If you look out over the long expanse of mining exploration companies based out of Canada, I’d suggest the vast majority don’t know how to tell a good story.
They can toss you pictures of a drill core, wave their hands, and say ‘real investors know what they’re looking at’ (hat tip to White Gold WGO.V who basically told our young analyst to GFHS when asked to explain their differentiators at PDAC a few years back), and they can put up a map and a picture of a truck on an investor conference backdrop (hat tip to every gold explorer, like, ever), and they can dazzle you with engineering and geology chat that 95% of potential investors couldn’t make head nor tail of, but very few can create a ‘capsule review’ of what makes them special, or a brand that resonates, or an investor deck that lays out a real plan.
Some companies nail it, and they tend to amass investors quickly and hold them for some time by illustrating themselves, as Thanos would suggest, as being ‘inevitable.’
Here’s an example:
That’s a single page on the Great Bear Resources (GBR.V) deck. It’s a beauty. Everything you could ever need is on that page. You could make an investment off just that page.
And it did the work. GBR took a couple of years to build to an $800m market cap.
Of course GBR has good bones but they also had great success telling their story. That makes them, sadly, a little unique.
SKRR Resources (SKRR.V) needs some help telling its story because, for mine, it doesn’t differ much from where Great Bear began its run.
But here’s the thing: Telling a story well is the easiest part of building a mineral explorer. Finding ore is the hard part. Building a team is a rough one. Raising money can be a dire challenge.
But telling a story? Well, for that you just need clarity.
SO HERE’S YOUR CLARITY:
These graphic images show the Great Bear path to glory – beneath them, I’ll illustrate how SKRR is off to the same start.
According to the Fraser Institute, Saskatchewan is ranked #3 in the world for Mining Investment Attractiveness. Saskatchewan loves a mine, can’t get enough of them, would marry them in a heartbeat if they were asked.
And Saskatchewan has plentiful infrastructure – SKRR’s projects are hosted ‘in close proximity and in the same regional geology as the Santoy Mine and Seabee Mill, operated by SSR Mining Inc., both high grade/high margin gold mining operations.’ When an existing mine or two are pounding ore out, that means you’ve got power, roads, people, and transport nearby.
Great Bear has a lot more institutional money than SKRR, for certain, but they’ve been at it longer. SKRR has a lot of buy in from executives and insiders for a microcap, which sits at around 11% ownership at the time of writing. CEO Sherman Dahl has been buying into the market at regular intervals through the summer, which is a nice sign of confidence.
Again, GBR has the benefit of years over little SKRR, but the microcap has been busy gathering the dough it needs to kick on with developing their plays.
They were sitting on $2.35 million in cash over the summer with almost all their expenditures so far going into groundwork. When execs have charged the company for their time, the fees have been nominal. Everyone appears to be on the same team here. When more money is needed, the reputation of those at the helm brings what is required.
Great Bear has 57m shares out, which is tight. SKRR has 46m, which is tighter.
Again, GBR is more advanced, but the point is the things that made them rev are the things SKRR has started with.
Early in the year, drill results from the 12 hole winter drill program at the Olson property in Northern Saskatchewan included 50.24 metres of 0.41 g/t gold at the Point zone.
The drill program saw a total of 1,674 metres drill on the property, with six holes being focused at the Point zone, 4 holes at the Olson zone, and one hole at each of the Michael’s Lake and Ackbar zones. Nine of the twelve holes drilled reportedly intersected significant mineralization, with a new gold discovery being made at Ackbar where hole OL21029 intersected 0.75 g/t gold over 8.12 metres.
Highlighted results from the drill program include:
OL21019: 50.24 metres at 0.41 g/t gold at the Point zone
OL21020: 39.5 metres at 0.37 g/t gold at the Point zone
OL21025: 13.1 metres at 0.89 g/t gold at the Olson zone
OL21026: 29.44 metres at 1.30 g/t gold at the Olson zone
That’s a nice start to things. And that’s before we get to the Manson Bay gold zone, which our Greg Nolan thinks might be the cherry on top.
Preliminary drilling was conducted in 1985 by HudBay Minerals (3 holes) and was followed up in 1987-88 by Mingold Resources with a 44-hole, 4,607 meter program. Mingold estimated a historic resource of 660,000 tons grading 0.1 oz / ton (3.4 g/t) Au to a depth of 122 meters down-dip (66,000 ounces gold) with good potential for expansion of depth and strike extent. This historical estimate used a classification scheme other than those set out in National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101“). SKRR is not treating the historical estimate as a current mineral resource estimate.
Highlights from historic drilling include:
Hole MBO-15 intersected 15.39 g/t Au over 10.03 meters (85.98 to 96.01 meters) including
23.13 g/t Au over 6.40 meters (86.56 to 92.96 meters), including
219.02 g/t Au over 0.61 meters (87.29 to 87.90 meters)
I’ll admit, the SKRR branding looks like they sell tractor trailers. And the website is a little utilitarian. And the trading is light.
But here’s a thing SKRR has that Great Bear didn’t.
Right now, if you drop in on SKRR stock, you get a Hall of Famer, you get a handful of early stage properties with good guts, and you get all of that for $4.5m in market cap.
I’m not going to tell you what to do with your money but, dudes, this thing is a low downside high upside bet that should at least be on your watchlist.
Institutions love McElroy. Don’t wait for them to pick the bones clean.
— Chris Parry
FULL DISCLOSURE: SKRR Resources is an Equity.Guru marketing client
