethinking our approach to future exploration for the project at large.”
Not the news retail investors wanted but very much the reality in an exploration program.
The Fenton project is very different. In a November 29, 2021 press release on Fenton, Cloutier states, “The recent compilation of all historical data of the Fenton project has made it possible to accelerate the field work that will lead to the drilling of the best gold targets.”
The Fenton property already has a small, 63,000-ounce historic gold resource estimate. While Cartier is not at the stage where it can update this historic resource, the resource and the data it is based upon can be used as a starting point for Cartier’s exploration.
“All our exploration programs are designed to determine if they can rapidly graduate to a resource estimate level,” said Cloutier. “We want to significantly expand the resource base and to do that we have to drill.”
“Currently, there are fifteen known targets and near-surface gold zones identified at Fenton,” said Cloutier. “The deposit itself outcrops at surface.”
As importantly, Cloutier points out, “We’ve seen high grade drill indicated sections within, broader intervals of lower grade material, rapid ounce-building stuff.”
“At Fenton, we are looking at 200 to 300 meter holes,” said Cloutier. “This is much easier drilling as compared to Chimo (where 800 to 1800 meter holes were needed). Short hole drilling, 40 holes, one machine running 24/7.”
Cartier hopes to start drilling in February with a program targeted at 16,000 meters. “At Fenton, you are looking at old school, high reward, low cost exploration work,” said Cloutier. “We only acquired the remaining 50% of the property from the Government of Quebec in April..”
Cartier is determined to learn from its mistakes of 2021. “We are lining up for more robust news flow for early 2022, from Fenton and Chimo Mine and perhaps other fronts,” said Cloutier.
So, while the slow, methodical work of a PEA is moving forward for Chimo, Fenton promises a steady news flow to keep retail investors engaged.
“New stuff, such as a 356 gram per ton drill indicated gold showing at Fenton on recently acquired claims is just one example of things we are evaluating right now,” said Cloutier as we were ending our call.