Last Friday's session close saw gold tumble all the way down to a 1-month low of $1,680 (-2.5%). The largest monthly surge in US employment numbers ever recorded poured some cold water on fears of recession, leading many investors to cash out of their positions.
While the market expected May to log about 8 million lost jobs, the prediction was off by roughly 10 million. Over 2.5 million jobs were added over the past month after 20 million were lost over April during the peak of the coronavirus pandemic. The rise in employment is an unexpected and much faster-than-forecasted sign of recovery - something that would unequivocally hurt gold prices in the short term.
Despite all this, one can find Canadian projects making headlines that can position them as standouts to investors playing the long game. For examples, look no further than miners Great Bear Resources (TSX-V: GBR.V) and Gold Terra Resource Corp. (TSX-V: YGT; OTC: TRXXF).
Value picks with a twist
Mineral exploration company Great Bear Resources (TSX-V: GBR.V) operates out of Ontario, in its flagship Dixie Lake gold project. The 100%-owned position spans an impressive 9,140 hectares across 22km over the Red Lake district.
Vancouver-based Gold Terra Resource Corp. (TSX-V: YGT; OTC: TRXXF) is a junior gold exploration company with a massive district-scale position a short 12 kilometers away from the City of Yellowknife. Their Yellowknife City Gold Project (YCG) is located near the Con and Giant mines - which together have sourced over 14 million oz Au.
A major upside to YGT comes from its leadership, with Mr. Gerald Panneton at the helm as Executive Chairman. Panneton's accolades include co-founding Detour Gold - sold to Kirkland Lake earlier this year for an astounding $4.89 billion, and receiving the PDAC Discovery of the Year award in 2011. Several former Detour Gold collaborators join him on the board for this new endeavor.
Strength in numbers
Great Bear closed a notoriously beneficial first week of June with the completion of its previously announced bought deal private placement, raising gross proceeds of CA$33 million. The thick of the proceeds will be used for "Canadian exploration expenses" pertaining to its Ontario operations. With this, GBR has approximately $53 million in cash-at-hand, and strongly fortifies its funding for continuous exploration up to 2022.
Gold Terra recently revealed major news that could affect its impressive 735,000oz resource estimate. The latest drilling results indicate potential for the company to raise the roof on the November 2019 measurement. Assays for its latest set of 34 drill holes have extended the mineralized system at Sam Otto both along strike and at depth. The last 6 holes of their winter program included1.30 g/t Au over 50.6m, including 3.02 g/t Au over 9.0m-, and 1.18 g/t Au over 51.65m, including 2.07 g/t over 11.05m and 2.03 g/t over 13.5m.
Breaking new ground
Currently, Gold Terra isgearing up for its next drilling campaign, as they prepare to take on the Campbell Shear system.
President and CEO David Suda stated: "The second half of 2020 will be the most exciting time for Gold Terra as the Campbell Shear system emerges as the primary focus for the next drilling campaign for a potential new discovery for Gold Terra. We are identifying a number of high-grade drill targets on the Campbell Shear and are also planning the next drilling campaign at the high-grade Crestaurum gold deposit to expand the current resource (November 2019).”
Sporadic yet significant signs of economic recovery always harm gold prices in the short term. However, they can also be a sign of economic overstimulation and a potential rise in inflation. With interest rates back at zero and the Fed's ongoing printing campaign, investors could begin to see parallels between current times and the 2009-2011 era, which peaked with the precious metal's spike to roughly over $1,900. And both YGT and GBR are getting primed for that scenario.
About Goldterra
Gold Terra Resource Corp. (TSX-V: YGT; OTC: TRXXF) is a junior gold exploration company that has assembled a highly prospective district scale land position on the doorstep of the City of Yellowknife in the Northwest Territories. The company is currently focused on expanding and delineating gold resources at the company’s Yellowknife City Gold Project. With ready access to infrastructure and multiple new high-grade gold discoveries Gold Terra is on track to re-establishing Yellowknife as one of the premier gold mining districts in Canada.
Comparables
Great Bear Resources Ltd. (TSX: GBR.V) is a gold exploration company managed by a team with a track record of success in mineral exploration. Great Bear is focused in the Red Lake District in Northwestern Ontario, where the company controls over 300 km2 of highly prospective tenure across 4 projects: the flagship Dixie Project, and the Pakwash Property, the Dedee Property, and the Sobel Property, all of which are accessible year-round through existing roads.
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