- Lode Gold leverages the “butterfly effect” by strategically securing and advancing overlooked but highly prospective gold assets across North America.
- With a new team of seasoned mining executives, operators and financiers, Lode Gold is capitalizing on opportunities in safe jurisdictions as the price of gold keeps soaring.
- Lode Gold has incorporated a new wholly owned subsidiary to vend in its Canadian assets in Yukon and New Brunswick. The intention is to spin off the subsidiary into a new public vehicle to unlock value for shareholders, to position key investors by creating an exploration pure play.
The “butterfly effect” is a concept used to denote how some of the smallest of decisions and actions can often lead to significant results.
In essence, that’s the story of Lode Gold Resources Inc. (TSXV:LOD | OTC:SBMIF), which is leveraging the “butterfly effect” principle by strategically acquiring and advancing overlooked but prospective gold assets in proven mineral-rich regions across North America.
Lode Gold, launched early 2024, has a butterfly logo — to signal a new start in a new year that includes plans to spin out its Canadian assets into a new company called Gold Orogen.
“We now have the right people, assets, place and time — four pillars that will ensure a successful mining company.”
— Wendy T. Chan, CEO & Director, Lode Gold
Key management changes to lead the company’s restructuring, growth strategy and plans include the appointment of Wendy T. Chan as CEO. Chan has over 20 years of experience in developing and executing strategic plans for Fortune 500 and entrepreneurial companies with global outreach.
The company has also appointed renowned veteran geologist Buddy Doyle as vice-president of exploration. Doyle has over 40 years of experience in several greenfield assets in identification and exploration, through to development and production. He has led discovery teams at Lihir (more than 50 million ounces of gold), Diavik (more than $20 billion in diamonds), Mara Rosa project in Brazil (sold for $180 million), and Lavras Gold in Brazil (with a current market cap of $150 million). He worked for Rio Tinto PLC for over 23 years and was exploration viceresident of Kennecott Canada Exploration Inc. (owned by Rio Tinto), in charge of diamond exploration in North America.
Adding strength to Lode Gold’s team is Carlos Saban, a skilled mining geologist who has been appointed to the company’s Technical Advisory Board. Saban has been involved in the identification, delineation, and modeling of several NI 43-101 compliant multi-million-ounce precious metal projects during his career.
Lode Gold has also announced a new strategic shareholder, The Tomlinson Group, which is the second of its two large shareholders. Along with Coast Capital Management, both shareholders have expressed confidence in the long-term value of the company’s assets. Lode Gold has a strong shareholder base with 59 per cent held by institutional support. Coast Capital has had turnaround success with the likes of Jaguar Mining and Rubicon which bodes well for Lode’s new launch.
”Having worked for decades in infrastructure and resource sectors — we see the opportunity in small cap mining where hundreds of millions of assets are locked in the ground, waiting for the right management to unlock it,” said CEO of The Tomlinson Group, Ron Tomlinson.
Chad Tappendorf, managing director of Coast Capital LLC, said he has full confidence in Lode Gold’s advanced asset in California and several choice exploration projects in key jurisdictions in Canada. “At Coast Capital, we pride ourselves as investors/financiers of undervalued turnaround situations where we can discover diamonds in the rough,” he said.T
he continued long-term commitments from The Tomlinson Group and Coast Capital have helped clean up the balance sheet and set Lode Gold up for a fresh start in 2024, in a market where gold has recently achieved historical highs.”We now have the right people, assets, place and time — four pillars that will ensure a successful mining company,” said Chan.
Lode Gold’s plans to separate its key assets
Lode Gold’s new strategic direction, and the key to unlocking its shareholder value, focuses on separating its major assets, positioning new investors and building a strong team.
”We have put together a strategically skilled and execution-focused team of professionals at the corporate and board level to rebuild the company,” said Chan.
The company’s flagship operation is the Fremont Gold Project in Mariposa (the Spanish word for butterfly), which boasts 3,351 acres of private land in the original California gold rush county. The project is on the prolific 190-kilometre Mother Lode Belt, where 50 million ounces of gold have been produced.The Fremont project property hosts an NI 43-101 compliant resource of 1.16 million ounces at 1.90 g/t Au within 19 million tonnes indicated and 2.02 million ounces at 2.22 g/t Au within 28.3 million tonnes inferred.
This mineral resource estimate (MRE 2023) evaluates only 1.4 kilometres of the four-kilometre strike length of the Fremont property that features four gold-mineralized zones, said the company, adding it plans to develop a geological model for a potential high-grade underground gold mine, targeting two million ounces at five grams/tonne (three grams/tonne cut off). Significantly, three step-out holes at depth hit mineralized structure, typical of orogenic deposits that often occur at depth.
A March 2023 independent Preliminary Economic Assessment (PEA) for the Fremont Gold Project envisages an 11-year mine life at 118,000 ounces per year.
