Panther Metals PLC

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Time for the Panther to leap higher once again?

 

“…as the markets have noted, Panther has been able to maintain that positive trajectory, the company’s share price continuing its steady climb, up from 2p last March to around 13p today…”

 

Amidst the pandemic and volatile gold prices, gold and base metals miner Panther Metals (LON:PALM), one of the most popular small cap mining stocks over the past year, has continued to issue positive updates on its exploration of its Western Australia and Canada assets.

Panther moved from the NEX Exchange (since renamed the Aquis Stock Exchange) to the LSE Main Market last January, raising £823,000 to fund exploration of gold and base metals prospects in Canada and Western Australia.

The Big Bear Gold Project in north-western Ontario, when acquired in early 2018, covered an area of 46 sq km encompassing three legacy sites studded with dozens of mining claims. Panther expanded the asset last July by acquiring the Dotted Lake Property, approximately 20km from Barrick Gold’s Hemlo Gold Mine, which has produced more 21 million ounces of gold over the past 30 years.

A year later the company acquired its Western Australian assets, the Marrakai and Annaburroo Gold Projects near Darwin in the Northern Territory. Marrakai, covering an area of 10.1 sq km, is near the Rustlers Roost project, one of the largest gold mines in the region. Annaburroo is a largely unexplored licence covering 149.8 sq km

Last November Panther acquired its first post-discovery opportunity in Western Australia, the Merolia Gold Project, a portfolio of nine exploration tenements covering an an area of some 435 sq km in one of Western Australia’s prolific gold producing areas, near the Granny Smith (3 Moz), Sunrise Dam (8 Moz) and Wallaby (8 Moz) gold mines.

Quiet progress

 

We noted the solid progress Panther had been able to report despite Covid-19 restrictions on fieldwork when we last covered the company in July. And as the markets have noted, Panther has been able to maintain that positive trajectory, the company’s share price continuing its steady climb, up from 3.65p last February to around 13p today.

Though the pandemic has restricted the company’s physical access to its fields, desk studies and technical analysis have clarified the opportunities they present.

High grades of gold mineralization have been identified at four potential exploration targets at Annaburroo, there may be much more to come: only 5pc of the project area has been sampled so far. An airborne magnetic survey will be flown this quarter, with a view to field programmes beginning later in the year.

In February Panther announced that soil geochemical sampling had begun at the Merolia Gold Project. More than 800 samples will taken at a planned depth of 1.5 metres to test a priority target zone south of the Project’s Ironstone and Comet Well prospects, where a technical review highlighted a gap in previous exploration coverage along a 15km strike. The programme aims to ‘fill in the gap’ to identify targets for future mineral exploration.

In Canada, Panther undertook exploration fieldwork at Big Bear last summer, soil and rock sampling, outcrop mapping, and a helicopter electromagnetic survey delineating five prospective target areas, with two of them, Cook Lake East (with a strike length of over 600m) and Big Duck Creek (striking at least 580m) designated high priorities for further groundwork.

Airborne surveys over Dotted Lake have identified 138 geophysical anomalies, which are currently being evaluated and prioritised for a future diamond drilling programme. Panther is working to ‘piece together the puzzle that is the Big Bear project’, which the company hopes will yield many more surprises: one of the highest priority target zones identified by the magnetic survey is still to be visited by the team.

Prospects for gold

 

When we reported on Panther last summer gold was just beginning the bull run that took its price above $2,000 a troy ounce, investors turning to the metal as a haven amidst the market turmoil generated by the virus.

Gold prices have dipped since then, standing at around $1,600 at the time of writing, as investors buoyed by the prospect of robust post pandemic growth have returned to equities, pushing up bond yields. And as we noted in our commentary on the commodities supercycle debate, precious metals more directly associated with industrial demand have become more attractive investments than gold.

But with the pace of recovery still uncertain, and fears of inflation engendered by the pandemic-driven loose monetary and fiscal policy governing most of the world’s economies, gold’s value is unlikely to fall too sharply. Citibank and Goldman Sachs argue that gold may rebound well about $2,000 an ounce in the next few months as investors continue to hedge, and global demand for jewellery – which fell sharply last year – picks up along with the rest of the international economy.

Big gold miners remain bullish. Barrick Gold has been reporting robust results with CEO Mark Bristow arguing that the ‘peak in gold will be higher than we’ve seen’ as governments continue to pour money into a global economy that has borne damage comparable to ‘the second world war crisis’.

Prospects for Panther

 

That might be rather an exaggeration, but persistent uncertainties about the speed and strength of the global recovery indicate that gold’s price isn’t going to fall too far. Panther, meanwhile, seems to have a clear focus on what it can control: the steady cultivation of a set of promising assets.

The company’s principal challenge, as its Board has acknowledged, is to secure continued funding for ongoing exploration. The company reported an unaudited loss for the six months ended 30 June 2020 of £388,126 (2019: £91,458) and total cash reserves of £261,786 (2019: £6,328). The company raised £300,000 very recently in December at 10p at a 3.5p premium to the raise last July.

Panther’s continually rising share price, however, indicates investor confidence. We see no reason to change our view that the company’s lively news flow is well worth following, particularly given the prospect of long awaited boots on the ground exploration later this year.

For the latest Panther Metals presentation, click here.

Panther Metals PLC was also featured in the recent @TMSreach 14 Mining Companies to follow feature at the start of the New Year.

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