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Posted: Jan 10, 2025	JK: Kaiser Watch January 10, 2025 with Jim Goddard and John Kaiser
Published: Jan 10, 2025	KRO: Kaiser Watch January 10, 2025: The KRO 2025 Favorites Collection Part 2
Kaiser Watch Archive Kaiser Watch is a weekly audio show produced by KaiserResearch.com with Jim Goddard and John Kaiser discussing the junior resource sector. The show has two parts: the first is a general topic and the second discusses developments involving specific companies which generally are members of the Favorites Collection but can include members of the Bottom-Fish Collection. Effective January 1, 2025 KRO hosted comments associated with Kaiser Watch will be restricted to KRO Individual and PRO Memberships though the audio version will continue to be available free via YouTube. The KRO Individual Membership at USD $450 per calendar year will no longer be available after March 31, 2025 though all members as of December 31, 2025 will be grandfathered to renew at the $450 rate. The PRO Membership will be USD $200 per month auto renewal or $2,000 non-refundable for 12 months. Sign up here for this time limited $450 offer. Kaiser Watch is available at Kaiser Research YouTube and as a Podcast downloadable from KaiserResearch.com. Once the 3 parts introducing the KRO 2025 Favorites Collection are done the General and Specific Kaiser Watch comments will be posted to Kaiser Watch Substack with the General comments unrestricted and the company Specific comments accessible through a $10 per month Substack subscription. Podcast Download Kaiser Watch January 10, 2025: The KRO 2025 Favorites Collection Part 2 Jim (0:00:00): How has the new year greeted the KRO 2025 Favorites Index? The KRO 2025 Favorites Index was up 4.4% as of January 10, 2025 which is largely due to PJX Resources Inc bouncing back from the year end round of tax loss and flow-through fund selling which is now no longer a lid on the stock. In today's Part 2 of the KRO 2025 Favorites introduction I explain why PJX is undergoing a January Effect bounce. Apart from the odd resource junior 2025 has had a lame start despite gold trying to claw its way back above $2,700. Gold peaked at $2,742.55 on November 5, 2024 but began a retreat once it became clear that Donald Trump and his entourage of merry pranksters would control all branches of the US government in 2025. Gold bottomed at $2,592.45 on December 19 but developed an uptrend when the new year began. None of this is reflected in the trading activity of TSXV resource listings whose daily traded value remains below the levels of the September-October period when the market was starting to believe the gold uptrend had staying power. There is no sign of new capital flowing into the resource juniors as happens in years when the January Effect manifests itself. Another sign of the market's unwillingness to embrace the resource sector is that the share of total traded value by TSXV resource listings, which ranged 50%-80% for most of 2024 reversed after the election and since then it has been non-resource TSXV listings which have dominated 50%-70% of traded value. The main driver of this shift has been Bitcoin's ascent through the $100,000 level as investors celebrated Trump's promise to make America the crypto capital of the world. Trump's promise to emasculate the SEC has Wall Street rubbing its hands as it contemplates raiding America's pension plans by loading them up with crypto products and units of its illiquid private equity investments. There is great uncertainty as to what exactly Trump will do after his inauguration on January 20 which may explain the market's caution toward resource sector equities. A major concern is that his tariff policy will push the global economy into a downturn which will not be helpful for metal prices. China's economy has failed to develop an uptick in domestic consumption to offset the malaise in the real estate sector, leaving China dependent on its export markets. It was troubling to see prices for Australian thermal coal and iron ore dip lower this week, a sign that a further slowdown in the Chinese economy is anticipated. The unintended longer term consequence of a harsh anti-China tariff policy by the United States will be that it will force China to get serious about boosting domestic consumption and make its overall economy less dependent on exports. Another concern is the growing tension between the ambitions of Emperor Musk and President Trump. Emperor Musk's interference in the politics of Germany and Great Britain comes across like an indirect rebuke of Trump. Who is actually in charge, the self-appointed philosopher-king or the nowhere near as wealthy elected president? The tech sector's hunger for H-1B visas issued mainly to workers from India does not sit well with the MAGA movement whose proud boys have no interest in doing the jobs done by undocumented immigrants but might be interested in the sort of jobs handed to H-1B visa holders. The argument that Americans in general are too stupid to fully feed the tech sector's worker needs is insulting and can be countered by the accusation that the tech sector gets away with paying a lot less to H-1B workers because they lack job mobility thanks to their visa status. The general equity market whose stellar performance during the past two years has been driven mainly by the Magnificent Seven is vulnerable to a rupture between Trump and the tech sector. The push for free speech absolutism so that "Hate Makes Great" based messaging is not censored may backfire because only a minority of the people who voted for Trump need to hate in order to sustain self-esteem; the vast majority are actually decent people. Although this time around I do not think resource stocks would be roadkill if a major general equity market retreat happens as was the case in 2008, the widespread conviction about the invincibility of America's stock market perversely spawns a contrarian caution with regard to the resource sector. And so far there is no sign that anybody within the incoming Trump administration appreciates how vulnerable the United States, and for that matter the entire Global West, is to a disruption of raw material supply from the Global East. There may be an inkling of this in Trump's bluster about turning Canada into the 51st state which at the moment is just him trolling Canadians as losers. Canadians, however, should take this threat seriously because the real reason the United States might find it necessary to annex Canada is not because it needs more "Lebensraum" as Germany's Hitler claimed, but because it needs a ramped up supply of minerals and minerals from a secure jurisdiction if its conflict with the Global East spins out of control. The decision by Prime Minister Justin Trudeau to make Canada a signatory of UNDRIP and elevate First Nations into a race based aristocracy with a final say on what happens to Canada's natural resource potential has turned Canada into an underachiever in terms of resource exploration and development, which is evident in the sorry state of its junior resource sector that has to deal with misaligned funding, permitting and seasonal cycles exacerbated by the new "consultation" role of First Nations groups. When the raw material supply problem becomes critical for the United States, and it sees that Canada has done nothing to boost mining even as its manufacturing sector is being decimated by Trump's America First tariff policies, annexing Canada and ripping up UNDRIP in the name of national security may be an easy sell for Americans. Trudeau's resignation is an important step, but Canadians need to realize that unless they want to end up a conquered people they need to revive its natural resources economy. And Canada's First Nations need to be careful that they do not forfeit their gains by overplaying their hand. The is room for productive collaboration that preserves Canada's independence and its integrity. KRO 2025 Favorites Index KRO 2025 Favorites Collection Relationship between Trade Value of TSXV Resource and Non-Resource Listings Long Term Chart of Gold Price Short Term Charts of Thermal Coal and Iron Ore Prices Is the market correct that another magnificent year awaits general equity markets? Jim (0:13:37): Why have you put P2 Gold Inc back into your Favorites Collection? P2 Gold Inc, which was a KRO Favorite in 2021 and 2022, was made a Bottom-Fish Spec Value rated 2025 Favorite because the junior has pretty much eliminated risk that it might default on the Gabbs copper-gold project optioned 100% from Waterton in 2021 and which now serves as the primary focus for Joe Ovsenek and Ken McNaughton. Joe as the financial and Ken as the geological brains were the drivers behind Pretium Resources Inc and its high grade Brucejack gold deposit in the Golden Triangle that was spun out from SSR Mining. When they left Pretium in early 2020 they acquired control of a shell through which they began optioning exploration plays in northern British Columbia. The name "P2" signaled their ambition to turn their new venture into Pretium 2 just as Clive Johnson did with B2 Gold. In early 2021 they optioned the Gabbs project from Waterton on fairly expensive terms. After the endless resource junior bear market began in 2011 Waterton acquired many projects that had been advanced by juniors during the China Super Cycle bull market from 2003-2011. Gabbs is located in Nevada's Walker Lane and hosts four deposits related to a porphyry system. The project was marginal at prevailing copper and gold prices, but Joe and Ken saw potential to develop a better flowsheet and expand the existing resource while counting on stronger gold and copper prices to drag Gabbs well into the money. The market welcomed them as heroes, which should have been cemented when Newcrest paid $3.6 billion in stock and cash in April 2022 to acquire Pretium and in turn was later acquired by Newmont. But oddly, that was about the time the market went cold on P2 Gold. When the junior went to raise money, the market balked, prompting Joe and Ken to dig into their own pockets to put up over 75% of the financing. The Golden Triangle properties had not delivered major discovery results and expensive option payments were looming. While Gabbs has some deep discovery exploration potential, work had focused on upgrading the resource estimate, sorting out the metallurgy, and delivering PEA level economic studies. But Gabbs also had escalating option payments. The Pretium heroes found themselves now being treated as zeroes shunned by Bay Street, a predicament not that different for most of the junior resource sector. During the past two years the company has dropped or sold all its British Columbia projects and renegotiated the Gabbs option terms to stave off default. Waterton, renowned for its hardball strategy, agreed to renegotiate and is now a 17% stakeholder