by Konstantin Ogurchenkov
The Independent Speculator’s summer due diligence season is underway. I kicked it off in Late May, driving 1,500 miles to visit a copper-gold project in Western Canada (the full report is available to My Take subscribers) and the Metals Investor Forum in Vancouver.
The latter event is relatively small compared to major mining conferences like PDAC or the BC Roundup, but it features a couple dozen companies. It’s a good place to meet with management and look at their rock samples.
It’s good to be able to ask CEOs the most pressing questions in person. Sometimes we find new emerging companies or get updates from well-known names. Building your network in the industry is always helpful, of course, and it doesn’t hurt to get to enjoy beautiful Vancouver weather (as opposed to suffering ice-cold arctic blasts at PDAC in Toronto).
Such conferences are helpful, but the site visits are essential for our business. We pride ourselves on being a fully independent, unbiased newsletter. There is no amount a company can pay to influence our coverage. We need to get the facts and make our own call—which means we have to work twice as hard on behalf of our subscribers. It’s no easy task, but we’re ready to go the extra mile to get the job done.
Not all companies bring a lot of rocks to the conferences, but those that do deserve credit. Below is one of the best natural occurrences of molybdenum (moly) I’ve ever seen.
It was found on surface. It’s clearly “nuggety” (which can be a problem at some deposits), but it sure does suggest that there’s a rich deposit nearby.
In early 2023, the moly prices doubled in just a month. They quickly reversed and are now almost back to the trading range of the past few years. We assessed the situation during the spike and didn’t see any reason to believe prices would stay high for long enough to matter, so we stayed on the sidelines. I’m sure glad of that now.
This doesn’t mean prices can’t or won’t go higher from here. But companies working moly projects need to use conservative price assumptions in their models. Otherwise, they’re sure to get a thumbs-down from us.
Surprisingly, there was only one uranium company at the conference, and it was private. As a contrarian, I found this intriguing. The creation of a new exploration entity is hardly news in the mining world, but it’s interesting to see new uranium companies entering the market. I see it as more clear evidence of the sector’s resurgence.
There are said to have been over 500 uranium companies in the last uranium boom. Today, the number is much lower. The handful of companies that made it through the nuclear winter tend to have assets with measurable value or excellent potential.
Heads up: when uranium becomes the flavor of the day, a lot of junior exploration companies will rush in to the space. Some may be legit and do well, but most will be money pits. A few will be pure scams. It’ll pay to be very selective in choosing our uranium stocks, come the day.
Anyway, I would encourage everyone interested in the mining sector to attend some of these events to conduct your own due diligence on resource stocks you’re considering investing—or speculating—in.
If you don’t have time, you can always check to see if the company is covered in My Take (over 600 minerals and mining stocks so far). If you aren’t subscribed, please do: subscribers can request coverage for additional companies.
Meanwhile, as we go to press on this, I’m back out in the field—this time in Nevada—kicking rocks with Lobo. We’ve got a bunch of exploration and mining projects to review on behalf of our clients.
Due diligence is never optional.
KO
