NEW YORK, NY / ACCESSWIRE / February 26, 2016 / Metanor Resources Inc. (TSX VENTURE: MTO) (OTC: MEAOF) (Frankfurt: M3R.F) Vice President, Treasurer, and Director, Ronald Perry, was interviewed by mining analyst Jay Taylor of Hard Money Advisors Inc. regarding an update on its commercial gold production operation at its 100%-owned Bachelor Gold Mill in Quebec and related exploration efforts. This interview falls on the heals of the same analyst releasing an advisory to his paid subscriber base on the merits of establishing a long position in MTO.V, recommending with a near-term US$0.15/share price target for MEAOF (~$0.20 Canadian on the TSX Venture Exchange for MTO.V; MTO.V is currently trading ~7 cents CDN). Mr. Taylor has a business MBA in Finance & Investment, in-depth accredited studies in geology, has decades of mining sector analysis under his belt, and is known for being reserved in his advice.
The 17 minute audio interview segment with Metanor’s V.P. may be listened to at
http://jaytaylormedia.com/media/MetanorResources20160223.mp3 online. The
interview was recorded as part of a weekly radio show that included several guests discussing topical economic and precious metal related matters, for those wishing to listen to the full 57 minute show may do so at
http://www.voiceamerica.com/Show/1501 (the Metanor interview begins at
approximately the 15 minute mark).
In the interview we noted following points of interest discussed:
Operationally:
It was noted that Metanor had been mining ~4 g/T material for the last few quarters at Bachelor, however this ~mid-March the Company is “looking forward to getting back to what the mine is all about; 7 g/T – 10 g/T gold on the Hewfran side”. Improved metrics from a combination of higher head grade and the spot price of gold now near $1,700/oz Canadian is expected to generate good positive cash flow. Also discussed was the success of Metanor in having generated sufficient cash flow to have completely repaid its loan from Investissement
Québec (originally $7 million CDN). Also the VP confirmed the Company has successfully completed its $20 million USD cash flow guarantee to Sandstorm and stated “We will be discussing a new agreement with them as things go forward.” This positions Metanor in a strategically advantageous position as the Company is no longer obligated to run Bachelor ore to meet a cash flow guarantee and can now effectively process ore sourced from anywhere it wishes from outside Bachelor without penalty from Sandstorm, as Sandstorm’s gold participation agreement is only on Bachelor-area sourced material. Operationally on a capex note, the VP pointed out that the Company can do a 50% capacity increase on the
Bachelor Mill for under $3 million Canadian.
Building Serious New Gold Ounces at the Moroy Property South Zone Adjacent
Bachelor Mill:
The VP confirmed ice bridges have been built over the tailings pond and the Company has embarked upon a 60,000-metre surface diamond-drilling campaign to build ounces in the new mineralized zone underlying the South Zone/Moroy property. Metanor plans to take advantage of the winter conditions to drill high intensity voluminous sized IP targets that are highly prospective for large gold values. Over the last few months Metanor has released a series of stellar drill results from this new South Zone/Moroy Property located south of the pluton only ~900 meters south of the headframe at Bachelor (e.g. 10.1 g/T Gold over 26.2 m, 6.7 g/t Au over 38.4 m, 18.9 g/t Au over 5.6 m, 15.3 g/t Au over 6.6 m).
This new South Zone system appears to be huge and to be of higher average grade and thicker structure than the Bachelor/Hewfran sections. This South Zone is expected to contribute towards adding numerous years of additional mine life and is a game-changer that takes Metanor’s future prospects to a whole new level, dramatically increasing the attractiveness of MTO.V for shareholders and for potential suitors looking to acquire/buy-out.
Additionally we note, Metanor has updated its corporate presentation in preparation for PDAC, on page 16 is an image that shows a conceptual development
of the South Zone, this image links to a 3D animation; see presentation at
http://www.metanor.ca/media_uploads_en/Metanor_Resources_Corporate_Presentation_February_2016.pdf
online. Near-surface, in the top 1,500 m of drilling alone to date, there appears already 10,000 ounces gold in high-grade material ripe for the taking (not yet defined as a resource though). Mr. Thibaut Lepouttre, Managing Director at Belgium-based mining and commodity research BVBA firm Caesar published a report in February 2016 in which he extrapolates results to date and sees potential* for 1,000,000+ new high-grade ounces from the South Zone (see link to
that report at bottom of this page).