in P2 Gold compared to management's 22% stake. Management, shocked by the funding drought, flirted with capitulation in June 2024 when it agreed to merge with Eskay Mining Corp on punitive terms for P2 Gold shareholders, but backed out when it became apparent that Eskay Mining itself had become impotent at financing. The latest Gabbs PEA update was delivered in May 2024. It envisioned a 15 year open pit mine of which the first 5 years would involve heap leaching the gold rich oxide cap after which the operation would transition to milling the copper rich sulphide ore at 14,000 tpd. The mine would yield 1,472,000 ounces gold and 419 million lbs of copper over its life. CapEx was USD $366 million with cash flow from the heap leach operation funding the future mill capital cost. The market sneered at these numbers. Copper had started the year strongly with a $4.50-$5.00/lb price range, which enabled management to use $4.50/lb copper as a base price while using $1,950 for gold. That delivered an after-tax IRR of 21.0% and an NPV ranging from USD $257 million at 10% discount rate to $550 million at 5%. The PEA provided a "low case" which used $4.00/lb copper and yielded an IRR of 14.4% and an NPV range of $105-$327 million. Unfortunately the price of copper has retreated to the $4/lb level and the market is unwilling to take the current $2,600-$2,700 gold price range seriously for the discounted cash flow model. The market consigned P2 Gold to a $0.05-$0.10 range because it deems Gabbs permanently worthless, does not like the optics of the balance sheet even though most of the liabilities are owed to insiders with a major investment in the company, and seems to assume a bleak future for real copper and gold prices. P2 Gold Inc was made a 2025 Favorite, albeit Bottom-Fish Spec Value rated, because the valuation allows enormous upside if the market's pessimism proves unfounded. Trump's policies are more likely to accelerate than decelerate the conflict between Global West and East which would have two consequences. One is even greater demand for gold ownership by the rest of the world, possibly driving gold through $3,000 in 2025 which Wall Street thinks is the optimistic upside limit for gold while viewing the sky as the limit for Bitcoin. The other is the reality that the Global West, and in particular the United States, has a dangerous import reliance on metals produced by the Global East and its friends in the Global South. The United States is a decent copper producer and has lots of copper development potential if its economy suffered an import supply drop. In the case of copper, although the United States under Trump appears poised to ignore energy transition goals by discouraging EV adoption, China already sells more new EV than ICE cars and will by the end of the decade have zero ICE car sales. Furthermore, the soaring electricity demands of AI data centers and air conditioning needs caused by rising global temperatures (2024 achieved the 1.5 degree celsius gain from pre-industrial time to which energy transition goals hoped to limit global warming) will boost copper demand. Meanwhile as we wait for copper and gold prices to break out, P2 Gold management will continue to work on securing better metallurgical recoveries and doing the environmental baseline work needed to support a plan of operations that will allow it to begin a feasibility study. Once metal prices are in a sustained uptrend the market will first rush into juniors run by zeroes who were once heroes. P2 Gold Inc (PGLD-V) Favorite Bottom-Fish Spec Value Gabbs United States - Nevada 4-Infill & Metallurgy Au Cu P2 Gold Inc as a proxy for gold and copper upside potential Jim (0:20:52): Why have you continued Patriot Battery Metals Corp as a Favorite but none of the other lithium focused 2024 Favorites? Patriot Battery Metals Corp was continued as a Fair Spec Value rated Favorite in 2025 because its Shaakichiuwaanaan (Corvette) project in the James Bay region of Quebec is a world class lithium deposit which is now moving towards a feasibility study. The CV5 pegmatite deposit at 109 million tonnes of 1.46% Li2O is the biggest and richest so far found in North America. Its location within a 50 km trend that has multiple spodumene showings may ultimately yield a resource double the current size. That still would not put it in the league of giants like Greenbushes in Australia and Manono in Congo, but if EV adoption relying on a lithium ion battery continues to replace ICE cars, the IEA predicts that the world will need a six-fold expansion of lithium supply by 2030 if net zero emission goals are to remain on track. This demand prediction assumes that a solid state LiB will never be commercialized, but there is a race underway to develop a solid state LiB which really is needed to make large scale consumer EV adoption in the Global West a reality. If that should happen the use of lithium in the anode instead of graphite will boost future demand to more than 10 times current supply. The other 2024 lithium Favorites, Brunswick Exploration Inc and Winsome Resources Ltd, were dropped because in the case of Brunswick, the junior does not yet have evidence of a world class discovery though that may yet happen at Mirage if they can find the source of the lithium enriched boulder field, and, in the case of Winsome, the 1% grade of its Adina deposit is even less in the money than the CV5 deposit of PMET at current lithium prices. The first lithium boom took place in 2015-2018 when lithium carbonate prices ranged $10-$15/lb and there was a lot of hype about the growing EV sector. The Australians were so successful at mobilizing domestic pegmatite sourced supply that it overshot demand growth from the EV sector. As a result a lithium winter reigned from 2018-2020 when the price of lithium carbonate plunged below $3/lb where most pegmatite mines lose money. When Trump was defeated by Biden at the end of 2020 it became apparent that the world's carmakers and in particular China had ignored Trump's dismissal of climate change as a hoax. Stalled supply development during the lithium winter created a shortfall which sent lithium carbonate prices into the $30-$35/lb range which is unsustainable because far too many LCT-type pegmatites are in the money at that price. The high prices resulted in renewed mobilization of lithium supply which once again overshot demand when Global West consumer interest in EV cars stalled. While liberal minded economic elites were happy to buy a Tesla, the ordinary consumer wanted an affordable EV with the same range and "charging" time as Toyota's top selling Camry and Corolla ICE models. China meanwhile had developed much cheaper models that were "good enough" at the price, but its effort to export BYD's EVs to the Global West was blocked because this would destroy the EV future of Global West carmakers. The result is that in early 2023 the price of lithium carbonate began to crash and by the end of 2024 it was stuck below $5/lb where only the richest pegmatites such as Greenbushes make money. The antipathy of the Republican Party toward electric vehicles suggests that the new lithium winter will last until solid state lithium batteries become commercial reality at an affordable price, and that is unlikely to happen before 2027. The reason PMET is trading at a fraction of the $15.29 price at which Albemarle injected $109 million in August 2023 is that the PEA it published one year later in August 2024 shows that CV5 needs a lithium price double the current spot price to be worth developing. The PEA indicated an after-tax IRR of 34% and NPV at 8% discount rate of USD $2,232,000,000 for a mining scenario that would eventually process 5 million tonnes of ore annually (about 14,000 tpd) to produce a spodumene concentrate. That NPV at the current exchange rate and 152 million shares fully diluted translates into a future stock price of CAD $21 per share. Unfortunately, that economic outcome relied on a base case price of USD $1,375/tonne 5.5% spodumene concentrate compared to the current lithium winter price of $840/t which is 61% of the base case price. With CapEx at USD $761 million if this were the long term price CV5 would never be developed. The reason PMET chose $1,375/t was because that is the level where long term forecasts peg the price of spodumene concentrate, which in lithium carbonate terms would be double the spot price. Unless there is a miracle in DLE technology applied to oilfield brines that allows unlimited lithium supply to be profitably mobilized below $5/lb, the projected lithium demand for 2030 will never be met with supply. Realistically the future price of lithium carbonate needs to stabilize in the $10-$15/lb range. The market, however, has no experience with the pace and scale at which demand for an obscure metal whose market in 2005 was worth only USD $200 million has soared thanks to new technology. It takes the lithium spot price as the basis for valuing a lithium junior such as PMET. In terms of lithium exploration juniors this second lithium winter has created a serious bear market. But if solid state LiB powered electric vehicles end up replacing internal combustion engine cars, the value of the annual lithium supply market will range $100-$200 billion during 2030-2040 at a modest price gain into the $10-$15/lb lithium carbonate range. Major mining companies such as BHP, Anglo American and Glencore do not think this will ever happen, but Rio Tinto does think so. In early October 2024 Arcadium Lithium agreed to be acquired by Rio Tinto in a cash transaction that values Arcadium at USD $6.7 billion. Rio Tinto has been interested in lithium for a long term thanks to its Jadar high grade claystone style deposit in Serbia whose development has been blocked through Russia bankrolled protests. But Rio Tinto is advancing the Rincon salar brine project in Argentina. The Arcadium acquisition which will close in mid 2025 gives it additional salar brine assets, the Mt Catlin pegmatite operation in Australia, and a major upstream and downstream footprint in Quebec. The market has failed to appreciate the importance of Rio Tinto's imminent control of the Canadian lithium supply and refining infrastructure. PMET itself received a major boost on December 18, 2024 when it agreed to a CAD $69 million financing at premium priced $4.42/share with Volkswagen which will also receive offtake rights on 25% of stage 1 production and 12.5% of stage 2 production from CV5. The price paid for 5.5% spodumene concentrate will be linked to market indices. While the price is 29% of what Albemarle paid just over a year earlier, this financing/offtake agreement comes at a time of deep pessimism about the lithium winter and the incoming Trump administration's hostility to energy transition trends which does conflict with the Tesla agenda of Trump's biggest backer. PMET was continued as a 2025 Favorite