- GOLDCORP IS SPENDING BILLIONS
- NEW MILL AT 50,000 TONNES PER DAY IN AS LITTLE AS 2-3 YEARS
- SOURCES REPORT GOLDCORP QUIETLY ACQUIRING CLAIMS IN THE REGION
Restaurants are busy, with lineups out the door. Hotels are fully booked, and rental properties are scarce. We would expect that in New York City or Hong Kong, but this is Timmins,a small city 435 miles north of Toronto, with an official population of 41,788.WHY is this small mining town buzzing with activity? Are these tourists? Scanning the restaurant patrons and hotel guests, I’m not seeing travel brochures, binoculars, or fishing rods.
After reading the latest couple of postings on Agoracom’s Explor Resources Discussion Forum, I was intrigued by some of the commentary offered by one of our regular contributors. Apparently, the influx of new faces is coming from a growing number of engineering firms & contractors, that are flooding into Timmins in response to the proposed construction of a huge, new mill by Goldcorp. That has incredible potential ramifications for junior resource companies in the area, most notably, in our opinion, for Explor Resources, (EXS-TSX.V; EXSFF-OTCQB; E1H1-FRFT/BE), one of our featured Junior Gold & Base Metals exploration companies.
GOLDCORP IS SPENDING BILLIONS
Sources tell us that Goldcorp has spent over $50 Million to date on a study to expand their existing Dome Open Pit and build a 50,000 tonne per day Gold mill. I’m also hearing they intend to spend some $2Billion to develop and produce their Gold assets in Timmins. That’s huge news.However, never willing to buy into thegrand,& often exaggerated stories from miners and drillers, we decided to do our own research and found significant corroborating evidence backing up the rumours.
Specifically, Goldcorp Porcupine Gold Mines Mine Manager, Marc Lauzier, made the following statement in December, 2016, in an article that exposed the possible re-opening of the Dome Open Pit mine in Timmins Porcupine:
“What we’ve basically done is stitched together all the (geologic) models from the underground and the surface and re-ran a new pit shell. What that determined, when we ran a new pit shell, was that we had the potential for a deeper open pit (Gold mine) than the initial open pit that was there”.
NEW MILL AT 50,000 TONNES PER DAY IN AS LITTLE AS 2-3 YEARS
Further, Goldcorp President, David Garofalo, made an even bolder statement during the company’s Q3 presentation when he stated:
“I view it as the cornerstone of (Timmins) Porcupine moving forward,” he explained. “We’re envisioning a new mill, much higher throughput, probably three or four times the throughput we have now at our existing mill, which is about 11 or 12 thousand tonnes a day.”
Another reliable source told us that “sterilization drilling” is currently taking place to ensure no economic Gold ore is under the proposed new structure. “It’s not cheap. A few million dollars easy”. A structure of this size would have an enormous foot print and you don’t want it sitting on top of the very Gold it’s supposed to process.
Moreover, one of our sources claims,“Goldcorp have all the permits in place, with the exception of the construction permit, which is the easiest one to get. As such, the new mill could be up and running within 2-3 years if they started today.”
What will happen to the old mill Garofalo mentioned above? Sources tell us the old mill IS sitting on top of a Gold ore body, “which means it has to go. If it has to go, it has to be replaced before it goes.” This statement was supported by an article that stated:
“With the opportunity to extend the Dome Open Pit (Gold mine), new infrastructure would be required as the current mill, processing plant and administration building sit on top of what is envisioned to be the extended open pit.”
Summing up, the rumours of a $2Billion, 50,000 ton a day mill development plan appear to have a basis in fact, bearing in mind the Garofalo & Lauzier comments, and all the new faces in Timmins.Goldcorp’s CEO Garofalo isn’t just “envisioning” a new mill, it appears to be underway.
SOURCES REPORT GOLDCORP QUIETLY ACQUIRING CLAIMS IN THE REGION
Its common knowledge that Goldcorp’s Regional Gold mining operations are insufficient to support a 50,000 ton a day mill. So where is the mill feed going to come from? “Therefore, we will have to acquire more projects.” Apparently,Goldcorp has been quietly picking up privately held Gold claims in the region. Further, our sources are telling us Goldcorp has been acquiring ground around the open pit, just to provide them with additional breathing room needed to accommodate the development.
