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Scarcity of new discoveries since 2010 magnifies demand for gold juniors with strong projects

Aug 28, 2020

Northern Ontario's mining legacy, an abundance of geological data, and established track record with mineral explorers, developers and producers, position it as a world-class destination for the industry. 

Gold exploration and early stage companies are front and centre in the recent huge rally at the TSX-Venture exchange, which has roared back after hitting the bottom of the tank earlier this year when the coronavirus pandemic froze global economic activity.

The S&P/TSX Venture Composite Index has more than doubled to 739.5, after dropping to a 10-year low of 358.04 in early March 2020.

Much of that surge has been driven by gold investors including junior gold companies, which are suddenly back in a large way as the price of the precious metal sits near an all-time high.

Top performers on the TSX-V include Pure Gold Mining Inc., up 316 per cent since early March to $2.00 per share, and Great Bear Resources Ltd., up 274 per cent during the same period to $15.74. Both are developing gold projects near Red Lake, Ontario.

The interest in mining and exploration comes after a long drought, during which many executives complained that it was hard to attract investors or raise money for exploration.

Gold prices began steadily climbing last summer, driven by declining global interest rates, a weakening U.S. dollar and general economic uncertainty. Since January, gold prices have risen 27 per cent and are now hovering close to the US$2,000 per ounce benchmark.

The scarcity of new gold discoveries in the past decade has now magnified demand for junior gold mining companies with strong projects.

The exploration drought has lasted so long that a lot of majors do not have the exploration projects lined up and this is what created so much interest in the junior space. 

Northern Ontario has so much to offer when it comes to its natural resources. The mines that dot the landscape both old and new are a true testament of the resilience to its northern pioneers and the prospectors and developers of today. 

Mining Life & Exploration News has been following the industry for over three decades and has watched and reported as the industry has gone through its ups and downs - and one thing is certain - gold is a safe bet and it's here to stay!  

In the next issue of Mining Life we will be featuring Northwestern Ontario as the mineral rich region it is and the producers and explorers that make it what it is going to be. We will cover the Juniors, Mid-Tier producers and Senior mining operations in what we will be calling ``The Northwestern Ontario Mining Report``. The area from Wawa to Kenora is experiencing a mining boom like never seen before and the communities in which these mines are located are proud and look forward with optimism.

Whether you are a gambler or not it would be a safe bet to review the next issue and see what Northwestern Ontario has to offer. Technology has evolved which makes discovering, mining and processing the minerals and metals more productive, more environmentally sound and more cost efficient. 

The last two issues of Mining Life are available online.



Tags: Northern Ontario / Exploration / Gold / All Articles