Check out this video clip that NIA has obtained of a well-known gold/silver newsletter writer speaking to a major investor behind Coral Gold (TSXV: CLH). The investor confirms that Royal Gold (RGLD) has already expressed major interest in CLH and their extremely valuable royalty in the Robertson gold project of Barrick/Newmont's Nevada Gold Mines, which is directly adjacent to the Pipeline deposit of Barrick/Newmont's Cortez mine and all of its existing infrastructure and mills. Because of the existing infrastructure of Nevada Gold Mines, NIA considers it close to a 100% sure thing that they will bring Robertson into production!
If Barrick/Newmont didn't fully intend to bring Robertson into production, they wouldn't have guaranteed CLH an annual advanced royalty payment of USD$500,000 beginning on January 1, 2025 in the event that Robertson isn't producing by December 31, 2024. These guaranteed annual payments would continue until Robertson reaches production for up to 10 years, which means that in an absolute worst case scenario CLH will receive future cash payments totaling USD$5 million (CAD$6.6 million) or $0.14 per share on top of CLH's current cash position of $0.382 per share thereby giving CLH a total of $0.522 per share in cash! CLH closed yesterday at only $0.49 per share!
CLH is sitting tight burning very little cash while the world's two largest gold miners Barrick and Newmont invest heavily into an aggressive drilling campaign at Robertson using three drilling rigs. Nevada Gold Mines dedicated 2/3 of their entire 2019 Cortez exploration budget to Robertson with a goal of releasing a Pre-Feasibility study as soon as the end of 2019 or early 2020. This Pre-Feasibility study will at a minimum define an updated Robertson resource in the area where CLH discovered a large deposit of near-surface gold, but it is the belief of Barrick/Newmont that a large high-grade underground feeder zone also exists on the property!
Even without a high-grade underground feeder zone, Nevada Gold Mines has already confirmed that CLH's inferred resource of near-surface gold totaling 2.7 million oz was under-sampled and the actual grades are higher than CLH estimated. We could see Nevada Gold Mines announce an updated resource in its upcoming Pre-Feasibility study that far exceeds 2.7 million oz. However, in an attempt to be extremely conservative, if we estimate that Nevada Gold Mines recovers 2.7 million oz of future gold production from Robertson it will generate total royalties for CLH of USD$60.75 million (CAD$80.19 million) based on a gold price of USD$1,500.
With only 47.7 million shares outstanding, CAD$80.19 million would add $1.68 per share in value on top of CLH's current cash position of CAD$0.382 per share thereby giving the company a future valuation of $2.06 per share!
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