On July 20, 2021 X-Terra Resources (XTT.V) announced that it has completed the phase 1, 2021 drill exploration program on its 100% Troilus East property, located approximately 135 kilometres from the town of Chibougamau in the province of Québec.
Quebec is the Beverly Hills of Canadian gold exploration.
“It’s difficult to overstate the importance of a project’s zip code when shortlisting stocks in the junior exploration arena,” stated Equity Guru’s Greg Nolan on June 24, 2021.
Quebec is currently ranked #6 by the Fraser Mining Institute.
“It would appear that Quebec is not satisfied with the status quo and has recently announced a strategic initiative—an action agenda—it believes ‘will reinvigorate the mining industry and solidify Québec’s position among the leaders of responsible mining development.’” continued Nolan.
Incentivizing mineral exploration and development in the province is a shrewd move by the Quebec gov’t…
“One-fifth of Canada’s mining output comes from Québec and the resources exploited there are the most diverse in Canada: 15 metals and 13 minerals are produced and upgraded there including lithium, rare earths and apatite. In December 2020, Québec had 22 mines in operation and four mines in maintenance. Currently, some 29 development projects are under study.”
“Quebec’s partiality for all things mining is next-level. SOQUEM, a subsidiary of the Quebec government (Investissement Québec, to be specific) actually partners with junior exploration companies to help push projects along the development curve. A very recent example:
Here’s the thing: if you can find a company in a prospective geological setting within an under-explored region of a mining-friendly jurisdiction, like Quebec, your chances of tagging a significant new discovery rise considerably.” – End of Nolan.
“The program has exceeded X-Terra Resources’ expectations, as the principal southwest target has revealed an important alteration system developed about three kilometres east of the Troilus Mine infrastructure,” stated XTT on July 20, 2021.
Overall, the alteration system and mineralization observed, provides initial validation of the high priority anomaly at the Troilus East property.
The intermediate volcanics and intrusions can be considered as the main host rock for the polymetallic sulphides, presenting as stringers, laminations, disseminated clots in contact with centimetric quartz veins or fractures.
In addition, foliated and biotite-rich altered gabbro also hosts significant amount of disseminated pyrrhotite, reaching locally 10% in association with trace amounts of chalcopyrite.
A total of 10 holes totalling 1,560 metres was completed in this inaugural drill program.
Two holes that were also planned to the south-east have been postponed due to extreme terrain challenges. They will be revisited during the second phase of drilling planned for later this summer.
Year-to-date, gold prices have been choppy.
On June 2, 2021, gold was trading at $1,900/ounce.
It’s now fallen back to $1,810.
Despite this, the macro economic argument for gold has never been stronger.
“The COVID pandemic has added $24 trillion to the global debt mountain over the last year a new study has shown, leaving it at a record $281 trillion and the worldwide debt-to-GDP ratio at over 355%,” reported Reuters.
Most of that global debt is based on fiat currency (paper money), and many experts believe is very easy to manipulate supply.
No act of Congress can magically make a tonne of gold appear on the lawn of the White House.
“The U.S. dollar climbed to a three-month peak on Tuesday in a flight-to-safety bid, as investors remained anxious about a fast-spreading coronavirus variant that could throttle global growth,” reported Reuters on July 20, 2021.
“Commodity currencies tied to risk appetite such as the Australian, New Zealand and Canadian dollars struggled, with investors opting for safety or staying on the sidelines in the midst of renewed fears about the highly contagious Delta variant, now the dominant coronavirus strain worldwide,” continued Reuters.
The gains in the dollar come at a time when yield differentials have moved against it. Benchmark 10-year U.S. Treasury yields dipped to a five-month low below 1.20% on Monday.
“Many believe the very best of the recovery has already passed us and what is even worse, the medical concern that seemed to be fading away, seems to be returning with a vengeance,” stated Juan Perez, FX strategist and trader at Tempus Inc in Washington.
Exploration companies need money to fund drill programs.
On July 20, 2021 X-Terra announced that intends to raise up to $2.1 million, issuing 28 million units at a price of $0.075 per unit.
“Each unit will be comprised of one common share and one common share purchase warrant of X-Terra,” states XTT, “Each Warrant will entitle the holder thereof to acquire one additional common share of X-Terra at a price of $0.11 per share for a period of 24 months from the closing date of the private placement.”
“Troilus East is located along the underexplored Frotet-Evans Greenstone Belt in northern Québec,” stated Nolan, “And importantly, the project shares a common border with Troilus Gold’s (TLG.T) 8.11 million ounces AuEq resource—a resource that appears destined to grow (perhaps significantly so).”
The Frotet-Evans Greenstone Belt is still largely unexplored.
Kenorland Minerals (KLD.V) is developing three projects in Quebec where work is being completed under joint venture and earn-in agreement from third parties.
Three weeks ago, Kenorland announced final drill results from the 8,591 meter diamond drill program, at the Regnault gold discovery within the Frotet Project, located in northern Quebec, on the same belt XTT is exploring.
Kenorland highlights included 5.72 meters of 90.56 g/t Au.
X-Terra has begun planning the follow up exploration program, including additional geochemistry, with the expectation of extending the known mineralized corridor further to the northeast.
Full Disclosure: XTT is an Equity Guru marketing client.