Golden Tag (TSXV:GOG) Making Headway in a Down Market

The Globe and Mail published an article today talking about analysts reducing their forecasts for the TSX Venture Exchange (TSXV) due to the downside risks posed by the pandemic, the inflation, and the tapering of stimulus, this could also present an opportunity for savvy investors who are looking for bargains in the junior mining sector. As the market sees fear in the TSXV market, it may be time to be greedy and take advantage of the lower valuations and higher growth potential of some of the undervalued and underappreciated exploration companies.

The TSXV, which lists many emerging and innovative companies in the mining, energy, and technology sectors, could benefit from the favourable macroeconomic trends that are driving the demand for metals, renewables, and digital solutions. The TSXV could also offer a hedge against inflation and currency devaluation, as well as a diversification benefit for investors who are seeking exposure to different markets and regions.

Investors should keep an eye on Golden Tag Resources (TSXV:GOG)

Golden Tag Resources (TSXV: GOG) is one of the exploration companies that could offer a compelling opportunity for investors who are looking for value and growth in the junior mining sector. As the market sees fear in the TSXV market, it may be time to be greedy and take advantage of the lower valuations and higher growth potential of some of the undervalued and underappreciated exploration companies. GOG has made significant strides in expanding their resource but the market has yet to recognize this.

GOG announced on August 14, 2023 that it has closed its acquisition of the La Parrilla silver mine complex and exchange of subscription receipts into common shares and warrants. Some highlights of the acquisition include:

• La Parrilla is a fully permitted former producing mine complex consisting of five underground high-grade silver mines, and an open pit
• Demonstrated history of replacing resources – operated continuously from 2004 until September 2019 when it was placed on care and maintenance due to low silver, zinc and lead prices
• Under First Majestic ownership the mill produced 34.3 million (“M”) ounces1 (“oz”) of silver equivalent (“Ag.Eq”), with average annual production of approximately 2.96 Moz of Ag.Eq1, 2
• Excellent infrastructure inclusive of a 2,000 tonne per day (“tpd”) processing facility (1,000 tpd flotation and 1,000 tpd cyanidation circuits), dry stack filter plant with approximately 9 years3 of tailings capacity available, numerous buildings including a doré refinery, and a partial underground mining fleet4
• Indicated Mineral Resources are estimated at 5.19 Moz Ag.Eq and Inferred Mineral Resources are estimated at 10.33 Moz Ag.Eq5
• Located only 45 minutes from Durango City, paved highway to site
• Large, underexplored land package totaling 69,478 hectares
• First Majestic has become the largest shareholder of Golden Tag, now owning approximately 40.8%

As consideration for the Transaction, the Company issued 143,673,684 common shares of Golden Tag (the “Consideration Shares”) to First Majestic. Additional deferred payments of up to US$13.5M are comprised of the following:

• US$2.7M on the earlier of 18 months post-closing, or upon receipt of certain approvals from the Mexican government;
• US$5.75M when either (a) 5 million ounces of Ag.Eq reserves are declared from the La Parrilla claims, or (b) 22 million ounces of Ag.Eq of measured and indicated resources are declared, from the La Parrilla claims; and
• US$5.05M when a new zone is discovered on the La Parrilla claims inclusive of a NI 43-101 resource of 12.5 million ounces of Ag.Eq;

Given today’s market condition, GOG may be an undervalued and underappreciated exploration company that could offer a rare opportunity for investors who are looking for exposure to silver and other metals in a favourable jurisdiction. GOG has a large and high-grade silver resource that could grow significantly with further exploration and drilling. GOG also has a clear path to advance its project towards production and unlock its value for shareholders.

Disclaimer: NAI is being compensated for this content. Materials contained in this content are for information purposes only and is not intended to constitute an offering of securities in any jurisdiction. Nothing on this content should be construed as an offer, solicitation or recommendation to buy or sell products or securities.

In-Depth Analysis Industrial Metals Mining Silver