Explorer Submits Documentation to Seek Gold, Silver in Spain

Base metals + gold and silver exploration company Emerita Resources Corp. (EMO:TSX.V; EMOTF:OTCMKTS; LLJA:FSE) announced it has submitted all of the documentation needed to support its application to Spanish authorities for the exploitation license for its wholly owned Iberian Belt West project.

When granted, the exploitation license in Spain has a 30-year term and can be extended for two more 30-year periods, the company said.

"The submission of this detailed documentation in support of the Exploitation Licence application marks an important milestone for Emerita," said company President Joaquin Merino. "We are moving from a purely exploration focused endeavor to a development company with an asset that merits proceeding with detailed engineering studies and demonstrates our intention to commit to a very long-term investment in Huelva Province. We are very excited to take the IBW Project to the next phase in its development."

Merino said the company has had several "very productive" meetings with government officials Huelva Province and is "highly encouraged."

Clarus Securities has rated Emerita Speculative Buy, with a target price of CA$3.75 per share, which would be an increase of more than 800% over Monday's price of CA$0.415 per share.

Its report highlighted the mineralization on the IBW and the company's gold recovery optimization as positive factors in its assessment, as well as the potential for further exploration along the Romanera and Infanta regions of the property.

Clarus Securities has rated Emerita Speculative Buy, with a target price of CA$3.75 per share, which would be an increase of more than 800% over Monday's price of CA$0.415 per share.

"We believe the maiden resource confirms our view that IBW will be a mine with our estimated CA$730 million net present value," Clarus analyst Varun Arora wrote. The resource "is comparable in size and grade to current advanced stage polymetallic projects that are trading at seven-plus times Emerita's CA$110M market cap."

IBW hosts the La Romanera, La Infanta, and El Cura deposits. Emerita released a maiden NI 43-101 compliant mineral resource estimate for La Romanera and La Infanta deposits that contains a combined 18.8 million tonnes, including a 14.07 million tonnes indicated resource at 7.63% zinc equivalent (Zn Eq) and a 4.71 million tonnes inferred resource at 9.29% Zn Eq.

The company said it was comparable in grade to Sandfire's Aguas Teñidas Mine, with proven and probable reserves of 37.1 million tonnes grading 2.6% Zn, 1.6% Cu, 0.8% Pb, and 36.1 g/t Ag. It is also 59 kilometers from Atalaya's Rio Tinto Mine.

One of 8 'Immediate Buys'

Emerita said the supporting documents it has submitted include information on mining and processing techniques, associated infrastructure, equipment, tailings storage facilities, and a restoration plan.

While not in compliance with National Instrument 43-101, the documentation includes "environmental parameters, basic engineering, and these studies along with a revised mineral resource estimate incorporating new drill results planned to be prepared when metallurgical test data is received, (which) will comprise the basis for an NI 43-101 compliant economic study in the first half of 2024," Emerita said in a release.

Technical Analyst Clive Maund included the company in a list of "8 Stocks That are Rated Immediate Buys Here." 

Dean Bristow last July reviewed the company positively, highlighting past production on the company's properties, the region's reputation for producing high grades, and the company's good financials.

"For now, Emerita is well funded with plenty of ongoing exploration continuing to generate news over the coming weeks and months," he said.

In August, Technical Analyst Clive Maund included the company in a list of "8 Stocks That are Rated Immediate Buys Here." Maund noted that "the confluence of moving averages and strong accumulation line suggest that it is about ready to begin another upleg."

The Catalyst: Gold Soars

Gold prices hit a new intraday high early on Monday, when most active gold futures spiked to hit US$2,152.30 a troy ounce during Asian trading, The Wall Street Journal reported.

Most active gold futures spiked to hit $2,152.30 a troy ounce during Asian trading hours, FactSet data showed and notched an all-time settling high of US$2,089.70 a troy ounce on Friday.

One newsletter writer noted the gold market was rising due to intensifying global conflicts and uncertainty.

There is a significant gap between supply and demand for the yellow metal, Rick Mills wrote in Ahead of the Herd.

"Even though major gold miners are high-grading their reserves, mining all the best gold and leaving the rest, they still didn't manage to satisfy global demand for the precious metal, not even close," Mills wrote.

Gold has long been "considered a safe-haven asset for retaining its value throughout history" during market uncertainty, Forbes wrote in "Why Gold Is a Good Investment Right Now" in May.

And according to a recent Gallup poll, about one-quarter of Americans think gold is the best asset to invest in long-term, its highest level in more than a decade. 

Ownership and Share Structure

Reuters provided a breakdown of the company's ownership and share structure, where management and insiders own approximately 5.80% of the company. According to Reuters, Chairman Michael Lawrence Guy owns 1.90% of the company with 4.32 million shares, CEO David Patrick Gower owns 1.22% of the company with 2.76 million shares, President Joaquin Merino-Marquez owns 0.92% of the company with 2.09 million shares, Director Catherine Stretch owns 0.70% of the company with 1.60 million shares, Director Marilia Bento owns 0.44% of the company with 1.00 million shares, CFO Gregory Duras owns 0.29% of the company with 0.65 million shares, Corporate Secretary Damian J.D. Lopez owns 0.20% of the company with 0.46 million shares, Executive Vice President Ian T. Parkinson owns 0.11% of the company with 0.25 million shares, and director Michael Jones owns 0.02% of the company with 0.05 million shares.

Institutions own 10.47% of the company, as Eric Sprott owns 9.11% of the company with 20.72 million shares, Merk Investments LLC owns 1.21% of the company with 2.75 million shares, Palos Management Inc. owns 0.09% with 0.20 million shares, and Timelo Investment Management Inc. owns 0.06% with 0.14 million shares.

According to Reuters, there are 227.32 million shares outstanding with 214.13 million free float traded shares, while the company has a market cap of CA$97.45 million and trades in a 52-week range of CA$1.03 and CA$0.255.

Important Disclosures:

1. Emerita Resources Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
3. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for 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. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

For additional disclosures, please click here.