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Argo Gold Inc (CNSX:ARQ) High-Grade Wilco Gold Project

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Midas Letter is provided as a source of information only, and is in no way to be construed as investment advice. James West, the author and publisher of the Midas Letter, is not authorized to provide investor advice, and provides this information only to readers who are interested in knowing what he is investing in and how he reaches such decisions.

Investing in emerging public companies involves a high degree of risk and investors in such companies could lose all their money. Always consult a duly accredited investment professional in your jurisdiction prior to making any investment decision.

Midas Letter occasionally accepts fees for advertising and sponsorship from public companies featured on this site. James West and/or Midas Letter may also receive compensation from companies affiliated with companies featured on this site. James West and/or Midas Letter also invests in companies on this site and so readers should view all information on this site as biased.

Argo Gold Inc (CNSX:ARQ) (FRA:P3U) (OTCMKTS:ARBTF) is focused on acquiring high-grade, long-term producing gold projects in Northwestern Ontario. President and CEO Judy Baker provides an update on Argo Gold’s flagship asset, the Wilco Gold Project, which the company acquired the rights to in 2016. The 14 square kilometre project site has the same geology and is just 75 kilometres away from Great Bear Resource Ltd’s (CVE:GBR) recent Dixie Project discovery, which has sent that company’s stock soaring. Argo Gold has a 2500 metre drill exploration plan for Wilco beginning in February and is currently raising $1 million in flow-through shares.

Transcript:

James West:   Hey, welcome back. My guest this segment is Judy Baker. She’s the President and CEO of Argo Gold Inc., trading on the CSE under the symbol ARQ. Judy, welcome.

Judy Baker:   Thank you very much.

James West:   Judy, tell me about Argo Gold: what are your main projects, where are you located?

Judy Baker:   Okay. Argo Gold was founded in the first quarter of 2016; it was the business plan of Delio Tortosa, Bill Kerr and myself; we’re focused on acquiring high-grade gold projects in northwestern Ontario.

Why? Bill Kerr has actually quite a bit of experience in the greenstone belt in northwestern Ontario; he’s got 40 years of exploration under his belt, and it was Bill’s view that northwestern Ontario had a lot of high grade, long-term-producing gold mines, but a significant lack of exploration, particularly in the last ten years.

As you see, a lot of exploration in Timmins, Val D’Or, Kirkland Lake, and other parts of east and central Canada, but not a lot going on in northwestern Ontario; but a lot of good, long-term producing assets.

James West:   Why is that? Why is there less…

Judy Baker:   I think it’s a little more remote, a little more far – like Red Lake is 450 kilometres, you know, northwest of Thunder Bay, right? So just a little farther afield, and not as much access.

So we started – Delio Tortosa, again, 40 years experience, was the key gentleman in terms of identifying and short-listing projects. The team agreed that we had a list of projects that we were targeting; what was available initially was McVicar Lake, so we staked that project right out of the gates, and that’s 30 kilometres northwest of the past producing Golden Patricia mine, which was 600,000 ounces, produced 14 gram per tonne gold in the 90s.

So that was the first project, but the flagship asset of the company is the Woco Gold project, and we acquired the initial part of Woco in November of 2016.

James West:   And so how much of it do you control right now?

Judy Baker:   All of Argo Gold’s projects are 100 percent owned by Argo Gold and its shareholders.

James West:   Oh, very cool.

Judy Baker:   Yeah, so it’s –

James West:   And, with NSRs?

Judy Baker:   There are some, yes. It’s hard to do deals on gold projects without NSRs, but generally they’re in the 2 percent range.

James West:   Gotta leave some upside for the prospector, eh?

Judy Baker:   One percent bought back, yes.

James West:   Sure.

Judy Baker:   So that was kind of how the company was put together. In the spring of 2017, gold markets were still good; Argo Gold was able to raise about $800,000. We carried out exploration on all eight 100 percent owned projects in the summer of 2017. From the field work we did, Argo Gold determined core assets versus non-core, and Argo Gold’s flagship asset, Woco, was determined core, and by early August 2017 we had doubled our ground out there with another acquisition, acquired more ground in February of 2018, and when online staking came, we doubled Argo Gold’s ground position out there again. So now we have 14 square kilometres at Woco.

