Stock Bazar: 3 Ridiculously Cheap Junior Mining Stocks

Welcome to the Spotlight Stock Bazar! Haggle at your own risk, likelihood of burning, misdirection and pickpoketing: high/certain.

We know that fortunes are made and lost in these volatile times. This is where 20 baggers spring from and when majors collapse so… I’d like to at least be in the lottery for riches when this virus and mess blows over. I am talking small investments for potential mighty returns (but also possible complete losses). The ‘meat-grinder end’ of the market is not for the faint hearted.

This downturn has destroyed a lot of high-volume, low-priced stocks. So, for the first time in a while, I browsed aimlessly through the German Lang & Schwarz junior mining listings for novel bargains.

Three stood out as potentially respectable to me, based on my own parameters, using gut-feeling and a variable ratio of:

  • A team with experience and success
  • A project in a mining positive region
  • Money in the bank or partnership/JV funding/production

I am aware this is a fools game to play, but, fortune favours the brave and stupid. I have not looked at market cap, volume or any vital statistics yet, just the cliff notes.

ALWAYS DO YOUR OWN EFFING RESEARCH BEFORE INVESTING.

A drill on site at Avrupa’s Alvalade in Portugal
A drill on site at Avrupa’s Alvalade in Portugal

AVRUPA MINERALS – €0.002 (L&S Exchange, 13:40, 30-3-20)

  1. Team
    1. Financing ability with previous companies ✔
    2. Technically proficient geologists on board ✔
    3. Discoveries in a variety of locations ✔
    4. Likability factor ✔

I’ve met Paul Kuhn (CEO) several times around the world and enjoyed our chats. He knows his projects and is currently based in Lisbon managing operations at Alvalade. He has been involved in discoveries and is a technical geo so, gets an extra ☑ from me!

  1. Project
    1. Mining Positive Region 〤
    2. Known Geology ✔
    3. Historic Production ✔
    4. Compliant Resource 〤/✔

Avrupa have 2 main projects, in Portugal and Kosovo. Their Portuguse licence is optioned to a local group, but operated by Avrupa and sits on the prolific Iberian Pyrite belt. Drilling has been hit & miss, but there is definitely mineralisation in the area and a large amount of historic work on the peninsular-wide Iberian Pyrite Belt.

Portugal has one of Europe’s biggest copper mines in Neves Corvo (Lundin/Somincor) in the south and active exploration for lithium and gold in the north. It is a mediocre jurisdiction, halted by a thoroughly inefficient government structure, not a lack of will to develop.

I have secretly visited the Sesmarias (Alvalade) area several times to steal samples for my own rock collection, so I know it fairly well. I have friends who work at the superb Museo de Lousal (local mining museum) and report back as well, which is what warms me up to development here.

The mineralisation and shear structure is huge and runs from near to the ‘Rio Tinto’ (yes, that’s where the name comes from!) in South-Central Spain to Central Portgual. Aljustrel, Lousal, Neves Corvo and Alvalade. There is absolute real potential for another significant and world class discovery here.

The Republic of Kosovo… Here’s where we get a bit messy. The Kosovan government may be about to collapse, with the recent resignation of their premier after a vote of no confidence, this already tense Balkan region may not see political stability for some time, and even as this builds, it’s priorities are going to be healthcare, infrastructure and security, before it establishes a workable mining code. But, it will surely come round to mining in due course.

That’s not to say the geology isn’t there at all. Avrupa have roughly defined a200x100x75m gossan zone at ‘Slivovo’. It has enriched gold values, is easily accessible from the capital and has a defined resource estimate of c.2440kg of gold at a 3g cut-of, from surface.

This could very easily provide mining cashflow and value for Avrupa, who have JVd the project with Byrnecut International Ltd. (an Australian Explorer). This is where I diverge from the company’s plans… JVing an easily accessible and manageable project to a mysterious international service company, rather than taking on the development and targeting profits seems lazy to me. Byrnecut don’t even list this project on their website.

