In a Jan. 21 research note, Couloir Capital Ltd. commented that diversified mineral explorer Group Ten Metals Inc.'s (PGE:TSX; PGEZF:OTCQB; 5D32:FSE) substantial maiden resource report provides a solid foundation for additional near-term resource expansions and upgrades.
The report explained that the platinum group elements, precious and critical metals company is continuing with its extensive exploration efforts at its Stillwater West Property in Montana and has achieved numerous milestones since Couloir first initiated coverage on the company in early 2021. Notably, Group Ten has managed to advance the Stillwater West Nickel-PGM project from an exploratory property with an undefined resource to its maiden NI 43-101 resource report.
The maiden resource report found that the property is highly prospective for nickel and platinum group metals (PGMs). According to the report, "the property has an inferred resource of 1.56 Blb Ni eq or 6.07 Moz Pd eq, with average grades of 0.45% Ni eq or 1.20 g/t Pd eq." There are an estimated 2.44 million ounces of PGMs and precious metals, and 1.11 billion pounds of base metals believed to be in the ground at Stillwater West.
The company is now waiting to receive the assay results from 14 holes drilled during its 2021 drill program. The firm plans to incorporate those results into an updated resource report in 2022.
The firm entered into an agreement to option its Black Lake-Drayton prospective gold property to Heritage Mining.
Couloir remarked that "that globally M&A for nickel and PGM miners has begun to heat up, which we believe may be the beginning of a super-cycle as major players in the mining industry seek to reposition themselves as suppliers of the metals of the future economy (including nickel and PGMs)."
The company has now completed 5,138 meters of its 2021 10,000-meter resource expansion drill program. The drilling is expected to continue in Q2/22.
According to Couloir Capital, Group Ten has a large number of options outstanding that if exercised would bring in around $12.42 million that would provide reserve capital.
The Couloir report noted that its valuation estimates for Group Ten might change favorably if additional assays from the company's 2021 drilling program have a positive impact and end up being incorporated in a 2022 resource update. Other potential positive catalyst could possibly come from future developments at the firm's Black Lake-Drayton Project and its option agreement with Heritage.
Couloir said it is maintaining its "Buy" rating and updating its fair value price valuation for Group Ten Metals Inc. from CA$0.49/share to CA$0.61/share.
Group Ten Metals Inc. shares trade on the TSX Venture Exchange under the symbol "PGE" and last closed for trading at CA$0.355 on Friday, Jan. 28, 2022. The company's shares also trade under the ticker symbol "PGEZF" on the OTCQB market.
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Disclosures for Couloir Capital, Group Ten Metals Inc., Jan. 21, 2022
This report has been prepared by an analyst on contract with or employed by Couloir Capital Ltd. The analyst certifies that the views expressed in this report which include the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report accurately reflects his or her personal views about the subject securities and the issuer. No part of his / her compensation was, is, or will be directly or indirectly related to the specific recommendations.
Couloir Capital Ltd. is affiliated Couloir Capital Securities Ltd., an Exempt Market Dealer. They shall be referred to interchangeable as Couloir Capital herein. Part of Couloir Capital's business is to connect mining companies with suitable investors that qualify under available regulatory exemptions. Couloir Capital, its affiliates and their respective officers, directors, representatives, researchers and members of their families may hold positions in the companies mentioned in this document and may buy and/or sell their securities. Additionally, Couloir Capital may have provided in the past, and may provide in the future, certain advisory or corporate finance services and receive financial and other incentives from issuers as consideration for the provision of such services.
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