James West:   Now the thing you told me about this project that really got my attention was that you were 75 kilometres away from Great Bear Resources’ recent discovery, that has sent that company’s stock into the stratosphere, and that you had the same geology and the same volcanics.

Judy Baker:   Yes. Okay. So what’s interesting, when Chris Taylor of Great Bear gets up to talk about Dixie, he starts off in some of the presentations, we’re in the long rocks. And the long rocks being the confederation volcanics; they’re 2.75 billion years old, and they’re the younger volcanics overlying the 2.9 billion year old bama volcanics, which host the Red Lake mines. And all the greenstone belts up there are known for their depth potential.

So both Argo Gold’s Woco project, Great Bear’s Dixie project, are both in these, the high-grade gold mineralization known to date is both in the confederation volcanics. As well, both projects are proximal to the south boundary of the Uchi geologic sub-province. So you’ve got a major structure there that’s separate, that both Great Bear’s Dixie and Argo’s Woco Project are proximal to.

And then the third thing would be, there’s actually comparable historical drill results at relatively shallow depths. Great Bear’s high-grade gold mineralization depths are showing about 150, 200 metres; Argo Gold, we’re in the 100 metre range. But good, high grade gold mineralization, you know, in a known prolific gold producing part of the world.

James West:   So what kind of drill results have you experienced?

Judy Baker:   Well, Argo Gold would have probably multiple intercepts of a couple ounces over a couple metres.

James West:   Okay, so these are vein-hosted?

Judy Baker:   Yeah. Both Great Bear’s Dixie, Argo Gold Woco, they’re narrow vein, quartz vein systems. So that’s similar to, whether it’s the Red Lake mines or the small, high-grade underground mines in the Wawa camp, right? And interestingly enough, like, in some time historically these type of assets have been out of favour, and people have wanted to go for low-grade, open pit –

James West:   Bulk tonnage.

Judy Baker:   All that kind of thing. But it’s interesting that these high grade, narrow-vein gold deposits have continued to produce for companies.

James West:   So I guess it’s a different expertise?

Judy Baker:   Mm-hmm. And so, like, if you look at Wesdome’s operated its Eagle producing over 40,000 ounces a year for over 20 years. And now they just, in the last couple of years, they’ve discovered multiple zones at Eagle. You have Richmont Mines producing 50,000 ounces for eight years; they’ve got into island deep, they got into twice the grade, twice the width, they took their production from 50,000 ounces to 80,000 ounces a year without increasing mill capacity, and Richmont Mines was sold for a billion.

James West:   Yeah.

Judy Baker:   So there’s value – and being seen in these high-grade, narrow vein underground gold systems that continue to produce for companies.

James West:   Sure.

Judy Baker:   So that’s – and I guess that’s one of the reasons we actually was part of the business plan, is for seeing gold production in Canada go up.

James West:   Okay. So where are you at today? Are you about to start drilling again, are you doing -?

Judy Baker:   Yep. Argo Gold is permitted for the plan is to start drilling early February at the flagship Woco project. We have a 25 metre drill program planned.

James West:   25,000 metres?

Judy Baker:   25,000 metres, sorry.

James West:   I was going to say: 25 metres, boy you’re going to hit a lot of gold with that!

Judy Baker:   25,000 metre exploration program planned; we’re just dealing with the river crossing permit, but we have our drill permits in place.

James West:   Okay, cool. And so you anticipate drilling into the same structure, the confederation volcanics?

Judy Baker:   Yes, exactly.

James West:   Where are the bama volcanics in all this?

Judy Baker:   Well, that’s the thing – they underlie, right?

James West:   So they could be deep. And with Red Lake, bar the door if you hit that kind of mineralization.

