May 2019

SolGold Plc. (TSX:SOLG; LON:SOLG) – More Regional Success

Impact: Mildly Positive SolGold has provided good exploration results from its Rio Amarillo project alongside an update regarding the potential referendum for the area overlying its Cascabel project area. SolGold recently updated its PEA, which highlights strong economics for Alpala and moves the project one step closer to production. We continue to believe that SolGold’s growing portfolio of exploration targets and its attractive and more advanced Alpala deposit make it a likely takeout candidate for majors.

Atico Mining Corp. (TSXV:ATY) – Successfully Resumes Operations at El Roble

Impact: Mildly Positive Atico has announced positive Q1/19 financial results, which was highlighted by a strong balance sheet despite the mine shut down. Our recent RCKS Webinar shed light on a number of positive developments including the successful resumption of operations. Our fundamental view is unchanged, we believe Atico is a low-cost producer with the ability to generate significant FCF with exploration upside that should generate significant FCF, which trades at a discount to peers.

RCKS Nugget: Vanstar Resources Inc (TSXV:VSR)

Drill results from Vanstar’s Nelligan gold project in Quebec’s Chibougamau camp has had sufficient grade and width to warrant our attention. We believe Nelligan is shaping up as a significant gold discovery, which should benefit this C$11.7M market cap company. Vanstar Mining Resources Inc (TSXV:VSR) is focused on the dvancement of the Nelligan project in partnership with operator and JV partner IAMGOLD Corp (TSX:IMG).

Novo Resources Corp (TSXV:NVO) – Mineralization Report Moves Karratha Ahead

Impact: Mildly Positive Novo has announced the completion of a mineralization report which is a key catalyst to move the Karratha Gold project towards pseudo production through a large-scale (~100k tonne) bulk sample. In 2019 Novo is focused on advancing multiple projects, all of which we expect to provide positive catalysts for Novo and the other Pilbara players.

Mawson Resources Ltd. (TSX:MAW) – High Grade Core Expected to Add Ounces

Impact: Positive Mawson has released more positive dill results from its winter drill program at the Raja prospect which continue to suggest the resource is poised to double with the next update. Additionally, the company has identified a high-grade core at Raja that we believe has already contains a ~100koz. We continue to believe that Mawson’s multiple deposits at its Rajapalot Project in Finland could eventually deliver a multimillion ounce resource, with the current resource likely to double after the most recent drill program.

Emgold Mining Corp. (TSXV:EMR) – Staking a Claim in the Walker Lane

Impact: Positive Emgold announced a LOI to acquire the New York Canyon property in Nevada, marking the last and perhaps most consequential in a string of recent asset acquisitions in Nevada’s Walker Lane district. We are watching Emgold closely as an up and coming Nevada explorer poised to unleash the potential from its asset portfolio in the Walker Lane district that may have potential synergies should exploration efforts prove successful.

Standard Lithium Ltd. (TSXV:SLL) – “Non-Standard” Partnership Makes it Work

Impact: Positive We had the opportunity to visit Lanxess’ (ETR:LXS) South Arkansas Brine operations, which is the planned location for Standard Lithium’s in-construction pilot plant (we visited the modular plant construction a few weeks ago - note here). We were impressed by both Lanxess’ operations, which Standard Lithium should benefit significantly from, and Lanxess’ commitment to lithium. We believe that Lanxess’ involvement could be a primary driver of value creation for Standard Lithium’s shareholders. Standard Lithium’s unconventional approach has created significant value for investors, which is not reflected in the company’s share price.

Fiore Gold Ltd. (TSXV:F) – Record Quarter Translates to Better Cash Flow

Impact: Positive Fiore Gold has released positive FQ2/19 financial results on the heels of record quarterly production. We believe that the company’s strong cash position (US$8.3M) and improving operations should provide the fuel for future production growth. Fiore is an undervalued gold producer whose solid operations and growth potential has not yet been priced in by the market.

Mako Mining Corp (TSXV:MKO) – Adding Ounces at Las Conchitas

Impact: Mildly Positive Mako released additional positive drill results from the Las Conchitas target which support our view that the company is positioned to substantially grow its mineable resources at San Albino. We continue to believe that Mako could be worth 3-4x where it is currently trading once there is clarity on project funding and updated economic study is released.

SolGold Plc (TSX:SOLG; LON SOLG) – Robust Economics Delivered for Alpala

Impact: Mildly Positive The Alpala PEA has returned positive initial economics moving the project another step closer to production. Overall, the PEA had lower opex and higher capex than our prior estimates resulting in a slight increase to our NAVPS estimate. This de-risking step offers improving evidence that Alpala is a world class project and moves it a step closer to what we believe is an inevitable takeout.