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Co. Gets Mining Going Again at Flagship Gold Project

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As a result, this Saskatchewan-based company will likely see a boost in its share price. Read about its joint venture partner and the gold sector here.

Omineca Mining and Metals Ltd. (OMM:TSX.V; OMMSF:OTCMKTS) restarted underground mining at its flagship Wingdam placer gold project in British Columbia's historic Cariboo mining district, according to a news release. Omineca's joint venture partner and the project operator, D&L Mining Corp., is now "advancing through bedrock toward channel crosscut No. 3."

Omineca "has the utmost faith in D&L and the current path of project advancement," the release noted.

British Columbia's D&L replacing Hamilton Gold Royalties as Omineca's partner on Wingdam resulted from Hamilton's now completed internal reorganization. D&L had been Hamilton's largest investor.

While the reorganization was in progress, explained the release, D&L took over operations at the project. Since D&L has been maintaining the underground workings and doing the necessary dewatering. Also, during that period, D&L did a full underground survey and geotechnical drilling to further confirm the course of the gold-bearing paleochannel.

Two-Pronged Approach at Project

Omineca is a Saskatoon, Saskatchewan-based junior gold company pursuing two tacks at Wingdam, its project of focus currently, the company said. One is underground placer gold mining, now underway.

"The Wingdam project encompasses 2.4 kilometers of a rich, placer gold-bearing channel buried 50 meters underneath Lightning Creek," the company noted. Geologist Stephen Kocsis described the channel as "containing some of the highest placer gold concentrations historically reported in all of the Cariboo mining district and perhaps British Columbia that remains unmined."

Bulk mining testing in 2012 of the gold present returned a grade of 13.6 grams per ton, the company said.

Omineca's other tack is exploration and drilling to identify the multiple hard rock sources of Wingdam's placer gold. Most recently, through a field program completed in September of last year, the company expanded a mineralized trend that runs parallel to and could be affiliated with the Eureka thrust fault. The trend now extends about 2,000 meters.

Also, during a 2023 review of all data amassed from work carried out at Wingdam, Omineca "refined and narrowed" five additional target areas, noted a news release.

"The Gold Price is Destined to Soar"

The current gold price is strong, at US$2007 per ounce ($2007/oz), noted Haywood Securities in a January report, which is positive for gold equities.

Haywood and other experts purport the gold price will move higher this year.

Brien Lundin, editor of The Gold Newsletter, explained in the January 10, 2023 issue that in the U.S., real interest rates, adjusted for inflation, must remain negative in the near future "or the entire house of cards comes tumbling down."

He continued, "As the investing and saving public continues to realize this, portfolios will become increasingly allocated toward gold. And given how relatively small the gold market is in comparison with global flows, the gold price is destined to soar to levels that seem fantastic today."

There may be volatility in the gold price, Lundin added, and encouraged investors to "trust this trend, as things are set to accelerate soon."

J.P. Morgan expects the gold price will have a breakout rally in mid-2024, and financial services firm UBS projects it will hit a record US$2,150/oz by year-end, according to a Reuters article. However, for the gold price to get there, the Federal Reserve must lower real interest rates.

Other factors that will support a higher gold price, the article noted, are continuing geopolitical risk and central bank buying.

The Catalyst: Stock Price Poised To Rise

As the restart of mining at Wingdam gets underway and further updates about progress are released, Omineca should see a rerating, wrote Research Capital Corp. Analyst Bill Newman in a March 2023 research report.

"The announcement of the recovery of the first gold from the new mining operation could be a near-term catalyst for the stock," he added.

Newman rated Omineca a Speculative Buy, and given the company's share price at the time, CA$0.16, the implied return for investors was 369%. Today, Omineca is trading even lower, at about CA$0.055.

Technical Analyst Clive Maund also recommended the mining company as a Speculative Buy in August 2023.

streetwise book logoStreetwise Ownership Overview*

Omineca Mining and Metals Ltd. (OMM:TSX.V; OMMSF:OTCMKTS)

*Share Structure as of 9/25/2023

Omineca having recommenced mining operations at Wingdam is great news, according to experts, and the company should eventually see the market take note of this major development.

Ownership and Share Structure

According to Reuters, Omineca has two insider investors, and they own 5.7% of it. They are President/Chief Executive Officer Thomas MacNeill with 3.78%, and Chief Financial Officer/Director Andrew Davidson with 1.92%.

The company has one institutional investor, Sprott Asset Management LLC, which owns 5.11%.

Retail investors hold the remaining 89.19%.

Omineca has 178 million (178M) shares outstanding and 168M free float shares. The company's market cap is CA$7.96M, and its 52-week price range is CA$0.05−0.20 per share.

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Important Disclosures:

  1. [Omineca Mining and Metals Ltd.] is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of [Omineca Mining and Metals Ltd.].
  3. [Doresa Banning] wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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