Canadian Gold Corp Finds Open-Pit Value

Emperor Metals Inc. (EMAUF:OTCMKTS; AUOZ:CSE) is a Canada-based exploration company focused on developing gold properties across the Canadian Shield. It is currently focused on developing the Duquesne West Gold project in Quebec.

The firm has also acquired 100% interest in Hemlo North Property and Pine Grove & Pic River Property. The Hemlo North Property comprises 12 mining claims in Ontario, with the Pine Grove & Pic River Property consisting of another 128 mining claims in the same province.

The Duquesne West Gold Property, where the latest results were gathered, is located 32 kilometers northwest of the city of Rouyn-Noranda and 10 kilometers east of the town of Duparquet. It lies within the Duparquet gold mining camp in the southern portion of the Abitibi Greenstone Belt.

The Catalyst: New Assays

On December 5, Emperor Metals Inc. announced additional assay results from its summer 2023 drilling campaign at the Duquesne West Gold Project.

The company reported that 14 diamond drill holes had been completed, representing a total of 8,579 meters. Two holes were found to be of particular interest:

DQ23-06 intersection (5.2 m of 2.1 g/t Au) was designed to extend mineralization 500 meters eastward along strike and down plunge of high-grade mineralization. It intersected mineralization predicted by the model, which will help to potentially increase the grade and add ounces laterally to the site's mineralized stopes model.

DQ23-09 intersection (13.2 Metres of 3.8 g/t Au (including 5.6 m of 7.5 g/t Au)) was designed to intersect near-surface mineralization to begin strategically drilling a potential development area for a Phase 1 open pit.

According to the company, "These partial results and the drill core visuals from our 2023 campaign suggest resource expansion within and outside the open pit concept."

On December 5, Technical Analyst Clive Maund lamented, "We haven't done too well with [Emperor Metals] because we bought it too early back in Summer, after which it continued even lower, but the good news is that it has turned the corner, and begun a bull market."

Emperor Metals Ltd. CEO John Florek explains, "With the recent development of identifying the open pit potential on the property, holes DQ23-09 to 14 targeted the strategic vision to expand the Phase 1 open pit potential. DQ23-09 confirms that these high-grade lenses seen at depth are expressed at the surface and could make very attractive stockpiles for delivery to nearby mills."

"Only an estimated 30% of the core from historical drilling was sampled at the surface by previous operators," he continues, "who did not examine the additional lower-grade bulk tonnage material crucial to lowering the stripping ratio. As a result of recent work to locate and sample this material in the historical core library, more than 3,000 meters of additional sampling will be sent out for assays; sampling of historical core is ongoing."

He says, "The intercept at DQ23-06 is very significant since it expands the mineralization by an additional 0.55 km along strike and plunges in an area of virtually no drilling. This area has the potential to add significant ounces to this deposit. Our vision to develop a multimillion-ounce deposit with multiple mining scenarios on the property continues to progress. The proximity to multiple mills and infrastructure in a Tier 1 mining district makes this project highly valuable compared to any competitors."

Why This Sector: Safe, In-Ground Gold in Friendly Territory

Say what you will about Canada; the country remains one of the safest mining jurisdictions in the world. It's a safe place to be a miner, and open pit mining, such as that which Emperor Metals Inc. has planned for the Duquesne West Gold Project, is one of the safest types of mining.

As an article on Sciencing.com explains, "Open-pit mining is much safer than shaft mining. In underground mining, the threat of a cave-in or release of toxic gas is a constant concern. When shaft mining was the most common method of ore extraction, thousands died in cave-ins, gas events, and accidents involving equipment."

"In 1907 alone, more than 3,200 deaths related to mining occurred," the article continues, "Today, with safer mining processes, such as open-pit mining, safer equipment, and a general increase in safety awareness, mining deaths have fallen considerably."

In addition to being safe for miners, Canada is a safe jurisdiction for mine operators. It's adjacent to the U.S.A., with reasonably similar government and regulation regimes, and has been home to many different mining companies over the past couple of centuries.

