Is BOGO Real or Promotional?
Some people are asking if Borealis Mining (TSXV: BOGO) is a real gold company similar to when a person like Frank Giustra creates Aris Mining (TSX: ARIS) which is currently trading for $13.92 per share for a gain of 209.33% since NIA’s suggestion at $4.50 per share or is it closer to when a person like Frank Giustra creates a promotional play like Argenta Silver (TSXV: AGAG) which similar to Blackrock Silver (TSXV: BRC) is worth zero in real life despite trading at a high market cap.
BOGO is definitely real, but they are very smart about utilizing marketing in an effective way with good ROI.
Augusta Gold’s feasibility study for Reward released in September 2024 showed an initial CAPEX of US$89.7 million.
When Atna Resources did a feasibility study for Reward in July 2012 the initial CAPEX was US$34.5 million.
It costs at least 2.6x more to build a new gold mine in Nevada today compared to July 2012. In the event of a financial crisis where gold briefly crashed the absolute lowest it could possibly go would be $2,730 per oz or 2.6x more than the December 2015 low of $1,050 per oz. If gold were to crash by 29.27% to $2,730 per oz, the S&P 500 and NASDAQ would simultaneously decline by 60%-80%, and the money printing to fix the crisis would cause gold to rally the strongest from its bottom.
Gold is going to strongly outperform the S&P 500 and NASDAQ for the foreseeable future under all scenarios.
If gold reaches 2.6x above the September 2011 high of $1,920 per oz it would be approximately $4,992 per oz.
So, if you take Augusta Gold’s Reward initial CAPEX of US$89.7 million which in CAD would equal CAD$125.25 million and we estimate that BOGO’s Borealis mine would cost a similar amount to build its existing infrastructure today… BOGO at a market cap of CAD$146.4 million has almost no downside risk. It is barely trading for above what today’s cost would be to build their existing infrastructure.
When BOGO’s CEO holds up these gold/silver dore bars that were just poured in recent days, we understand why it may seem promotional because the 956.7 troy ounces poured (if 50/50 gold and silver and a small portion waste metal) may only have a total metal value of slightly more than CAD$2 million, but more gold pours are coming and full scale mining hasn’t even started yet (this is only from stockpile processing)!
Past performance is not an indicator of future returns. NIA is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. NIA previously received compensation from BOGO of US$100,000 cash for a twelve-month marketing contract which has expired but NIA could receive additional compensation for additional contracts in the future. NIA previously received compensation from ARIS of US$50,000 cash for a six-month marketing contract which has expired but NIA could receive additional compensation for additional contracts in the future. This message is meant for informational and educational purposes only and does not provide investment advice.
