Earlier this month, we put it out that we liked gold on the pullback from $1,300 per ounce last month to about $1,220 per ounce. Since, spot gold has trekked back upwards to close Monday at $1,261, moving back over its 50 and 200 day moving averages for the first time in over three weeks.
With that, there’s reason to remain bullish long-term on gold, especially considering it keeps holding an uptrend even amid extremely low market volatility. When the day comes that volatility picks back up – and there’s no doubt it will at some point – gold will be particularly fashionable to own as a safe haven asset. Add in the infrastructure initiatives of U.S. President Donald Trump and there is, in fact, reason to be bullish on precious and base metals across the board, particularly gold, silver, copper, zinc and lead.
Given the tailwinds in blue chips, investors have shied away from developmental miners to a certain extent over the past three months, but after hitting a low of 5 cents in January, it looks like Silver Spruce Resources, Inc. (TSX-Venture:SSE) may have found a bottom. Shares bounced off the 52-week low to as high as 12 cents in March, returning this time to make a higher low at 6 cents.
The Nova Scotia-based explorer is developing promising properties in Arizona and Mexico. The Kay Mine project about a hour north of Phoenix is a 472-acre advanced volcanogenic massive sulfide (VMS) property. VMS projects are regarded with great potential due to the fact that these deposits are metal sulfide ores formed on ancient seafloors, characterized by prolific copper and zinc mineralization.
VMS deposits can go deep, real deep. For example, the Kidd Mine in Timmins, Ontario of Glencore (a VMS deposit) is the deepest base metal mine in the world at a depth of 10,300 feet below surface, while remaining open on downdip and potentially along strike.
With intermittent production from 1916-1956 and Exxon Mobile subsidiary Exxon Minerals spending over $1.5 million on exploration, mineralization in two lenses of massive sulfide extend at least to 2,100 feet in depth. Historic reports suggest indicated resources of 6.4 million tons of copper at a 2% cutoff, 3.03% zinc and 12.8% zinc equivalent at Kay.
Last week, Silver Spruce added Greg Davison, MSc, PGeo to its Board of Directors. With a career spanning four decades in the business, Davison is regarded as an expert in base metals and VMS deposits, with many mining successes in his curriculum vitae. His guidance will be important in the company’s drive to complete exploration at Kay necessary to complete a NI 43-101 on Kay’s resources.
The Company's Pino De Plata project is a precious and base metals project in the metal-rich state of Chihuahua, Mexico. The property exhibits a series of artisanal adits and is almost entirely surrounded by Coeur Mining. Exploration by Silver Spruce has confirmed three types of highly prospective mineralization and three separate target areas for a drill program. Historical data and Silver Spruce's initial NI 43-101 report on Pino de Plata indicate many similarities geologically between the area projects and surface sampling has confirmed areas of high grade mineralization boasting over 550 g/t silver with highly anomalous grades of lead, zinc and gold associated.
It is also interesting to note that Coeur Mining purchased Paramount Gold & Silver for its much larger concessions in the area in 2015 for about $171 million USD.
Despite the properties, namely advancing the VMS project in Arizona, at 6.5 Canadian cents, Silver Spruce is commanding a market capitalization of only C$2.98 million. Apparently, the market is waiting for some more data to increase the value of SSE, which the company hopes to deliver across the year. With that in mind, it’s hard to disagree with Dr. Brian Penney, Chairman of Silver Spruce’s Board, who said last month that the plan “is to verify Exxon's historical results as quickly and efficiently as possible, thereby raising the value of the company for all stakeholders.”