because it is a highly leveraged proxy for the future of the electric vehicle sector and a bet that Trump will figure out a way to embrace energy transition goals. Patriot Battery Metals Corp (PMET-T) Favorite Fair Spec Value Corvette Canada - Quebec 4-Infill & Metallurgy Li Patriot Battery Metals Corp is a bet that LiB powered EVs will dominate the future Jim (0:25:50): Why have you continued PJX Resources Inc as a Bottom-Fish rather than Fair Spec Value rated Favorite? PJX Resources Inc was continued as a Bottom-Fish Spec Value rated 2025 Favorite despite a disappointing finish in 2024. PJX sparked interest among Sullivan 2 hunters in October 2023 when it published news about finding boulders in the talus of a mountain slope at its Dewdney Trail project in southeastern British Columbia. These boulders had the exhalative textures of a seafloor smoker and silver-zinc-lead grades comparable to the now depleted world class Sullivan deposit. This differed from the high grade mineralization of the nearby former Estella Mine which is a stratigraphy crosscutting vein system with limited tonnage potential. Prospectors never found any bedded stratiform mineralization in the area so these boulders were quite a surprise. John Keating's crew was in the area investigating much younger intrusions for copper-gold mineralization, spurred on by anomalous copper and gold values in a soil sampling grid and a placer gold history. While they could see Proterozoic stratigraphy at the upper part of the mountain which was younger than the Sullivan Time Horizon, the lower half that attracted the crew was what appeared to be a syenite intrusion. Eventually they realized that this rock was a dyke intruded perpendicular to the older sedimentary layer cake which acted like a curtain that hid the lower half of the stratigraphy. It was hypothesized that the high grade SEDEX boulders had spilled from small erosional windows in the dyke. This talus discovery came too late in the season for follow up prospecting so PJX applied for a major modification to its Dewdney Trail drill permit. To make sure it had sufficient funds to allow a drill program when the snow cleared from the mountainside in late May, PJX did several cheap financings during the last 2 months of 2023 including with several flow-through funds. PJX was graduated from the 2024 Bottom-Fish Collection where it started at $0.09 to the 2024 Favorites Collection on April 19, 2024 at $0.28 after it raised an extra $3.6 million from a group that included Crescat and a strategic investor. Although management thought it would have a drill permit by May, the convoluted BC permitting process which requires First Nations consultations delayed the permit which was not granted until mid July with some extra required inspections. This messed with the timing of crew mobilization with the result that drilling did not begin until mid August. PJX had 2 drill platforms built, one to test outcropping SEDEX mineralization peripheral to the likely source of the boulders and the other closer to where they thought the mineralized horizon was located. In early September the first update told the market that finding the boulder source was not going to be easy and the stock started to slide. A second rig was added but it focused on drilling in the valley. By mid October the company realized that the classic SEDEX horizon was either higher up the mountain in younger stratigraphy which was obscured by rubble or located laterally to the south. Early freezing temperatures forced PJX to shut down drilling without delivering a discovery hole. The company declined to provide any graphics about what it thought was going on because it first wanted to have all the geochemistry from assays so as not to look like it was flip-flopping. The market realized that this was still a vectoring play and the stock sold down to $0.10 through a combination of tax loss selling, required flow-through fund liquidation, and shareholders disgusted by the endless bear market throwing in the towel. Once this selling pressure was gone the stock had an early rebound and the market is now waiting for PJX to reveal what it learned in 2024 and where it now thinks it needs to drill in 2025 to find the whereabouts of Sullivan Two. On the plus side the drill permit has lots of flexibility for spotting new drill holes at Dewdney Trail, the First Nations in this area are not opposed to mining, and drilling with a full season can begin as soon as ground conditions allow. PJX is a 2025 Favorite because this is the year Sullivan Two has to arrive or disappear as a phantom. PJX Resources Inc (PJX-V) Favorite Bottom-Fish Spec Value Dewdney Trail Canada - British Columbia 2-Target Drilling Zn Pb Ag PJX Resources Inc is an all or nothing world class Sullivan 2 play in 2025 Jim (0:29:56): Why have you made Silver North Resources Lid a 2025 Favorite? Silver North Resources Ltd was made a Bottom-Fish Spec Value rated 2025 Favorite because results reported on November 14, 2024 for its summer drill program at the Haldane silver project in the Keno Hill district of Yukon are very significant despite being ignored by the market. At the start of 2024 Silver North had hoped to mount a $2 million program to test new targets along the West and Main Faults as well as the emerging Bighorn target in the northwestern part of Haldane. Keno Hill style high grade silver-zinc-lead mineralization occurs within jogs of the northeast oriented faults that cut through the quartzite country rock, creating intermittent high grade lenses. This is very similar to what Alexco mined at Keno Hill to the east, now owned by Hecla. The challenge is to figure out where these jogs occur and a high grade lens or shoot is present. The simplest approach is to drill lots of decently spaced holes and when mineralization is encountered drill smaller spaced holes to delineate the lens. The idea is to build up multiple high grade zones with an inventory of 30-40 million ounces silver. The exit strategy for Silver North would be a buyout from Hecla whose Keno Hill mill is under-utilized, a problem that helped sink Alexco. The story, however, could also capture the market's imagination as a silver discovery play because Haldane has the potential to host a silver endowment similar to Keno Hill. The reason this has not been confirmed by past exploration is that the surface is much more deeply oxidized which hampers finding the jogs which host the high grade lenses. Silver North's ambitions were wrecked by the ongoing resource junior bear market which, in order to avoid hideous dilution, forced the junior to raise only enough money to fund a much smaller drill program of up to 4 holes which was done in September. That further lowered market expectations because Silver North would have to get very lucky with such a small program. Silver North hoped to leverage its program by drilling several holes designed to cut through both the West and Main Faults, plus a fourth hole in the Bighorn target to secure a better understanding of the geology in this promising new area. The West fault already has a high grade lens but past drilling on the Main had not delivered such a lens. One hole proved useless because it deviated, and the other two appear to have overshot the West fault. However, Silver North did get lucky in that these holes intersected high grade silver mineralization in the Main fault 200 m downdip and offset by 50 m from a past hole with so-so results. This even included a 1 m interval (0.73 m true width) of 2,470 g/t Ag and 9.64 g/t gold. Not only does this demonstrate that the Main fault is also fertile for high grade silver lenses that should repeat along its strike, but it gives the junior a delineation focus when it returns in July. Of course the market simply did not care that Silver North got lucky at Haldane with a minimalist drill program, so the junior will have to spend the first half of 2025 explaining the story and getting the stock price to a level where it can fund a much bigger drill program in 2025. Silver North may get some help from the Tim project in southern Yukon optioned up to 80% to Coeur Mining which spent nearly $1 million drilling a half dozen holes for which assays are still pending at the start of 2025. Tim is a carbonate replacement type system similar to the silver-zinc-lead Silvertip deposit Coeur is mining on the BC side of the border. Coeur did allow Silver North to publish a visual description of the results in early September which revealed that Tim is indeed a CRD system with a large enough footprint to become a major discovery. Tim is about geological context, not grade, so getting assays has not been a priority, and when they arrive they are unlikely to impress the market, though Silver North is eager to see what several short mineralized intervals did assay. An important milestone will be confirmation that Coeur will return with a bigger drill program in 2025 that could deliver discovery confirming results. One future issue is that while Coeur will likely vest for 51%, the 3 year window to deliver a feasibility study to vest for 80% is not realistic in Canada's permitting environment. This does contribute to an interesting dynamic for Silver North. Coeur and Hecla are rivals which vie for the attention of silver bulls. If Haldane started to reveal that there is more potential to Haldane than just as future ore feed for Hecla's adjacent Keno Hill mill, Coeur might be keen to treat Haldane as a future potential standalone silver mine, especially if work at Tim starts to reveal that it should also own 100% of Tim rather than end up in a 51:49 relationship with possibly Hecla as a partner. Silver North Resources Ltd (SNAG-V) Favorite Bottom-Fish Spec Value Haldane Canada - Yukon Territory 2-Target Drilling Ag Zn Pb Silver North Resources Ltd has potential to become a brand new Alexco Jim (0:34:43): Why is Silver Range Resources Ltd a 2025 Favorite? Silver Range Resources Ltd was made a Bottom-Fish Spec Value rated 2025 Favorite because it is the American equivalent prospect-generator-farmout junior of another 2025 Favorite, Eagle Plains Resources Ltd. Spun out a long time ago from Strategic Metals Ltd, the Yukon prospect-generator which remains a shareholder of Silver Range, under Mike Power and John Gilbert the junior has developed a focus on southwestern United States, in particular Nevada's Walker Lane, though they are expanding into Arizona. The Walker Lane received a lot of attention during the 1980s after gold had stabilized in the $350-$400 range and heap leaching became a new method to extract gold from oxidized low grade ore. The Walker Lane, unlike northeastern Nevada where Carlin-type deposits became the rage after Barrick discovered Goldstrike in the mid 1980's, is home to copper porphyry systems such as Yerington and epithermal systems which range from low sulphidation epithermal deposits created by