WHICH SMALL CAP COMPANY STANDS TO BENEFIT THE MOST?
With all of this Goldcorp action taking place in Timmins, there are a number of small Gold exploration companies that could stand to benefit. Having researched a number of these, the one Ifeel will benefit the most is Explor Resources. (TSX VENTURE:EXS) (OTCQX:EXSFF) (FRANKFURT:E1H1) (BERLIN:E1H1)
Yes, they are a sponsor of AGORACOM, so assume we are horribly conflicted. Here are the facts for you to consider:
- Explor’s flagship project is the Timmins Porcupine West (TPW) Gold deposit,
- It is located less than 7miles SE of the new Goldcorp mill.
- The established strike length of Explor’s Gold deposit to date is 2,000meters (1.25miles), ‘open’ at both ends, and ‘open’ at depth.
- The ‘Discovery Hole’ 10-30 assayed9.22gr per tonne over 11.0 meters.
- The property hosts the largest ‘porphyry’ ever found in the Timmins Mining Camp, or the entire legendary Abitibi Greenstone Belt, home of The Dome, McIntyre, & Hollinger Mines, to name just a few.
- According to Chris Dupont, President & CEO of Explor, only about 30% of the porphyry has actually been explored, so it has the potential to be one of the largest Gold deposits ever found in Canada.
- Estimates suggest Explor’s TPW porphyry is easily 7-10 times larger than Goldcorp’s own Hollinger pit, which hosted and produced 19,327,691ounces of Gold by the time it shut down.In a recent article on MetalsNews.com Dr. Allen Alper, PhD Economic Geology and Petrology, Columbia University, NYC, a well-knownMining expert,stated“The Timmins Porcupine West (TPW) GOLD deposit model your team created, appears to suggest a potential of 25-30 Million ounces of GOLD in the ground”.
Given Goldcorp’s massive undertaking in Timmins, it stands to reason the TPW Gold Resource has become a very valuable target. Clearly,Goldcorp does not have enough ore to feed a 50,000 ton a day mill, and, logically, they will have to try to consolidate players or projects in the area, including Explor Resources to fulfill their needs.To this end, one of our sources stated,“You don’t build it for just 5 million ounces – but if you add everybody else’sexisting resource, you can easily get to 20 million ounces and more”.
US$250MILLION MORE REASONS
Explor has 250 Million more reasons to be attractive to Goldcorp.
The TPW Net Smelter Return Royalty (NSR) of 3%, originally negotiated in a deal with Dome Mines …. but now owned by Goldcorp! Under the Royalty Agreement, Explor Resources has the right to buy back 1% of the 3% for just $1million,leaving a lot of money on the table for Goldcorp. For example, if the TPW ended up containing 20 million ounces, the 1% royalty could actually be worth $US250million. (i.e. 20Million ounces x 1% = 200,000 @ US$1,250ounce).
Clearly, Goldcorp.has 250 Million reasons to take a serious look at Explor’ TPW.
With Goldcorp clearly on the move in Timmins and Explor Resources holding both a resource and an NSR of great potential value to Goldcorp, value that is far beyond the current market capitalization of Explor, you have all the reasons necessary to take a serious look at Explor Resources as well.
Canadian based funds holds significant positionsin Explor Resources and we are also told major European investment fundsalso holds meaningful positions.
Explor Resources Inc. TSX.V:EXS, OTCQB:EXSFF, FRANKFURT/BERLIN:E1H1
Skype Interview With Explor Resources President, Chris Dupont, March 13, 2017
AGORA Internet Relations Corp. holds shares of Explor Resources. We receive either monetary or securities compensation for our services. We stand to benefit from any share appreciation this write-up may generate. The information contained in such write-ups is not intended as individual investment advice and is not designed to meet your personal financial situation. Information contained in this report is obtained from sources we believe to be reliable, but its accuracy cannot be guaranteed. The opinions expressed in this report are those of AGORA Internet Relations and are subject to change without notice. The information in this report may become outdated and there is no obligation to update any such information. Do your own due diligence.