The property has excellent infrastructure with year-round road access and is close to airports and rails and is only 1.5 hours from Fresno, Calif.
The company’s other projects include the Golden Culvert and Win projects in Yukon, covering 99.5 square kilometres across a 27-kilometre strike length, which are situated in a district-scale, high-grade-gold-mineralized trend within the southern portion of the Tombstone Gold Belt.
Gold deposits and occurrences within the Belt include Fort Knox, Pogo, Brewery Creek, and Dublin Gulch, as well as Snowline Gold’s Valley target on its Rogue property in the Selwyn basin.
Lode Gold’s McIntyre Brook project in New Brunswick, covering 111 square kilometres and a 17-kilometre strike length in the emerging Triple Fault gold belt, is surrounded by Puma Exploration’s Williams Brook project (5.55 grams per tonne gold over 50 metres) and is hosted by orogenic rocks of similar age and structure as New Found Gold’s Queensway project.
The company also holds the early-stage exploration Dingman Gold Project in Ontario.
In 2020, the market capitalization of Lode Gold with just the Yukon and New Brunswick assets alone was $30 million. In Q3 2023, it dropped to as low as $3 million.The company is on track with its execution of a three-step strategic plan:
- Closing a $2 million positioning round of financing to fund strategic efforts;
- Unlocking shareholder value by evaluating and spinning out its key Canadian assets into a separate vehicle; and
- Seeking a strategic partnership to pursue the high-grade underground potential at Fremont.
In May 2024, Lode Gold announced it had incorporated a new wholly owned subsidiary — Gold Orogen — to vend in its Canadian assets in Yukon and New Brunswick. The intention is to spin off the subsidiary into a new public vehicle.
Lode Gold has recruited Buddy Doyle, VP of exploration, to head up exploration at the new SpinCo called Gold Orogen. Read more about Lode Gold's subsidiary company on our website at https://t.co/1vBlmbfphv#gold #mining #invest @CapitalJemini #goldmining pic.twitter.com/SlsPLBoDNM
— Lode Gold (LOD:TSXV SBMIF:US) (@LodeGoldRes) May 17, 2024
“The strategy is to separate these assets from California and generate value for shareholders by allowing them to expand and to grow separately,” said Gary Nassif, Lode Gold’s senior vice-president.
”Separating them benefits the assets in terms of increasing their value and it’ll benefit the shareholders because they’ll end up getting basically a ‘two for one’ deal and investments in both companies. In 2020, the company’s market cap was $30 million with only our Yukon and New Brunswick assets — for the California asset, a sensitivity to the March 31, 2023 PEA at US$2,000/oz gold gives an after-tax NPV (five per cent) of US$370 million and a 31 per cent IRR.
Glittering allure of gold captures investor interest
Lode Gold’s strategic shift comes as the glittering allure of the yellow metal is once again capturing the attention of investors all around the world.Last week, the Union Bank of Switzerland (UBS) raised its forecast for gold prices, projecting the precious metal to reach $2,600 per ounce by the end of 2024, up from the previous target of $2,500 per ounce.
Ongoing geopolitical uncertainties, including the approaching U.S. election, conflicts in the Middle East and Ukraine, and heightened U.S.-China trade tensions, are expected to support gold as a hedge, the bank said.
Looking further ahead, UBS also introduced an end-June 2025 forecast of $2,700 per ounce.
”This new rise in gold prices is due to a convergence of factors, including still-high inflation and ongoing geopolitical tensions. As the economy is impacted by these and other uncertainties, the price is being pushed higher by increased demand from investors who are seeking refuge in the time-honored stability of gold,” reported CBS News recently.
The World Gold Council’s Gold Demand Trends report for the first quarter of 2024 revealed that total global gold demand was up three per cent year-over-year — the strongest first quarter since 2016.
”Looking ahead, 2024 is likely to produce a much stronger return for gold than we anticipated at the beginning of the year, based on its recent performance. Should the price level off in the coming months, some price-sensitive buyers may re-enter the market and investors will continue to look to gold for a safe haven asset as they seek clarity around rate cuts and election results,” said Louise Street, senior markets analyst at the World Gold Council.
Against this backdrop, Lode Gold is applying the “butterfly effect” principle with its new team of seasoned executives, operators and financiers with extensive experience in financing, developing and operating mining projects around the world.
By identifying and acting upon smaller opportunities in proven and safe gold-producing regions, Lode Gold aims to unlock significant future value through systematic exploration, development, and potential production, the company said.
It’s a reminder that in the high-stakes world of mining, paying attention to the minutiae can lead to striking it big especially when you are starting with a solid underpinning of one million indicated and two million inferred gold ounces.
”As gold hovers near historic highs, we are excited with the possibilities. Stay tuned for more updates as we move into 2024,” added Chan.
To learn more about Lode Gold Resources Inc., visit their website here. For the latest updates, follow Lode Gold on social media: Facebook, X, Instagram, and LinkedIn.