hotspring activity to the intermediate and high sulphidation epithermal deposits associated with the periphery of porphyry systems. Bodie and Comstock are the most famous high grade epithermal deposits in the Walker Lane from the early prospecting waves that started in the mid 19th century. Until recently the perception has been that the Walker Lane's high grade epithermal potential has been exhausted and what remains are low grade open-pittable, heap leachable deposits such as Hasbrouck near Tonopah owned by West Vault Mining Ltd or Goldfield being developed by Centerra. These are seen as proxies for higher real gold prices. In recent years there has been a revival of interest in high grade gold-silver epithermal systems driven by evolving concepts such as alteration geochemistry. Prospects that previously failed to yield any joy through shallow drilling of modest outcropping mineralization are undergoing a rethink where juniors like Silver Range compile historical data and collect new information from the field through sampling and geophysical surveys. Hyperspectral Aster data is an example of new tools that identify alteration systems with large footprints as proved to be the case with the 13 million ounce Silicon-Merlin epithermal system discovered by AngloGold in southwestern Nevada. Digital technology fed multiple data sets allows unprecedented 3D visualization geologists can use to identify new targets. This is what Silver Range does differently on a much enhanced scale than available to past explorers. For a while it was able to attract farmout deals with Australian companies or private American groups. The increasing severity of the resource junior bear market has slowed down farmout activity, exacerbated by the NIMBY mentality adopted by the USFS and BLM with regard to permitting drill programs. The "deny and delay" tactics are a problem for resource juniors because although not hidden beneath barren cover rock, the type of targets developed by juniors such as Silver Range are still effectively blind. They require scout drilling to deliver geology that allows vectoring in on more focused drill targets. Silver Range is thus a proxy for the speculation that the incoming Trump administration will force the USFS and BLM to stop behaving like America's health insurance companies. Silver Range was made a Favorite partly because it is well positioned to secure farmout deals for projects such as East Goldfield if an exploration bull market returns to the junior resource sector. Another reason is that deals it did where it sold 100% of projects for a royalty and a meaningful equity stake are starting to bear fruit. Late last year one of these partners finally went public, which gave Silver Range a chance to liquidate its paper and bring its treasury to $1.7 million so it is no longer limping along as during the past year. 2025 may also be the year when Silver Range finally gets liquidity for the 10% equity stake it received in Broden Mining in exchange for its Key silver-zinc-lead deposit in the Faro District of southern Yukon. Mining stopped many decades ago and left a reclamation mess which Broden plans to fix by redevloping the Faro District in a manner that Alexco did with the Keno Hill silver-zinc-lead district in 2006. The project has stalled because Broden has been unable to get one of the First Nations groups in the area to sign off even though the Yukon government supports the Faro District redevelopment. This FN group, however, now needs approval from the government to proceed with an unrelated mining project and may cease to be so recalcitrant. 2025 may be the year when Broden gets the green light for Faro, and this would be important for Silver Range because its 10% equity stake could be worth $10-$20 million to an institutional buyer. If Silver Range gets a non-dilutive cash windfall of this scale it will be in an excellent position to include scout drilling to boost the farmout prospectivity of its projects. Silver Range Resources Ltd (SNG-V) Favorite Bottom-Fish Spec Value East Goldfield United States - Nevada 2-Target Drilling Au Silver Range Resources Ltd as a US focused epithermal gold-silver prospect generator Jim (0:42:51): Why is Sitka Gold Corp a 2025 Favorite? Sitka Gold Corp was made a Fair Spec Value rated 2025 Favorite because it was one of the few members of the 2024 Bottom-Fish Collection to graduate to Favorite status. It started 2024 at $0.20 though by summer it had sunk into the $0.10-$0.20 range despite gold's remarkable upside performance. Sitka began with 1.3 million low grade but open-pittable ounces outlined at the RC project which is located in the Yukon between Dawson City and Hecla's Keno Hill underground silver mine. This resource split between the Blackjack and Eiger zones was completed in 2022 based on 34 holes for 11,630 m. Since then Sitka has boosted the count to 72 holes for 25,136 m of which 27 holes (14,476 m) were drilled into Blackjack in 2023-24. An updated estimate in 2025 should boost the resource above 2 million ounces, and will probably not include the high grade results delivered for Blackjack in 2024 at a depth below the open-pit limit, results which launched Sitka into an uptrend in September. Sitka Gold managed to experience a just-in-time miracle during 2024. Sitka Gold was flagged as a Bottom-Fish because there was room for resource expansion, the location is good in terms of First Nations support and infrastructure, and because the combined resource of 61,105,000 tonnes at 0.68 g/t gold for 1,340,000 ounces in situ would benefit from a rising real gold price. But one sticking point was the location of the Clear Creek claim within the RC land package just to the south of the Blackjack deposit. This posed potential infrastructure related development limitations, though it was assumed that eventually Victoria Gold which operated the Eagle heap leach mine to the north would acquire Sitka Gold. But Corwin Coe bit the bullet and negotiated a deal to acquire Clear Creek from Victoria Gold that was inked on June 24. 2024. The next day disaster struck at Eagle when a heap leach pile collapsed, sending mine water into the local creek. Although there was limited evidence of fish kills the spectacular failure stirred up Yukon's First Nations and the anti-mining lobby which would have been out in full force during this time of the year when daylight merely dims at night. The Yukon government forced Victoria Gold into bankruptcy from which Sitka Gold would have had a hard time extracting the Clear Creek property. Sitka stock went down after the Eagle disaster because the market figured this was the end for mining in the Yukon, but the hand wringing eventually subsided, and Yukon appears to still be open for mining business. Sitka Gold broke out in September when it reported assays for the Blackjack zone in September which ranged in the 1-2 g/t range compared to the 0.5-1.0 g/t range historically delivered. The market's perspective on Yukon's Tombstone Gold Belt rocks had changed in 2022 when Scott Bergdahl's Snowline Gold Corp discovered the Valley intrusion related gold system at its Rogue project in eastern Yukon. The stock has attracted B2 Gold as a strategic investor and hit a $6.40 high in 2024 that implied a value in excess of $1 billion. The Valley discovery surprised the market because prior juniors such as Golden Predator had explored the area and not found anything interesting. Furthermore, the grade range of 1-2 g/t gold was much higher than other big gold systems in the Yukon. In July 2024 Snowline delivered a maiden resource estimate which came in at 157 million tonnes indicated and inferred with a grade range of 125-1.66 g/t gold for 7.3 million ounces in situ that will grow bigger. Despite gold trading over $2,700 in 2024 the major producers remain unexcited by bulk tonnage systems below 1 g/t gold, though Valley has unveiled a new and interesting potential for Yukon. The beyond open-pit limit assays for Blackjack got the market wondering if Sitka's RC project might also eventually yield grades in the 1-2 g/t range at an open pittable depth. On October 9 Sitka announced meaningful visible gold in the first hole drilled into the Rhosgobel intrusion to the south within the Clear Creek claim. On November 25 Sitka Gold reported assays which confirmed that much better grades exist beyond the 75 m vertical depth tested by Kennecott during the 1990s within what appears to be a structural corridor in the Rhosgobel intrusion. The location is much better for development than Snowline's Valley discovery whose current valuation of about $800 million makes that story a waiting game. Sitka Gold at 408 million fully diluted has a valuation of only $120 million at $0.30. It has $15 million working capital and can resume drilling by Q2 of 2025. Its valuation at 15% that of Snowline gives it lots of room to increase during 2025 and it will be the market's Yukon intrusion related gold system trading favorite in 2025. Sitka Gold Corp (SIG-V) Favorite Fair Spec Value RC Canada - Yukon Territory 4-Infill & Metallurgy Au Sitka Gold Corp is poised to become the Yukon intrusion related gold system favorite in 2025 Disclosure: JK owns shares of PJX Resources

Posted: Jan 3, 2025	JK: Kaiser Watch January 3, 2025 with Jim Goddard and John Kaiser
Published: Jan 3, 2025	KRO: Kaiser Watch January 3, 2025: The KRO 2025 Favorites Collection Part 1