  1. Money
    1. Money in the bank ✔
    2. Funding partnership ✔
    3. Responsible spending 〤

Avrupa have some funds available from JV payments as well as funding agreements with Antofagasta for exploration in Portugal. I have had to give a 〤 for responsible spending as, I don’t think their Kosovan project was managed with genuine cashflow in mind. High dilution here, appears to be bracing for a rollback so… Added risk on any investment but still, it is so darn cheap!

Rigs on site at Aben’s forrest Kerr project in BC
Rigs on site at Aben’s forrest Kerr project in BC

ABEN RESOURCES – €0.035 (L&S Exchange, 14:32, 30-3-20)

  1. Team
    1. Financing ability with previous companies ✔
    2. Technically proficient geologists on board ✔
    3. Discoveries in a variety of locations ✔
    4. Likability factor ✔

I spent a little time with Jim Pettit in Munich last year and he seemed a positive character. Director Ronald Netolitzky was involved in the discovery of Eskay Creek, Snip and Brewery Creek mines and (which are practically next door to Aben’s ground) and sales to Yamana and Osisko on other projects.

  1. Project
    1. Mining Positive Region ✔
    2. Known Geology ✔
    3. Historic Production ✔
    4. Compliant Resource 〤

Another British Columbia ‘Golden Triangle’ Story, not much point in going into specifics as most companies up there are effectively poking the same rock. Drill results are good with intercepts and known mineralising intrusions from the Stickine, Stuhini and Hazleton groups (common volcanic units across the region). Aben’s land cuddles up to Crystal Lake Mining’s project and both the CLM and ABN teams stage from Bob Quinn airstrip, near to the Bell II heliskiing (and alcoholic geologist’s) lodge.

If you like the ground and project, you’ll may have a better chance of a big hit on the other side of the Forrest Kerr hill with CLM, just by landmass alone, CLM have a bigger area to put holes into, with the same rocks… Or why not invest something into both and cover the whole mid-Eskay region!?

  1. Money
    1. Money in the bank ✔
    2. Funding partnership 〤
    3. Responsible spending 〤

Aben declared $1.5m in the bank in their last NR in Nov 2019, I know they’ve been to PDAC and around so, maybe shave off a flew flights. Responsibility points lost here, because their property is only helicopter accessible. Completely necessary in the region, but a big cost that 90% of the world’s projects don’t need to spank cash on.

Galane’s Mupane facilities, in the Botswana rain
Galane’s Mupane facilities, in the Botswana rain

GALANE GOLD – €0.032 (L&S Exchange, 14:57, 30-3-20)

  1. Team
    1. Financing ability with previous companies ✔
    2. Technically proficient geologists on board 〤
    3. Discoveries in a variety of locations ✔
    4. Likability factor 〤

A very different criteria required here, Galane are producers so, they need technical and operations managers on their board, a geologist would be odd! Their board have held senior positions at majors worldwide and have primarily financial backgrounds. While they have adequate financial experience, it’d be nice to see an engineer here for competency’s sake.

  1. Project
    1. Mining Positive Region ✔
    2. Known Geology ✔
    3. Historic Production ✔
    4. Compliant Resource ✔

Botswana eh! Mupane eh! Bought from IAMGOLD eh! Galane have existing production in reliable deposits, which may be stunted with export and travel bans in Botswana right now, but means they’re cashflow positive, which I like! They also have producing operations in South Africa with their acquisition of Galaxy Gold and one of the oldest active mines in the world. Botswana and South Africa have potential human-rights and staffing issues, but speedy googling has raised no direct accusations of malpractice here so, we’ll reserve judgement.

  1. Money
    1. Money in the bank ✔
    2. Funding partnership 〤
    3. Responsible spending ✔

P-p-p-pick-up-a-producer… Again, both Mupane and Galaxy operations are cashflow positive. As long as everybody is getting paid fairly, I don’t see any issues here. Check their G&A, but if they’re paying their own way, this is a viable business and, who cares what they’re spanking on flights and bubble baths?!


These are three randomly picked companies from a long long list. They may or may not be suitable for investment, I have only skimmed the surface.

As always, I publish company responses to my notes every time they’re received so, Avrupa, Aben or Galane are welcome to join me for a chat if they like!

For now, have fun and play safe out there!

Liam
Spotlight Mining