Cashed up from a recent property sale, Renforth Resources (CSE:RFR) is ready to go to work on its 100%-owned Parbec project, located within the gold-rich Cadillac Break that is part of the Abitibi Greenstone Belt, running through northern Quebec and Ontario.
Parbec borders Canadian Malartic – Canada’s largest gold mine – and is adjacent to the past-producing East Amphi mine.
On September 8 Renforth announced the start of a 7,000m drill program designed to “add ounces to the resource estimate at Parbec, through the under cutting, and drilling over of, existing results, as well as infill drilling and downdip extension drilling. Results in the field could result in additional holes being planned.”
The news follows the company’s move in early August to sell its New Alger property to Radisson Mining (TSX:RDS) for a combination of cash and shares.
Under the arrangement, Radisson will acquire a 100% interest in New Alger and enter into a long-term strategic relationship through a 9.6% equity investment by Radisson in Renforth.
Renforth is doing a concurrent financing to raise approximately $3.24 million, backed by Radisson’s 9.6% investment in Renforth. The financing is expected to be charity flow-through, whereby Renforth plans to issue 24 million flow-through shares at $0.135/sh, which would represent a 145% premium to Renforth’s most recent financing.
The company currently has about a million dollars in its treasury, with which to complete a substantial drill program aimed at adding to the just over 200,000 ounces (Indicated and Inferred) delineated at Parbec in an updated (May 2020) resource estimate.
Renforth Resources Inc. (CSE:RFR)
Among the most active gold juniors in Quebec, Renforth Resources is hoping to, a/ expand upon its existing resources, and b/ find new mineralization.
It currently has five gold projects including its flaship property, Parbec. Renforth is also exploring near the Canadian Malartic mine at its West Malartic project, at Denain-Pershing located in an active mining camp on strike to the Chimo mine and contiguous to the Croinor mine, and among a collection of claims it recently consolidated into a new project it is calling Surimeau. Additionally, the company owns the Nixon-Bartleman gold project located 45 km outside of Timmins, Ontario.
An important clarification: Renforth Resources is not looking for mineralization; it has already found it at New Alger and Parbec, which contain updated resource estimates. Renforth has been focused on increasing the resources at these brownfield projects, by proving mineralized structures and occurrences not fully defined, and open to expansion.
“Renforth is not engaged in searching for mineralization, we have several mineralized assets we can mature with field operations, continuing to define their extent and de-risk the deposits,” says Nicole Brewster, Renforth’s President and CEO.
A couple of other things about Renforth impress me, including the fact that CEO Brewster and her CFO, Kyle Appleby, are being paid in shares not a salary. The CEO is the main shareholder with over 8 million to her name (Renforth’s CFO almost as many), and has held the corner-office position for seven years – long enough in my view to know the project inside out, as well as having survived a few lean years in the sector.
And how about this: 90% of the capital raised goes straight into the ground. With a lot of juniors, a high percentage of funds gets spent on G&A – this is virtually unheard of, and to me, very impressive. It shows a company bent on exploration, and that they’re working to grow their assets and build shareholder value, without carrying out large capital raises that dilute the share structure.
“We know that every dollar we deploy is at a minimum going to add to the knowledge base, but realistically it’s going to lead to additional gold ounces,” Nicole Brewster told me over the phone this summer.
Much of the mining in Quebec has taken place along the Abitibi Greenstone Belt, one of the largest Archean greenstone belts on Earth. For the past century, over 100 mines operating along the belt have churned out nickel, copper, zinc, diamonds, and of course, gold.
650 kilometers long and 150 km wide, the Abitibi runs from west of Kirkland Lake, Ontario to Chibougamau, Quebec.
In the heart of the Abitibi Greenstone Belt, Quebec’s Cadillac Break is a regional fault zone thought to host a whopping 45 million gold ounces. The world-renowned structure stretches from west of Kirkland Lake in Ontario to east of Val d’Or, Quebec, which translates to “valley of gold”.
The Cadillac Break has been mined to various extents since the early 1900s, but it wasn’t until the 1990s that new mines were discovered along the gold trend, which revitalized mining and mineral exploration in the area. They include Agnico Eagle’s LaRonde mine, the old O’Brien mine now owned by Radisson Mining, and Canadian Malartic, a joint venture between Agnico Eagle and Yamana Gold that is currently Canada’s largest gold mine.
The brownfield Parbec project, on the Cadillac Break, borders the Canadian Malartic mine, and is adjacent to the past-producing East Amphi mine, where the joint venture has been drilling.