Kaiser Watch Archive Kaiser Watch is a weekly audio show produced by KaiserResearch.com with Jim Goddard and John Kaiser discussing the junior resource sector. The show has two parts: the first is a general topic and the second discusses developments involving specific companies which generally are members of the Favorites Collection but can include members of the Bottom-Fish Collection. Effective January 1, 2025 KRO hosted comments associated with Kaiser Watch will be restricted to KRO Individual and PRO Memberships though the audio version will continue to be available free via YouTube. The KRO Individual Membership at USD $450 per calendar year will no longer be available after March 31, 2025 though all members as of December 31, 2025 will be grandfathered to renew at the $450 rate. The PRO Membership will be USD $200 per month auto renewal or $2,000 non-refundable for 12 months. Sign up here for this time limited $450 offer. Kaiser Watch is available at Kaiser Research YouTube and as a Podcast downloadable from KaiserResearch.com. Once the 3 parts introducing the KRO 2025 Favorites Collection are done the General and Specific Kaiser Watch comments will be posted to Kaiser Watch Substack with the General comments unrestricted and the company Specific comments accessible through a $10 per month Substack subscription. Podcast Download Kaiser Watch January 3, 2025: The KRO 2025 Favorites Collection Part 1 Jim (0:00:00): What does your 2025 KRO Favorites Collection look like? After three dismal years for the annual KRO Favorites Collection I decided to do something different for 2025. The concept during the past three years has been to feature companies that graduated from the Bottom-Fish Collection at the end of each year, and during the new year add companies from the Bottom-Fish Collection when their missing pieces fall into place and they have lifted off the bottom. Well by the end of 2024 only one bottom-fish clearly qualified to graduate to the 2025 Favorites Collection, and a number of 2024 Favorites collapsed back to Bottom-Fish status. It was also clear that the resource junior bear market that began in 2011 was only getting worse, and 2024 finished off with capitulation selling as investors threw in the towel. In my final Kaiser Watch Episode for 2024 I discussed that most of the reasons to expect the resource juniors to begin a secular bull market remain in place and have even become stronger in light of the uncertainty about the potential consequences of the incoming Trump administration's policies to Make America Great Again. We will have to see if those policies do indeed spawn a raw material supply crisis as I predict, but what one cannot deny is that there is a huge disconnect between the price of gold and the market's attitude toward gold producers. Will this resolve itself as it did in 2013 when the price of gold collapsed back to $1,100, vindicating the downtrend gold producers developed in early 2011 while gold was still ramping toward $2,000, or will we see gold ramp through $3,000 and inject life into the gold producers and ultimately the gold juniors? Working against the latter is the perception that the American senior equity market led by the Magnificent Seven is invincible and will continue to rise in 2025, with Bitcoin also achieving new highs as Wall Streets rolls up its sleeves to loot America's pension plans. In 2025 we will be walking through the looking glass into an alternative reality where many surprises may assault the world. In my view these surprises will be beneficial for gold and light a fire under the gold producers, as well as the idea that the Global West must launch a massive exploration campaign in secure jurisdictions to develop reliable raw material supply. I believe during 2025 the unloved junior resource sector will come alive and start to experience massive inflow of risk capital, accelerating as we head into 2026. I believe 2025 will be a turnaround year for the endless secular resource junior bear market. I have populated the KRO 2025 Favorites Collection with 20 diverse resource juniors, and my Bottom-Fish Collection has over 100 members that can feed the Favorites Collection as their missing pieces fall into place. The Favorites which in the past included only Fair and Good Speculative value rated juniors now include Bottom-Fish rated juniors. It is my goal to turn the Favorites into an education platform that teaches new audiences how to think about resource juniors. Kaiser Research Online at $450 per calendar year will become an exclusive club after March 31, 2025 when the new rate jumps to $200 per month or $2,000 for 12 months aimed at high net worth or corporate entities. The education platform will be presented through Kaiser Watch Substack where Kaiser Watch General comments will be available free while the Kaiser Watch Specific comments about resource junior Favorites will be available through a $10 monthly membership fee. I launched Kaiser Research three decades ago in late 1994 and at the end of 1995 I published the 1996 Bottom-Fish List through the hardcopy Kaiser Bottom-Fishing Report featuring 100 bottom-fish. The 1996 Bottom-Fish Collection was the best performing one ever. I think the 2025 Bottom-Fish Collection is vastly superior, but the audience that existed three decades ago has largely vanished. My goal is to help the resource junior sector rebuild that lost audience by targeting younger generations who may tire of mindlessly chasing momentum trends. The cheaper Kaiser Watch Substack venue will hopeful serve as the gateway for accomplishing this goal. This Episode discusses the first nine juniors in my 2025 Favorites Collection while next week's will talk about the remaining Favorites. KEO 2025 Favorites Index KRO 2025 Favorites Collection Jim (0:08:50): Why is Aclara Resources Inc a 2025 Favorite? Alcara Resources Inc is a 2025 Favorite because it is best positioned to fast track deliver a meaningful supply of non-Chinese rare earths that includes the magnet heavy rare earths dysprosium and terbium. In 2009 after the financial crisis I correctly predicted Rare Earth Mania which played out in 2009-2011 when China decided to curtail rare earth exports to the rest of the world, sending rare earth prices to the moon. Picks like Avalon, Rare Element, Quest and Tasman did extremely well, especially when Wall Street floated Molycorp to revive the mothballed Mountain Pass Mine in California. China eventually eased restrictions and rare earth prices collapsed. But in the decade since then global production has tripled thanks to demand for the magnet rare earths which are a small portion of a typical rare earth deposit. There has not been a corresponding demand boost for the more abundant rare earths such as cerium and lanthanum which has clobbered the prices of most non-magnet rare earths. This means that typically 80%-90% of a rare earth deposit's rock value resides in the magnet rare earths neodymium, praseodymium, dysprosium and terbium. Officially China supplies only 68% of global rare earth production but the number is actually 80% because the 12% mined in the United States has to be shipped to China for cracking. This is a ticking time bomb for the Global West. Aclara Resources Inc, which is backed by a member of the Hochschild family after being spun out from the mining company, is advancing the Carina deposit in Brazil. Carina is an ion adsorption clay deposit similar to those mined in China for the heavy rare earths, except that the Brazilian versions have not undergone the extra weathering that depleted the cerium in the Chinese ionic clay deposits. Carina, although lower grade than other ionic clay Brazilian deposits such as Verde Agritech's Man of War deposit, stands out because 28% of its rare earth distribution is represented by the heavy rare earths which are very low in carbonatite style deposits. Aclara has a Bottom-Fish Spec Value rating because at current spot prices development of Carina is not going to make much money. But if the geopolitical conflict between China and the United States escalates, and China once again curtails rare earth supply, the price of rare earths outside of China will go through the roof, not as crazily as it did in Rare Earth Mania 1.0, but still enough to make Aclara's Carina deposit very lucrative. So the missing piece is China expanding its critical mineral export restrictions to include rare earths. The flow-sheets for ionic clay deposits are simpler than for hardrock deposits, mining is basically strip mining the weathered clay horizon similar to laterite deposits, and Brazil is a good jurisdiction to rapidly develop a mine. What is a bonus with Aclara is that the company has formed an alliance with a Chilean conglomerate to develop magnet making capacity outside of China, a major missing piece in the United States. If China imposes rare earth export restrictions in retaliation for Trump tariffs or as a consequence of annexing Taiwan, and "export" rare earth prices soar, Aclara will be the go to proxy for the market. Aclara Resources Inc (ARA-T) Favorite Bottom-Fish Spec Value Carina Module Brazil - Other 6-Prefeasibility REM Aclara Resources Inc as a proxy for Rare Earth Mania 2.0 Jim (0:14:06): Why did you continue Arizona Gold & Silver Inc as a 2025 Favorite? Arizona Gold and Silver Inc is a 2025 Favorite because it is a gold discovery exploration junior which in 2025 is finally in a position to test a dual outcome target at its Philadelphia project in southwestern Arizona. Since acquiring Philadelphia in late 2019 the junior has been drilling off the high grade Philadelphia vein covered by the unpatented claims. This story which looked like trying to find deeper high grade vein material left behind by the old-timers lacked scale until 2022 when the junior observed decent grade disseminated gold mineralization in the hanging wall of the vein. This became the Red Hill hypothesis which speculates that the untested rhyolite flow dome of this low sulphidation epithermal system. The Red Hill target has a footprint capable of hosting a 2-5 million ounce open-pittable gold deposit at the grade observed in the hanging, in addition to the 500,000+ ounce high grade underground mineable potential of the vein itself. However, Red Hill is to the east of the Philadelphia vein and sits on BLM land. The permitting process took almost two years, resulting in approval for 2 drill pads in June 2024. While no permits were required to drill from the patented claims, the eastward dip of the Philadelphia vein limited how deep Arizona Gold could chase the vein. The two drill pads were chosen to fan holes that can chase the high grade vein down dip and test the bulk tonnage Red Hill hypothesis in the hanging wall. The triple curse that hangs over Canadian resource juniors is that permitting, funding and seasonal cycles are not synchronized. Arizona Gold's plan to start drilling in July 2024 was stymied by extremely hot weather in southern Arizona during which it would be difficult to keep drilling crew safe from heat exhaustion. Drilling did not start until October and two rigs have drilled 6 holes. These holes have intersected the vein where expected and when the assays arrive in January we will probably see decent high grade values. But what everybody is holding their breath about is confirmation that the Red Hill hypothesis is correct. Thick low grade intervals of 1-2 g/t gold in the hanging wall will be what sends the stock soaring, not the short high grade intervals. But even if all we get is vein mineralization, there is an exit strategy now in the wings. The nearby Moss Mine of bankrupt Elevation Gold Mining Corp was just acquired by producer Mako Mining Corp which will need a high grade ore feed to make the mine profitable. There does, however, remain bluesky in the eastern part of the Philadelphia project where Aster data indicates a much bigger alteration anomaly than the Red Hill target. Arizona Gold has confirmed this Philadelphia East target by securing higher resolution Aster data. The footprint of the Aster anomaly has a scale comparable to that of AngloGold's Silicon-Merlin deposit in southwestern Nevada where 13 million open pittable ounces have been outlined. Once Arizona Gold has ground truthed the targets it will have to apply to the BLM for drill permit to test Philadelphia East. Arizona Gold & Silver Inc (AZS-V) Favorite Fair Spec Value