Barry Deposit – Second Mining Front (Located ~65 km from Bachelor Mill):
In the interview the VP re-affirmed that the Company is studying the possibility of restarting gold mining operations at the Company’s open pit on its 100% owned Barry Property. Putting a second front into operation mitigates operational risk (not having to rely on a stand alone operation) and allows for better head grade control. Metanor originally mined ore from Barry when it first took the refurbished Bachelor Gold Mill online several years ago, while it was still prepping to access the high-grade underground ore at Bachelor mine, it poured a
total of ~45,000 oz gold from Barry sourced ore during that initial interim period. Barry ore is NOT subject to the Sandstorm gold participation agreement, Metanor is able to sell all gold produced from Barry at market price. The following points were noted that make mining Barry a more attractive proposition now, relative to when it was mined previously;
1) Gold is now near $1,700.oz CDN compared to $1,250 – $1,300/oz back then.
2) Transportation costs are cheaper now (was $22/T, now with lower fuel costs
and other efficiencies possibly ~$17/T or less is in order).
3) Recoveries at Bachelor Mill were in the 80’s percentage-wise when Barry ore
was processed, now recoveries are ~97%.
4) Metanor is going to have consultants look at high-grading the pit; the VP
stated “there are some section that there will be 3 g/T to 4 g/T.”
There exists tremendous upside exploration at Barry. The 100% owned Barry property is neighbor to Oban Mining’s Windfall Lake Deposit (formerly owned by Eagle Hill). The area gold system is shared amongst a handful of players (Oban, Beaufield, Bonterra, and Metanor) and is part of a new mining camp in the Barry-Urban township of Quebec. The resource estimate at Barry now sits at 309,500 oz Gold of Indicated Resources (7,701,000 t at 1.25 g/t Au) and 471,950 oz gold of Inferred Resources (10,411,000 t at 1.41 g/t Au) and is wide open for large resource growth expansion. The current 1km strike at Barry is potentially 13km, there are in excess of 150 anomalies outside the pit area. The Barry deposit is a potential multimillion ounce target; the independent international professional geological firm SGS Geostat has identified Metanor’s Barry deposit as comparable in potential to rival other multi-million ounce deposits such as Canadian Malartic gold deposit (formerly owned by Osisko, now owned by Yamana
and Agnico-Eagle) & Detour Gold’s Detour deposit.
Asset Value and Book Value:
In the interview it was noted that Metanor is trading below book value of ~$52 million CDN, plus the Company has a loss-carry-forward on the books of close to $50 million (the impact could generate $15 million to $17 million in tax credits for a future acquirer). Combine that with a 100%-owned operating gold mill, positive working capital, steady cash on hand, ~1.6 million ounces gold global resources in all categories (on all properties, two of which are permitted mines), the current value of Metanor relative to its current market cap is disproportionate. Jay Taylor described MTO.V as an asset play “This is if nothing else an asset play, you have a mill that can be very easily upgraded to 1,200 TPD using Bachelor material, which as you pointed out you can already do 1,100 TPD to 1,200 TPD from Barry [softer ore], you have a mill, you have all these properties you can explore and develop more gold resources, you have other people around you that might need a mill. Seems like you have an awful lot going for you.” The VP agreed stating “The value is there, it is an asset play, and the sum of the parts is greater than the whole.”
Jay Taylor concluded the interview by observing the share price/market cap is on sale relative to its inherent value and the timing is right “…look at the
relative value; it looks like, especially if we’ve got wind at our backs on a new gold bull market starting, I think people are going to make a lot of money with Metanor if conditions remain as they are.”
The following research links for additional DD on Metanor Resources Inc have
been identified:
– Metanor Resources’ corporate website:
http://www.metanor.ca
– SEDAR Filings for Metanor:
http://sedar.com/DisplayProfile.do?lang=EN&issuerType=03&issuerNo=00019972
– Recent Mining Journal review of Metanor:
http://miningmarketwatch.net/mto.htm
– Recent advisory from Mr. Lepouttre, mining and commodity
research BVBA firm Caesar:
http://sectornewswire.com/CaesarsReport-MTO-2016-02-04.pdf
– Recent recommendation by Jay Taylor of Hard Money Advisors:
http://sectornewswire.com/MTOJayTaylor-Feb-2016.pdf
This release may contain forward-looking statements regarding future events that involve risk and uncertainties. Estimates of potential* made by the mining analyst are non 43-101 and not from the Company. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual events or results. Articles, excerpts, commentary and reviews herein are for information purposes and are not solicitations to buy or sell any of the securities mentioned.
Contact information:
Simon Levinson, Managing Director
Market Equities Research Group
s.levinson@marketequitiesresearch.com
SOURCE: Metanor Resources Inc.
ReleaseID: 437228