Judy Baker:   Exactly, right. And, like, our goal, like in the best, one of the, I think there’s four ounces per tonne over two metres? And, you know, with that kind of gold mineralization, obviously it’s a good indication of gold in the system.

James West:   Sure. So how much money have you got in the bank, and what’s the plan for raising more?

Judy Baker:   Argo Gold is in fundraising mode right now.

James West:   Oh, are you? What a coincidence! [laughter]

Judy Baker:   What a coincidence, yeah. So we’re basically looking at, it’s $1 million in flow-through and $500,000 hard.

James West:   A million dollar flow-through?

Judy Baker:   Yeah.

James West:   Well, it’s the right time of year for raising flow-through, isn’t it?

Judy Baker:   Absolutely. So yeah, from meetings we had, there’s expressions of, there’s interest even confirmed this week for over half that financing.

James West:   Oh, really? Well, I’ve got some people who would be interested in hearing about this, so we’ll talk about that. So then, new program starting in 25,000 metres; that’s not insignificant. I mean, that could be defining, really. That’s enough to outline a deposit.

Judy Baker:   Sorry – 2,500 metres.

James West:   2,500 metres? Oh, okay. Well, that’s still not insignificant – it’s more than 25 metres! I was going to say – you’re going to drill five holes of five metres deep.

Judy Baker:   It’s Friday.

James West:   Super shallow. It is Friday. Okay, great. Then so, and your other projects – you’ve got several cobalt projects in Ontario, too.

Judy Baker:   Yeah, actually, before I go on to the cobalt, I just want to just put the significance of the gold project in perspective. And that is that as we talked about that these high-grade gold projects have continued to produce, underground, narrow-vein systems; the other component is, Canada has actually become the fifth largest gold producer in the world, up from #8 five years ago. And this was some of what – some of the data I looked at with respect to embarking on this business plan.

And the other – and the reason that is, one of the reasons that is, is that mining companies want to have infrastructure in Western world countries, and the assets they have here have continued to produce for them. I think that’s because they can hire the best people, want to live in Western world countries.

And then of the Canadian gold production, Ontario is the largest producer, with over a third of production. So that’s been an increasing economic contributor for Canada.

James West:   Sure.

Judy Baker:   And Ontario is – so that’s, just to put that all in perspective.

Now, the cobalt projects come in, in early May the DRC and Glencore went to court over $7 billion in royalties, right? And Glencore is the only producer, the only Western world producer in the DRC left, right? And so 90 percent of the cobalt coming out of the Central African copper belt, okay, is where 90 percent of the cobalt is coming out of. But it’s a growth market, because of electric vehicles, electric power tools.

James West:   Sure.

Judy Baker:   So the whole battery market is driving a growth market, and you have, you know, a place where there’s an uncertainty of how much future supply based on politics.

So therefore, I think for the first time, we can maybe start to justify cobalt exploration in Western world countries. So that was what we said, okay, we think it’s time to start picking up some cobalt projects here, just kind of want to see how the production of cobalt moves forward coming out of the Central African copper belt to supply the market. And I think that’ll drive how much capital is available for exploration.

James West:   Sure.

Judy Baker:   And we’ve – yeah, three great projects.

James West:   Okay. Great. All right, Judy, let’s leave it there for now. We’ll come back to you after you’ve started drilling in February, and see how that’s going. Thanks very much for joining me today.

Judy Baker:   Okay, cheers. Thank you.

Midas Letter is provided as a source of information only, and is in no way to be construed as investment advice. James West, the author and publisher of the Midas Letter, is not authorized to provide investor advice, and provides this information only to readers who are interested in knowing what he is investing in and how he reaches such decisions.

Investing in emerging public companies involves a high degree of risk and investors in such companies could lose all their money. Always consult a duly accredited investment professional in your jurisdiction prior to making any investment decision.

Midas Letter occasionally accepts fees for advertising and sponsorship from public companies featured on this site. James West and/or Midas Letter may also receive compensation from companies affiliated with companies featured on this site. James West and/or Midas Letter also invests in companies on this site and so readers should view all information on this site as biased.

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