Philadelphia United States - Arizona 3-Discovery Delineation Au Ag Arizona Gold & Silver Inc as a gold exploration discovery play Jim (0:17:59): Why did you continue Canalaska Uranium Ltd as a 2025 Favorite? Canalaska Uranium Ltd is a 2025 Favorite because in 2025 it will be in a position to confirm that its high grade uranium Pike Zone discovery at West McArthur has the scale of the world class McArthur Zone 2 deposit and perhaps intersect similar "string of pearls" zones within the C10 South Corridor. Canalaska was added to the 2024 Favorites in March last year after the junior intersected the Pike zone at its West McArthur project in Saskatchewan's Athabasca Basin. The Pike Zone is a high grade unconformity associated style of mineralization similar to what makes McArthur River a world class orebody. Two drill hole lines indicate a footprint similar to McArthur Zone 2 which hosts 350 million lbs at 16% U3O8. In 2023 drilling had only intersected high grade mineralization in the basement, so the Pike Zone was a major development. It is somewhat deeper than McArthur River and requires careful directional drilling. But it is in the same geological setting and there exists the potential to delineate multiple Pike zones like a string of pearls, similar to the case of McArthur River. The challenge during 2024 was to drill small stepouts to figure out the geometry of the zone so that it could be systematically delineated. This took longer than expected, but the potential to become a $20-$30 stock on confirmation that Pike is indeed a McArthur River scale system has attracted substantial financing and Canalaska starts 2025 with $20 million in working capital. Uranium prices have sagged back to the $75/lb level from over $100/lb in 2023, so while the uranium boom is no longer celebrating the price trend, but a revival of interest in carbon free power for AI data centers is currently driving interest, coupled with concern that Kazakhstan's production capacity has plateaued. Canalaska's West McArthur is a world class discovery story and the long term outlook for uranium prices is $80 per lb and higher. Canalaska Uranium Ltd (CVV-V) Favorite Good Spec Value West McArthur Canada - Saskatchewan 3-Discovery Delineation U Canalaska Uranium Ltd as an emerging world class uranium discovery Jim (0:20:58): Why did you continue Colonial Coal International Corp as a 2025 Favorite? Colonial Coal International Corp is a 2025 Favorite because it continues to be a buyout target for east Asian steelmakers seeking a secure supply of metallurgical coal also known as coking coal. Colonial Coal was the 2024 Favorite star performer until August thanks to a decision by CitiBank take on the role of seeking a buyer for the company. The junior owns two major coal deposits in northeastern British Columbia where all the existing land is now owned by major producers. Colonial Coal completed a PEA in 2018 for the Flatbed deposit as an underground mine and in 2020 for Huguenot as a combination open pit and underground mine. Coking coal prices soared above $600 per tonne in early 2022 but have since retreated to the USD $200/tonne level which is above the $174/t base case price used for Huguenot and $160.50/t used for Flatbed which generated NPVs of USD $1,027,000,000 and $691 million respectively at a 7.5% discount rate. Since then there has been 20%-30% cost inflation which is partly offset by the higher coking coal price. The combined value is about USD $1.7 billion or about CAD $2.4 billion at 1.44:1 exchange rate which would translate into an NPV per share value of CAD $12.55 for Colonial Coal. The hoped for outcome is a bid in the $5-$10 range, possibly higher if a competitive auction broke out. Indian steelmakers who lost out a decade ago when they were early bidders for coal assets are expected to be major bidders this time around, especially given India's ambition to drive the next China style super cycle. The situation got a bit confusing in 2024 when BHP took a failed run at Anglo American which to protect itself decided to sell its coal assets in Australia and British Columbia. In addition the market waited to see if Ottawa would approve Teck's sale of its coal assets to Glencore whose plan to develop Sukunka was shot down a couple years ago on caribou impact concerns. The Teck sale has been approved and there have been changes involving Conuma Coal's holdings in the Peace River area. Colonial Coal's price slumped during Q4 of 2024 as the market backed off amid uncertainty about the outcome of the US election. That outcome is now known and the world is braced for a trade war. One global response could be for nations to retaliate against the United States with their own tariffs but start trading among each other without such tariffs. This scenario could inject new urgency into Asian steelmakers to acquire the last two major coking coal deposits left in the Peace River region not controlled by a producer. Coal mined in this region would be railed to Prince Rupert for shipping across the Pacific. While the underlying fundamental story has not changed the geopolitical context is now in flux, so I am keeping Colonial Coal as a 2025 Favorite. Colonial Coal International Corp (CAD-V) Favorite Good Spec Value Huguenot Canada - British Columbia 6-Prefeasibility CM Colonial Coal International Corp as a coking coal buyout play Jim (0:23:31): Why did you add Eagle Plains Resources Ltd to the 2025 KRO Favorites? Eagle Plains Resources Ltd is one of two prospect-generator-farmout juniors added to the 2025 Favorites Collection as bets that the secular bear market will come to an end and spur other juniors to option properties from Eagle Plains. The junior has been around for decades without a rollback and has done several spinouts. Headed by Tim Termuende and Chuck Downie Eagle Plains is a successful survivor at this game which specializes in western Canada and has a healthy treasury of about $8 million. It is cheap and Bottom-Fish Spec Value rated because during the current bear market there is limited appetite from other juniors to farm into the projects Eagle Plains generates by studying historical assessment work and being very efficient at map staking claims when they come open. And even when these juniors do option a project they have a hard time raising capital to conduct meaningful exploration. Eagle Plains is not dogmatic about the farmout model and will spend its own money on projects where its geologists believe targets represent low hanging fruit. For example the junior in 2023 spent over $1 million drilling Sullivan 2 targets at its Vulcan project and concluded that the target was elsewhere on the property. The outcome of the planned followup program remains in limbo because the junior is still waiting for new drill permits. Thanks to Prime Minister Justin Trudeau's decision to make Canada embrace UNDRIP and elevate First Nations to the status of an aristocracy with a final say on the future of exploration and development of Canada's natural resources, western Canada is plagued by a permitting regime which requires First Nations consultation which First Nations aren't always in a hurry to engage in. The Iron Range farmout has also been trapped in a First Nations caused limbo. Perhaps with Trudeau's departure and an incoming US president who may not be joking about annexing Canada as the 51st state the First Nations may shift into a more collaborative mode. The missing pieces that trap Eagle Plains with a Bottom-Fish spec value rating are the need for a resource junior bull market to emerge which enables Eagle Plains to do more farmouts that get funded, and that the attitude of First Nations shifts from obstruction to productive collaboration. The first will depend on the degree that the conflict between Global West and East intensifies and highlights the need to develop mines in secure jurisdictions. The latter could happen on a broader scale if a mandate emerges from Ottawa that UNDRIP is not a tool to make Canada a hostile acquisition target for the United States, or at a local scale where the bands in the vicinity of a project that requires exploration work decide it is in their interest to collaborate. In terms of a flagship that Eagle Plains might drill with its own dime, that currently is the George Lake project in Saskatchewan which hosts a modest SEDEX style zinc deposit that deserves a rethink. Eagle Plains Resources Ltd (EPL-V) Favorite Bottom-Fish Spec Value George Lake Canada - Saskatchewan 3-Discovery Delineation Zn Pb Ag Eagle Plains Resources Ltd as a prospect-generator-farmout proxy for the health of the resource junior sector Jim (0:27:44): Why is Endurance Gold Corp once again a Favorite? Endurance Gold Corp, despite still being rated as Bottom-Fish Spec Value, was made a 2025 Favorite because the Reliance drilling results in 2024, unacknowledged by the market, have pushed this epizonal orogenic high grade gold project in southwestern British Columbia to a tipping point where drilling in 2025, backed by $4 million in working capital, will finally force the market to recognize Reliance as a major gold discovery. Endurance optioned the Reliance project in late 2019 and during the subsequent 5 years has drilled 84 RC and 108 diamond drill holes within a 1,500 m segment of the Royal-Treasure shear corridor. Meaningful gold mineralization has been intersected in 75% of the holes, but the market has not responded because a mineable geometry is not self evident. The junior is in a position to produce an open-pittable resource estimate for the near surface mineralization, but is reluctant to do so because the gold content may not exceed the 1 million ounce threshold the market insists on. That is understandable but what the market fails to understand is that this is an orogenic system whose gold mineralization can persist over several thousand vertical metres and in this system the geochemistry indicates the surface is near the top. What the market wants to see is a deeper vein system emerge that is comparable to the 4 million ounce high grade resource that was discovered and mined at the Bralorne deposit a century ago. That means drilling ever deeper, something CEO Robert Boyd has been reluctant to do with big stepouts because it is in his conservative nature to build a system incrementally. 