Next Investors logo grey

Comet Resources inks deal to acquire Santa Teresa Gold Project

|

Published 25-AUG-2020 10:53 A.M.

|

3 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.


Click Here to View Latest Articles

Comet Resources Ltd (ASX:CRL) has executed a Share Purchase and Joint Venture Agreement (SPA) with the shareholders of El Alamo Resources Limited (EARL) for the acquisition of the Santa Teresa Gold Project.

The project is comprised of two mineral claims totalling 202 hectares located in the gold-rich El Alamo district, approximately 100 kilometres south-east of Ensenada, Baja California, Mexico.

The project is prospective for high-grade gold, with an existing non-JORC Inferred Mineral Resource of 64,000 ounces gold at an average grade of 8.7 g/t, reported at a cut-off grade of 4 g/t.

In addition to the two claims of the project, two additional claims totalling a further 378 hectares in the surrounding El Alamo district are being acquired from EARL.

Documentation of the binding gold streaming and royalty financing with Raptor Capital International to fund activities at the project for up to US$20 million (initial minimum of US$6 million) is advanced and is expected to complete in the near-term.

Comet targeting maiden resource

Discussing upcoming drilling and the company’s aim of establishing a maiden resource, Comet managing director Matthew O’Kane said, “From the initial announcement of this transaction to closing, the gold price has increased over US$200 per ounce.

‘’This has increased the potential value of Santa Teresa for Comet and we are now looking forward to commencing work on the historical drill core and a maiden JORC resource.

‘’In parallel, we will plan our initial field activities.

‘’The relatively under-explored nature of the project and the richness of the district provides substantial scope to extend mineralisation.”

Executives of Raptor Capital see this transaction as the forerunner to the project transitioning into a high-grade operating gold mine given the extensive experience that Comet’s board brings to the table.

The pending gold stream financing by Raptor that is subject to definitive documents being finalised is expected to fully fund the project through to production.

Reported gold production of up to 200,000 ounces in El Alamo district

Placer gold deposits of the El Alamo district were discovered in 1888, and high-grade ore-shoots were subsequently discovered on the Aurora-Princess vein within a year.

Lode mining continued until 1907, after which leases were worked until 1912 when mining ceased as a result of the Mexican Revolution.

The reported gold production of the broader El Alamo district as shown below has been estimated between 100,000 to 200,000 ounces of gold.

10 - crl.PNG

Initial site work at Santa Teresa will involve assessing near term production opportunities within the Santa Teresa licence area itself and the other licences proposed to be acquired in the El Alamo district, and if this work warrants, commencement of mining activities.

All such activities may be financed by the Raptor stream financing.

In addition, due to the recent increase in the gold price, work will also investigate options to increase the size and confidence of the resource prior to commencement of mine development activities.

Gold prices have continued to rise since the proposed Santa Teresa transaction initially announced, and some analysts are tipping further upside due to ongoing economic uncertainty related to the coronavirus, including the potential for central banks to ease monetary policy, a factor that has traditionally provided support for the gold price.



General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.