Why This Company? Open Pit = Easy Access

Emperor Metals Inc. is sampling near-surface core from the historical core library that previous explorers did not assay. According to the company, up to 70% of this core has yet to be assayed.

So far, over 3,000 meters have been sampled and will be sent to the laboratory for analysis. Partial assays for these reported drill hole results continue to increase confidence in considering an open pit potential for the Duquesne West deposit.

Thus far, full laboratory results for drill holes DQ23-01, 03, 04, 05, and 09 have been received. DQ23-09 was rushed through the laboratory to advance the company's understanding of near-surface mineralization.

Approximately 65% of the assays have returned from the laboratory, with EmperorMetals Inc. still awaiting additional assay results. Fourteen diamond drill holes were completed this summer on the property, with the samples being analyzed at SGS Laboratories in Lakefield, ON.

Why Now? Struggled Earlier, Starting to Build Steam

On December 5, Technical Analyst Clive Maund lamented, "We haven't done too well with [Emperor Metals] because we bought it too early back in Summer, after which it continued even lower, but the good news is that it has turned the corner, and begun a bull market."

"By mid-October, we had broken even on our original purchase, and we were up significantly on the 2nd purchase, which was at a lower level, but in recent days, it has dropped back some."

"On the latest 6-month chart," Maund explains, "we can see that the picture now looks a lot more positive as the price has advanced sharply out of the Double Bottom shown that formed at a low level with the result that it has broken out of its earlier persistent bear market downtrend."

"With the Accumulation line strong, its earlier overbought condition having fully unwound (MACD), and its rising 50-day moving average having caught up to the price in readiness for it to cross the 200-day, everything is in place for it to go on to break out of its current rectangular consolidation pattern into another uptrend, and this looks most likely to happen when gold breaks out above its key resistance at $2100 to launch into a major uptrend."

"We, therefore, stay long," Maund advises, "and this is viewed as a good point to buy or add to positions, especially if it drops a little further to the bottom of the current trading range."

"The reason that Emperor backed off yesterday towards the lower boundary of its trading range was gold's temporary setback following its failure to break above $2100 at the start of the week, but gold is expected to redouble its efforts and achieve this milestone in due course and in the meantime, we can, if so inclined, take advantage of Emperor's dip to the bottom of its trading range to buy it or add to positions."

According to Maund, "The 3-year chart shows a number of interesting technical points more clearly. One is the marked increase in volume since July, which is viewed as bullish as it shows a lot of rotation of stock from weaker to stronger hands, and because most of this volume has been upside volume as revealed by the strongly rising Accumulation line, it makes it even more bullish."

"The reason why the price has stopped here to mark out a trading range is that it is working off the resistance arising from the considerable volume of trading just above the current level during the 1st half of the year. Once it breaks above this resistance, suggested as highly probable by the strongly advancing Accumulation line, it should embark on a sizeable uptrend, and there is ‘plenty of gas in the tank' for this as the MACD indicator has fully neutralized, showing that it is not overbought at all now."

"We, therefore, stay long," Maund advises, "and this is viewed as a good point to buy or add to positions, especially if it drops a little further to the bottom of the current trading range."

"Emperor has started trading on the US OTC market but on pitifully low volumes, although volumes should improve as the price rises, so if you do attempt to buy it on this market, be sure to set limit orders," he cautions.

Ownership and Share Structure

As of November 2023, Emperor Metals Inc. had 69,838,843 shares outstanding, alongside 21,466,292 warrants and 4,775,000 options, for a fully diluted base of 96,080,135.

According to Reuters, 13.52% of the company is held by management and insiders. Director Alex Horsley owns 5.53%, with 3.86 million shares. CEO, President, and Director John Florek owns 3.64%, with 2.54 million. CFO and Director Sean Mager owns 2.15%, with 1.50 million. Independent Directo and Chairman John Williamson owns 1.48%, with 1.04 million, and Director Ian Harris owns 0.72%, with 0.50 million

The rest is in retail.

Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of [Emperor Metals Ltd.].
2. [Owen Ferguson] wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
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