2023 was supposed to be the breakout year but the drilling season was curtailed by major forest fires in the district which proved to be a problem that year across much of Canada. In 2024 the major shareholder Richard Gilliam stepped up with a $4 million financing at a premium to the market which allowed Endurance to execute a major drill program which filled the "Crown" gap between the Imperial and Eagle Zones and doubled the depth at which high grade mineralization has been intersected. As a bonus hole #106, the last one reported in 2024, revealed that there is a second mineralized zone in the footwall of the Imperial Zone which past holes stopped short of testing. The market, which in the 12th year of an endless resource junior bear market only responds to barnburner drill intersections, has ignored the 2024 story building accomplishments which justify much more aggressive drilling in 2025. During the past couple years Endurance has done several 100% farm-in deals on land to the north and done target development work in an area that has never been drilled because the bedrock is obscured by ashfall from a recent Meager Creek volcanic eruption and the mountainsides are thick with unlogged forest. In late 2024 Endurance violated "just-in-time" textbook dogma by accelerating all cash and stock payments to vest 100% in the entire land package. There appear to be a half dozen structural trends parallel to the Royal-Treasure Shear corridor on the original Reliance claim, some of which have soil geochemistry anomalous with gold and the arsenic-antimony pathfinder elements. The vendors are all truly arms length, so this decision to lock up 100% now, and pre-empt future litigation when something clearly worth fighting for is visible, is a sign that management believes 2025 will be a breakout year for the Reliance project. What is missing, which explains the Bottom-Fish Spec Value rating, is market acknowledgement that Reliance is an unfolding multi-million ounce high grade gold discovery. Beyond the Reliance play Endurance also owns the Elephant Mountain project in Alaska which is an intrusion related gold system similar to Fort Knox but which has been explored in the manner of blind men grasping at parts of an elephant. The Tintina Gold Belt and its Tombstone rocks have garnered fresh market interest thanks to Snowline's Valley discovery in southeastern Yukon where previous operators grasped at the Rogue project without definitive success. At the moment the market seems to think that $2,600 gold is a mirage that soon enough will fade back to a reality below $2,000. But the gold market does not yet reflect the potential mayhem Trump may unleash if he puts his words into action. Elephant Mountain is not worth touching without a minimum $5 million exploration budget, but its potential for bulk tonnage gold mineralization in contrast to the high grade largely underground mineable potential of Reliance turns Endurance Gold into a side bet on gold blasting through $3,000 and igniting a gold based bull market for resource juniors. Endurance Gold Corp (EDG-V) Bottom-Fish Spec Value Reliance Canada - British Columbia 3-Discovery Delineation Au Endurance Gold Corp as an emerging gold discovery Jim (0:30:57): Why is Faraday Copper Corp once again a Favorite? Faraday Copper Corp made it back onto the Favorites Collection in 2025 because its Copper Creek deposit in Arizona is an advanced copper play that would benefit from a rising copper price. Faraday is well financed with $25 million working capital and is backed by heavyweights such as Murray Edwards, Pierre Lassonde and the Lundin family. The company has Bottom-Fish Spec Value rating because the PEA it published for Copper Creek in 2023 delivered numbers that do not robustly clear development hurdles at the $3.80/lb copper base case rice. Although copper surged toward $5/lb in early 2024 it had pulled back to the $4/lb level by the start of 2025. The PEA envisioned a 30,000 tpd mill initially processing open-pit mined ore until year seven when the operations starts to transition to fully underground mining by year twelve. Using a 7% discount rate the PEA indicated an after-tax NPV of USD $713 million with an IRR of 15.6% for a 32 year mine life that would produce 3.4 billion lbs of copper. The problem with these economic numbers is that CapEx came in at $798 million, 12% more than the NPV, and while the 15.6% IRR at least clears the 15% hurdle, there is not much room for error at $3.80/lb copper. Faraday Copper Corp was made a 2025 Favorite as a leveraged bet the future price of copper will be $4.50 or higher. Most future supply-demand projections present a supply deficit emerging by 2030 which will be worse if the energy transition goals are not scuttled by the Trump administration. The IEA has predicted that copper consumption related to net zero emission goals for 2050 would require a 50% supply boost above macroeconomic demand from clean energy technologies by 2030 if the 2030 energy transition targets are to be met. But just because Trump and his devotees dismiss any linkage been global warming and greenhouse gas emissions, what they cannot ignore is that climate change in the form of rising temperature will cause electricity demand for air conditioning to soar. In addition during the past couple years the AI Dream has come to dominate the technology world and most predictions are that the AI data centers will boost electricity demand. While fossil fuel cars may continue to dominate car sales in the United States, China's EV sales are already more than 50% of total sales, and while cheap Chinese EVs with short ranges may not be good enough for Global West consumers, they are good enough for Global South consumers. Electric vehicle related copper demand growth will remain a factor along with demand growth from AI and AC needs. Faraday Copper Corp is thus a bet that higher real copper prices are coming and will boost the economics of the Copper Creek mining plan. Faraday is pushing through with the permitting cycle which in the United States is a painfully slow process and continuing exploration for new zones that could scale the story bigger while we wait for the copper price to improve. Although copper is classified as a "critical mineral" because it is critical for energy transition goals, the global supply of copper is well diversified among Global West, East and South nations so it does not have criticality in terms of security of supply. North America is responsible for nearly 12% of global supply, but the GDP of the United States, Canada and Mexico is 30% of 2023 GDP. The implication is that the United States does require globalized trade to remain a reality so that it can continue to secure its needs at the market price for copper. This assumption of globalized trade could be jeopardized by how Trump deploys tariffs, as well as the conflict between Global West and East escalating. The latter may not be a problem if the Global South stays allied with the Global West, but that may not be the outcome of thuggish isolationist policies. Should the United States suddenly find itself cut off from its full copper supply need because of a geopolitical realignment of alliances, exploration for and development of domestic copper supply could become a paramount priority for the United States. Faraday thus offers upside from three story lines: 1) discovering something bigger and better at Copper Creek, 2) witnessing higher global copper prices due to demand growth from sectors like AI, AC and EVs, and, 3) domestic price shocks arising from curtailment of global copper supply. Faraday Copper Corp (FDY-T) Favorite Bottom-Fish Spec Value Copper Creek United States - Arizona 5-PEA Cu Mo Faraday Copper Corp as a proxy play on the future price of copper Jim (0:34:14): Why is FPX Nickel Corp once again a Favorite? FPX Nickel Corp is a 2025 Favorite because it is a contrarian bet that President Trump's hostility toward the concept of climate change and energy transition goals will prove to be mere flatulence dispersed by the march of reality. FPX has a Bottom-Fish Spec Value rating because at the moment nothing is working in its favor. Its flagship project in central British Columbia which it has advanced through the PFS stage since recognizing the unusual nature of the nickel mineralization at Decar, is worthless at the current nickel spot price of $6.86/lb. The 2023 PFS used $8.75/lb as a base case price which gives the project an after-tax NPV per share value ranging from $2.52 at a 10% discount rate to $10.28 at 5%. The price of nickel, however, has been clobbered by the emergence of Indonesia has a supplier of more than 50% of global nickel production. How did this happen? During the China super-cycle Chinese stainless steel producers dealt with a soaring nickel price by developing a process that allowed them to feed something called "nickel pig iron" into their stainless steel mills. NPI was created by strip mining mineralized laterite ore in Indonesia and the Philippines, shipping it as whole rock ore to China, and feeding it into legacy blast furnaces to make nickel pig iron which was good enough to meet Chinese standards for stainless steel. During the past decade Indonesia imposed a moratorium on this process which forced the Chinese to finance smelting capacity in Indonesia which worked because Indonesia has lax environmental standards and abundant coal powered electricity. So Indonesian nickel is a cheap supply of dirty nickel that is flooding the market and forcing nickel sulphide based mines operated in the Global West to shut down. Canada's WokeOlympics gold medalist prime minister was so pleased by the idea of dumping costs outside of Canada to preserve Canada as sacred territory for its First Nations that he recently struck a free trade deal with Indonesia that will flood Canada with cheap dirty nickel. None of this is good for FPX Nickel because what makes Decar stand out is that its 30 plus year mining plan has a very low carbon footprint that may even achieve zero carbon neutrality. The key is a mineral called awaruite, a nickel-iron alloy that is effectively natural stainless steel. It occurs in ultramafic ophiolite complexes that have undergone metamorphism that squeezed the nickel out of its otherwise inert silicate lattice prison and enabled it to combine with iron. The awaruite grains are magnetic and have a very high specific gravity which allows it to be extracted through grinding and magnetic separation. The concentrate can then be upgraded to a 75% ferro-nickel concentrate through flotation that, similar to nickel pig iron, can be fed directly into stainless steel mills. In addition to the resulting low per unit energy cost, the tailings are not only benign thanks to the absence of sulphide, but the nature of the magnesium gangue mineral, brucite, that occurs in this type of deposit, makes it very good at sequestering atmospheric carbon dioxide into an inert carbonate mineral. The low carbon nature of Decar's potential nickel output attracted the Finnish stainless steelmaker Outokumpu as a 9.9% strategic investor with market price based offtake rights, joining an earlier secret strategic investor that owns just under 10%. The identity of that secret investor who secured no offtake rights used to tantalize the market, but today the market simply wonders who was stupid enough to think that ESG principles would prevail over the long run? My own suspicion is that the strategic investor is the carmaker Toyota