I decided to put together a little list of factors that are influencing me personally regarding the odds of finding something of economic value at Karratha.
Since we have so little actual data at this point, and the first exploration results from phase 1 at their Karratha land holdings should start hitting the newswire in a matter of weeks, the highest RISK and thus highest potential reward is being positioned now.
Therefore I summarized a few snippets of what we know and/or think we know at this point regarding the gold mineralization. The following text includes parts of basically “hearsay” and should be considered as just that:
- “Fossiker” holes present for approximately 8 km along Purdy + Comet Well (Novo believes this is where the conglomerate sheets are outcropping/”daylighting”).
- Seed shaped nuggets reported to be found hundreds of kilometers away from Purdy’s Reward (We don’t know if this is the same type of mineralization)
- Multiple ASX listed juniors with land holdings in Pilbara has reported finding nuggets on their properties.
- Decades old drill intercept tens of kilometers further into the basin reported 0.5m of about 10gpt, but supposedly never assayed the conglomerates that hosts the nuggets at Purdy’s Reward.
- We still don’t know if or how far the mineralized conglomerates potentially extends into the basin.
- Novo states that the outcropping conglomerate sheets vary in thicknes between 5 m and 20 m (Mean: 12.5 m).
- Hearsay: Original “fossiker” poster on Stockhouse who foresaw the widespread distribution that was shown in Novo’s video presentation claimed that fossikers could dig holes followed by other fossikers that continued to dig deeper in the same holes and find more nuggets. (I don’t think we know for sure if this is from the same conglomerates as Purdy’s)
- Novo’s first (and only) bulk sample assayed ~67 gpt (including ~9 gpt of fine gold)
- Hearsay: Original “fossiker” poster on Stockhouse showed pictures of nuggets even bigger than the biggest nugget that Novo dug up in the latest video (along with many smaller ones).
- The 9 gpt fine gold present in the bulk sample is about the same grade as the 0.5 m intercept drilled tens of kilometers further into the basin (This was supposedly not from the same conglomerates as from where Novo’s bulk sample was taken)
Recent Insider Action: Votes of confidence (or lack of confidence)
- Kirkland Lake makes a deal with Newmont to buy a large chunck of Newmont’s holdings in Novo.
- Newmont then tries to reneg on the deal but is forced to comply when Kirkland threatens with litigation.
- Kirkland Lake takes down 100% of a private placement totalling $56 M at $4/share and claims they want to be in “early”.
- Kirkland Lake’s investment in De Grey Mining is announced shortly after Novo’s video presentation.
- Eric Sprott who is the largest shareholder of Kirkland and already the second largest shareholder in Novo (thus have a SIGNIFICANT stake in Novo already, both in terms of % as well as $) has bought large amounts of stock in the open market at around $6.30 just last week.
- NO insider has thus far taken any profits EXCEPT a 2.5% reduction by Richmond Partners even thou first systematic “proof of concept” results should be coming within days, weeks or months. (Considering that probably much of management’s net worth is made up of Novo stock ATM, I am very surprised that they haven’t taken any profits at all).
- Quinton supposedly owns about 4 million shares that are worth CAD$33.6 M at $8.40/share. Given his GAV is sub $0.60, I’m amazed that he hasn’t taken some money off the table already.
- Jay Taylor’s personal RETIREMENT portfolio included a 30% stake in Novo prior to the run up based on Karratha (by far his largest holding).
- Hearsay: Jay Taylor recently mentioned that Quinton SUPPOSEDLY responded with something along the lines”No, it’s better, it’s bigger” when asked if he thought he had find a new “Wits” (This is a judgement call based on ones perception of integrity/honesty and the fact that this whole theory is basically Quinton’s “baby”)…
- In the same video, Jay stated that Novo now makes up 50% of his retirement portfolio…
- Although Jay obviously has taken profits along the way (along with a lot of people), he has thus allegedly INCREASED his exposure to Novo in relative as well as absolute terms even thou market cap is way higher and perceived risk is higher according to many. (We have no way to confirm any of this of course).
- Moriarty states that Novo is still his biggest holding even after making 600%+ gains (or thereabout.)
- Final note: Most of the above parties have been on site.
Deposit style / Geology
- We basically know that we have conglomerates containing nuggety gold as well as fine gold (according to Novo’s bulk sample).
- We don’t know exactly how the gold got there, but Quinton’s theory is that it precipitated out of water a long time ago.
- Given that Quinton has had one of the “wackiest” or most “unconventional” theories around regarding how so much gold ended up in the Witswatersrand Basin and that the same theory led him to Pilbara, I would suggest that this is not by pure accident that Quinton now happens to be involved in the most unique gold “freak show” in a long time.
- John Kaiser’s latest presentation at MIF.
- Brent Cook discusses Novo in Beaver Creek.
- Not a paleoplacer
- 2.7 billion years old gold
- Not eroded from an ore body
- Thickness vary from almost nothing to 20 m (Thus the diamond drill results should vary A LOT)
- Beaton’s Creek is more similar to Witswatersrand than Karratha is
The bullet points above are factors I use to try to “read between the lines”, or in other words, use as input that either makes me subjectively more bullish or bearish in terms of perceived chance for success. Some are 100% based on facts (like SEDI buy and sell activity) and some are based on nothing more than “hearsay” (and thus are judgement calls).
[I won’t state my personal interpretation. Everyone has to make up ones own mind. This should not be considered as a sell nor buy recommendation. Exploration stocks are inherently risky and at times very volatile. I own shares of Novo. I am biased]
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