2019 drilling by Renforth proved that mineralization at Parbec is continuous for 1.8 km along the Cadillac Break, right up to the border with East Amphi – where resources were left underground following the cessation of mining in 2007.
Among the highlights are three areas of mineralization on the property: the discovery zone within the Cadillac Break, where the gold resource is largely above 200m, with the zone open to depth; the “Island Trench Zone”, sampled on surface and pierced to 738m, where 0.96 g/t gold was drilled over 0.5m; and the “Diorite Splay Zone” where gold is present on surface,within cross-cutting faults, and at contacts between sediments and diorite intrusives, in the Pontiac sediments – a unique setting similar to Canadian Malartic.
Parbec currently hosts an open-pit-constrained gold resource estimate of 104,500 indicated ounces gold at a grade of 1.78 grams per tonne and an inferred 177,300 ounces gold at a grade of 1.77 grams per tonne.
Drilling will consist of 26 holes totaling 7,261 meters, starting this week with the mobilization of one drill rig and technical staff to the property.
According to Renforth, employing only one rig, and pre-planning the holes, will maximize the program’s “bang for the buck,” by allowing the geological team to incorporate field and assay results as they are generated, which is hard to do with several rigs all generating core at the same time.
Remember, Renforth doesn’t have to go exploring for gold mineralization, they already have it at Parbec, Malartic West and Surimeau.
With the company cashed up from the New Alger sale, Renforth is turning its attention to Parbec, where an updated resource shows 104,500 indicated ounces gold at a grade of 1.78 grams per tonne and an inferred 177,300 ounces gold at a grade of 1.77 grams per tonne. The property is open-pittable and adjacent to existing mines.
The 26-hole drill program looks to be well-targeted. I like the fact they are only using one drill. While this means the program will take longer to complete, it will also allow them to keep on top of the results and hopefully get them out to shareholders in a timely fashion – avoiding long delays at the assay lab which can be very frustrating.
Quebec is one of the best jurisdictions to explore for gold. Not only do the Canadian province’s rocks contain just about every mineral known to modern society. Quebec is also steeped in mining culture, with an experienced, bilingual workforce, a rich ecosystem of mine suppliers, and high-quality mining infrastructure including paved access roads, low-cost hydroelectric power, and mineral processing facilities.
In 2018 the Fraser Institute ranked la belle province fourth in the world for mining investment, largely due to the Quebec government’s open-ness to mining companies, the relative ease of obtaining permits, and a tax regime friendly to mineral explorers.
Combine all of the above with a tight share structure, a management philosophy that values conserving cash (90% of capital raised goes into the ground; the CEO and CFO are paid in shares) and the fact that Renforth doesn’t even have to hunt for mineralization, they already have it, and you have the makings of a very interesting gold play worth following.
Shares Outstanding 213,836,539m
Market cap Cdn$13.8
Richard (Rick) Mills
Legal Notice / Disclaimer
Ahead of the Herd newsletter, aheadoftheherd.com, hereafter known as AOTH.
Please read the entire Disclaimer carefully before you use this website or read the newsletter. If you do not agree to all the AOTH/Richard Mills Disclaimer, do not access/read this website/newsletter/article, or any of its pages. By reading/using this AOTH/Richard Mills website/newsletter/article, and whether or not you actually read this Disclaimer, you are deemed to have accepted it.
Any AOTH/Richard Mills document is not, and should not be, construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment.
AOTH/Richard Mills has based this document on information obtained from sources he believes to be reliable but which has not been independently verified. AOTH/Richard Mills makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of AOTH/Richard Mills only and are subject to change without notice. AOTH/Richard Mills assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, AOTH/Richard Mills assumes no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information provided within this AOTH/Richard Mills Report.
AOTH/Richard Mills is not a registered broker/financial advisor and does not hold any licenses. These are solely personal thoughts and opinions about finance and/or investments – no information posted on this site is to be considered investment advice or a recommendation to do anything involving finance or money aside from performing your own due diligence and consulting with your personal registered broker/financial advisor. You agree that by reading AOTH/Richard Mills articles, you are acting at your OWN RISK. In no event should AOTH/Richard Mills liable for any direct or indirect trading losses caused by any information contained in AOTH/Richard Mills articles. Information in AOTH/Richard Mills articles is not an offer to sell or a solicitation of an offer to buy any security. AOTH/Richard Mills is not suggesting the transacting of any financial instruments but does suggest consulting your own registered broker/financial advisor with regards to any such transactions
Richard does not own shares of Renforth Resources (CSE:RFR). RFR is a paid advertiser on Richard’s site aheadoftheherd.com