Golden Cariboo Resources Ltd. (GCC:CSE; GCCFF:OTC; A0RLEP:WKN; 3TZ:FSE) announced Friday that due to “overwhelming demand” its non-brokered private placement will close oversubscribed at 7 million units at CA$0.18 per unit.
The total proceeds will be CA$1.26 million, said the company, which is exploring its Quesnelle Gold Quartz Mine property in British Columbia’s historic Cariboo Camp.
The company plans to use the proceeds for continued exploration and working capital.
Golden Cariboo’s team, and their ability to effectively utilize this injection of capital, is one of the things John Newell of John Newell & Associates said makes the stock attractive.*
“This management expertise significantly de-risks the exploration process, as they have knowledge and experience to navigate the challenges of bringing a project from discovery to production,” Newell wrote on September 6. “Their involvement also signals the confidence in the project, with insiders holding approximately 20% of the company’s shares.”
Golden Cariboo’s team, and their ability to effectively utilize this injection of capital, is one of the things John Newell of John Newell & Associates said makes the stock attractive.
President and Chief Executive Officer Frank Callaghan said he began rediscovering the Cariboo Camp in the mid-1990s as Barkerville Gold Mines Ltd. That company advanced its gold discovery to production and was acquired by Osisko Gold Royalties Ltd. (OR:TSX; OR:NYSE) in 2015 for CA$330 million. Osisko Development is about to restart mining operations in the camp.
Callaghan acquired the Quesnelle Gold Quartz property in 2019 and aims to repeat previous successes, given the property’s geology is similar.
“The team that we have is second to none,” Callaghan told original “Shark Tank” investor Kevin Harrington in a recent interview. “They find gold, and they’re good at it.”
The private placement is subject to Canadian Securities Exchange approval and all securities are subject to a four-month hold period, the company said.
‘We’ve Only Scratched the Surface’
According to Newell, the company’s recent drilling results at Quesnelle position Golden Cariboo to capitalize on further exploration in one of British Columbia’s most prolific gold districts.
The company said it has seen “exciting broad vein zones” at the project’s Halo Zone.
“Now we’ve just got to see what the assays say,” Callaghan said. Drill hole QGQ24-16, drilled to a depth of 362.1 meters, had shown visible gold, the company previously reported. Both it and QGQ24-17 intersected “extensive quartz-carbonate veining and alteration.”
“We’ve only scratched the surface of this massive gold system,” Callaghan said at the time.
Besides Osisko, the company’s neighbors in the mining district include Spanish Mountain Gold Ltd. (SPA:TSX.V) (Spanish Mountain deposit), Omineca Mining and Metals Ltd. (OMM:TSX.V; OMMSF:OTCMKTS) (Wingdam mine), and Taseko Mines Ltd. (TKO:TSX; TGB:NYSE.MKT)) (Gibraltar mine).
In a recent research report, Couloir Capital Senior Mining Analyst Ron Wortel recommended Golden Cariboo as a Buy “for exposure to gold resource discovery in a Tier 1 jurisdiction as the market delivers record gold prices.”
He also highlighted the company’s strong technical team, saying Callaghan’s history in the Cariboo Camp shows his “entrepreneurial drive and commitment to restarting the Cariboo Gold Rush,” Wortel wrote. “Frank and his team are bringing this drive, experience, and commitment” to developing their new Halo Zone discovery.
Exploration upside is also noteworthy, wrote the analyst, given that Golden Cariboo owns three additional claim groups in the camp: Rainbow, RimRock and White Pine.
The Catalyst: Golden Bulls Still Running Strong
Gold’s bull market continued to advance this week, as spot gold hit an all-time high of US$2,758.37 on Wednesday and was on track for a third straight weekly gain, Reuters reported. It had eased to US$2,734.25 by Friday morning.
“In the last couple of weeks, we had many all-time highs for gold, and it’s reasonable to have a little bit of profit taking and just a slowdown in the momentum,” said Alex Ebkarian, chief operating officer at Allegiance Gold, according to Reuters’ Anjana Anil.
“Non-yielding gold has risen over 32% so far this year as a half-point basis cut by the Federal Reserve bolstered prices, along with safe-haven demand stemming from ongoing tensions in the Middle East,” Anil wrote.
And it could go further. “If things heat up further in the Middle East, we could see US$3,000 before the end of the year, but I’m sort of leaning more towards Q1,” Peter A. Grant, vice president and senior metals strategist at Zaner Metals, told Reuters on Tuesday.
This rise has “resulted in big returns for the investors who bought in earlier this year,” Angelica Leicht reported for CBS News on Monday. “For example, the investors who purchased gold in March when it hit US$2,160 per ounce have seen their gold values increase by nearly 27% in the time since. That’s a huge uptick in value in a matter of months, especially on an asset that’s known more for long-term growth.”
Ownership and Share Structure
According to Golden Cariboo, management and insiders own 30% of Golden Cariboo Resources. President and CEO Frank Callaghan owns 16.45% or 6.93 million shares; Elaine Callaghan has 0.97% or 0.41 million shares; Director Andrew Rees has 0.79% or 0.33 million shares; and Director Laurence Smoliak has 0.3% or 0.13 million shares.
Retail investors hold the remaining 81.48%. There are no institutional investors.
The company said it has 50.3 million shares outstanding, 24.83 million warrants, and 3.8 million options.
Its market cap is CA$9.7 million. Over the past 52 weeks, Golden Cariboo has traded between CA$0.08 and CA$0.36 per share.
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* Disclosure for the quote from the John Newell article published on September 6, 2024
As always it is important to note that investing in precious metals like silver carries risks, and market conditions can change violently with shock and awe tactics, that we have seen over the past 20 years. Before making any investment decisions, it’s advisable consult with a financial advisor if needed. Also the practice of conducting thorough research and to consider your investment goals and risk tolerance.