which skipped the EV race because it knew the prevailing lithium ion battery was not good enough to support mass adoption except in China where "good enough" has a much lower threshold, but which was also internally working on a cost effective solid state lithium ion battery that would be good enough to support mass adoption. Given that commercialization is still a couple years down the road it would make sense that a strategic investor like Toyota would seek to remain secret. FPX has invested money developing the flowsheet for a refinery that converts the ferro-nickel concentrate into battery grade nickel sulphate, which apparently the current configuration of Toyota's solid state LiB still requires for the cathode. This refinery subtracts from the NPV and IRR of the Decar PFS, so is something for a downstream party which needs nickel sulphate to bankroll and which it can claim as "clean". Further support for this speculation emerged when Sumitomo Metal, a real mining company focused on profits from mining, not downstream marketing advantages, also became a strategic investor just under 10%, but with the right to grow its position to 15% through open market purchases, something that has yet to happen. In addition, FPX has formed an alliance with JOGMEC, the Japanese government agency tasked with securing metal supply for Japanese conglomerates. The purpose of this alliance is to seek out other potential awaruite dominated nickel deposits in British Columbia and the rest of the world. Outokumpu and likely the secret strategic investor have a business model of selling "clean energy" products, but when Trump assumes power on January 20, 2025 they will be fighting the mantra "clean is had, dirty is good". FPX Nickel is thus a bet that the apocalyptic mind-set that personifies the MAGA movement will be short-lived, and also that the conflict between Global West and East does get hot and disrupts the flow of dirty Indonesian nickel to the Global West. Betting that the world will reject cheap dirty nickel from Indonesia is something of a hard sell in the current political climate, but FPX does have a 75% stake in CO2 Lock which it launched in 2022 to hold those projects FPX had unsuccessfully investigated as having awaruite potential but which had an abundance of the brucite magnesium mineral which is so effective at converting carbon dioxide into a carbonate mineral. Given the vocal celebration of fossil fuel combustion by the incoming Trump administration it may seem foolish to care about carbon capture. Interest in carbon capture may come from the fossil fuel sector itself. The current problem is that clean energy activists have been absolutists who want fossil fuels dumped yesterday and have no understanding what "energy transition" means. The fossil fuel producers do understand that there is a transition underway, and they need look no further than China to appreciate why electric vehicles are the future of transportation. While oil refined into diesel or gasoline may be a sunset industry, this is not so obvious for natural gas as a source of electricity. Until fusion energy becomes a commercial reality, natural gas and nuclear energy serving as baseload supply alongside renewables are the energy future. While nuclear energy is largely carbon free, natural gas is not. But its emissions from power generation, unlike the tailpipe emissions of ICE cars, occur in a single place, so carbon capture is a plausible strategy for limiting greenhouse gas emissions, something Big Oil will be eager to pursue. At some point FPX Nickel will spin out its 75% stake in CO2 Lock, which, if it has been successful in securing multiple "brucite" deposits suitable for carbon sequestration, could end up being worth far more than the nickel production capacity. FPX Nickel and its Decar project are stuck in the value trough of the Lassonde Curve defined by feasibility studies and permitting, at a time when the nickel price is below what it needs to be for Decar to be developed. But beyond a bet that demand for clean nickel priced at a premium to dirty nickel will emerge, FPX Nickel is also a proxy bet that energy transition goals will not be flushed down the toilet. FPX Nickel Corp (FPX-V) Favorite Bottom-Fish Spec Value Decar Canada - British Columbia 7-Permitting & Feasibility Ni FPX Nickel Corp as a play on clean nickel and the future of carbon capture Jim (0:39:34): Why did you add Nevada Organic Phosphate Inc to the 2025 Favorites? Nevada Organic Phosphate Inc, although Bottom-Fish Spec Value rated thanks to its weak treasury and cheap price helped out by the plodding BLM permitting cycle and obsession with sage grouse habitat, was made a 2025 Favorite because of its fascinating story, namely demonstrating the existence of a large, scalable supply of organic phosphate. The junior has spent $1 million funding studies required by the BLM to approve a phosphate lease application for its Murdock Mountain project in northeastern Nevada. Unlike metal claims where one stakes first and then applies to the BLM for drill permits, phosphate is treated like coal, oil and potash. One submits a lease application to the BLM which requires the applicant to fund a variety of environmental studies before accepting the application, which then gives the applicant two years to demonstrate that a resource exists that justifies granting title through a lease. The Murdock Mtn application covers the southern end of the Leach Mountain range where outcropping phosphate beds have been known about since the 1960s. They are at the southwestern periphery the Western Phosphate Field which straddles six states and was once an inland sea. These phosphate beds grade 3%-15% P2O5, are only 2-4 metres thick, and have never been mined because they cannot compete with the much thicker phosphate beds in Idaho that grade 25%-35% P2O5. Back in the 1960s there was not much interest in organic food, but today there is intense interest, especially in California which has nearly 40 million people and whose GDP would rank fifth among nations. The problem with the Idaho phosphate beds is that they have a heavy metal content well above the maximum limit of the Heavy Metal Index the USFDA insists all agricultural inputs must be below. These heavy metals include nasties such as uranium and thorium. The big fertilizer companies reduce the heavy metal content below the HMI limit by chemically processing the high grade phosphate to produce the MAP and DAP products. But once that is done the phosphate no longer qualifies as organic, which does not matter because it is destined for the soybean, corn and grain crops of America's breadbasket about whose organic status few care. California's agricultural crops, however, are fruit, nuts and vegetables about whose organic status it is much easier to care. The problem for organic farmers is that manure and bone-meal are the primary sources of organic phosphate whose supply cannot be scaled and which has transportation issues. The Murdock Mountain phosphate beds are unusual in that the outcrop has a heavy metal content that is 10% of the HMI maximum. It would thus be possible to mine the beds, grind up the phosphate ore, blend it to create a consistent P2O5 grade, and ship it to organic farmers as a whole rock product that can be applied directly to their fields. The grinding and bagging facility would be at Montello which is just to the east of the Leach Mountain Range and is a stop for the Union Pacific Railway which travels south through Las Vegas to end up in the Los Angeles area and counterclockwise via northern Nevada through Reno to end up in the San Francisco area. The railway would allow cheap delivery of organic phosphate to the northern and southern ends of the Central Valley. NOP finally got a green light from the BLM in mid September 2024 but final approval had to move up through six levels of a bureaucracy whose culture seems to be the deny and delay one of the health insurance sector. When final approval and request for a reclamation bond arrived in late October, it coincided with the start of a six month restricted activity period to protect nesting sage grouse. The Murdock Mtn play was started a decade ago and stalled when the entire area became part of a sage grouse study area, and then further delayed by the covid pandemic. Ironically there is little evidence of sage grouse in the Leach Mountain Range but in a range farther to the west there are so many sage grouse hunting is allowed. As one of its last demonstrations of NIMBY exceptionalism the Department of Interior declared over 30 million acres in western United States as sage grouse habitat (only 250,000 are believed to remain from a former population in the millions) in an apparent effort to sterilize this region for future mining. Nevada Organic Phosphate must overcome the following challenges. First it must raise over $1 million to fund a drilling program and the subsequent organic certification process. The second is to demonstrate that the beds are reasonably consistent and continuous to support low cost underground mining in the manner that coal seams are mined. The target that is the focus of the BLM drilling permit has a footprint of about 40 million tonnes. The third is to demonstrate that the P2O5 grade is within the expected range. The fourth is perhaps the most important milestone, namely demonstrating that the low heavy metal content in the weathered outcrop is similarly low in the down-dip fresh rock. This milestone is critical because if the Murdock Mountain phosphate beds do not qualify as "organic" they are worthless. On the plus side, because of the large scale precipitation nature of these beds in a marine setting the geochemical makeup is likely to be similar laterally over a large area. NOP has already identified multiple other locations within the Leach Mountain Range where phosphate beds appear to be present and has filed lease applications to cover what amounts to a footprint in the 100-200 million tonne range. It will not start doing the BLM studies until it has confirmed that the Murdock Mtn phosphate is certifiable as organic, but it has set itself up to have an effective monopoly on this potential source of organic phosphate. The goal of the company is to deliver proof of concept, secure the Murdock Mtn lease, and initiate the approval process for the other lease applications. If NOP is successful it will attract the buyout attention of one of the big fertilizer companies which can see a scalable supply of organic phosphate for California's agricultural sector serving the biggest market for organic food in the world. Nevada Organic Phosphate Inc (NOP-CSE) Bottom-Fish Spec Value Murdock Mtn United States - Nevada 3-Discovery Delineation P2O5 Nevada Organic Phosphate Inc as a bet on future scalable organic phoshate supply Disclosure: JK owns shares of Eagle Plains, Endurance Gold and Nevada Organic