Renforth is a Canadian-focused gold & base metal exploration company that is both asset and cash-rich with a collection of four projects within the Abitibi Greenstone Belt and over C$6 million in cash and securities.
Renforth continues to release results from its 15,569-metre (m) drill program aimed at growing its current, near-surface, NI 43-101 resource of 281,800 gold ounces at 1.77 grams per tonne (g/t) at its Parbec Gold Project in the Abitibi region of Quebec, a world-class mining region.
With Renforth’s current focus on growing the resource at Parbec, management has expressed an interest in selling the Company or the Parbec project in the next 12-18 months.
Renforth has deal-making experience as it recently sold its 100% stake in the New Alger gold property to Radisson Mining (TSXV: RDS).
As calculated in the report, eResearch valued Renforth by the sum of its parts, including the potential sale value of Parbec, the value of its other projects (Surimeau, Malartic West, and Nixon-Bartleman), as well as its cash and securities holdings.
The result of the calculation is a Market Cap of C$78.9 million or $0.25/share based on the fully diluted share count of 321.1 million.
The Parbec Gold project is Renforth’s principal asset and it sits on the Cadillac Break, near Malartic, Quebec, and adjacent to the Canadian Malartic Mine that produced over 568,000 ounces of gold in 2020 and is operated by Agnico Eagle (TSX:AEM | NYSE:AEM) and Yamana Gold (TSX:YRI | NYSE:AUY).
This week, Renforth released assays from PAR-21-133, a 279m hole that was drilled to twin the historical hole PAR-88-44 (drilled in 1988). PAR-21-133 intersected 12.5m of 6.9 g/t gold, with a sub-interval of 0.35m grading 118.7 g/t gold.
The recently completed drill programs focused on infill drilling, extending the resource at depth and along strike, and twinning some previous drill results from 1986 to 1993 in order to incorporate those results into the new resource estimate at Parbec scheduled for completion in Summer 2021.
From the recent drill programs, including the twinning of the holes drilled between 1986 and 1993, Renforth should be able to incorporate those drill results that were excluded in the 2020 resource update and at least double the current project resource.
As a near-surface resource, eResearch believes the Parbec project would be an attractive asset to any gold producer in the area, such as Canadian Malartic Mine, Wesdome (TSX:WDO), or Eldorado Gold (TSX:ELD), that is looking to add or replace depleting ounces.
M&A activity in the Abitibi area is strong, highlighted by multiple deals over the past 2 years, including Kirkland Lake Gold (TSX:KL) acquiring Detour Gold (TSX:DGC), Wallbridge Mining (TSX:WM) buying Balmoral Resources (TSX:BAR), Yamana Gold securing the Wasamac & Camflo properties from Monarch Gold (TSX: MQR), and Eldorado Gold (TSX:EGO) purchasing QMX Gold (TSXV:QMX).
Each one of these deals shows a healthy premium that should reflect well for Renforth as it continues to build “gold ounces in the ground”.
Renforth is focused on the Abitibi Gold Belt and is not a “one-trick pony”. Besides Parbec, Renforth is also exploring at its Surimeau property, a battery-metals project with the potential to host a large-scale sulphide nickel & platinum-group elements (PGE) system as well as indications of a copper-zinc Volcanogenic Massive Sulfide (VMS) system.
The Company’s other two projects include the Malartic West copper and silver project near Malartic, Quebec and the Nixon-Bartleman gold project, near Timmins, Ontario.
Renforth is fully funded for its 2021 exploration programs after selling its New Alger Gold Property to Radisson Mining and then raising $3.2 million in an equity financing.
Renforth is currently trading at C$0.09 with a market cap below C$25 million but with gold in the ground at Parbec and unaccounted value at Surimeau, Malartic West, and Nixon-Bartleman, eResearch believes there is the potential for a re-rating once the updated resource is released.
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