This year is set to be a rough one for most junior explorers but the likely shake-out offers the opportunity to pick up some quality plays on the cheap.
That's the view of Brent Cook, a veteran geologist and mining stock analyst.
"I think it highly unlikely we will see a rush of dumb money back into this sector for quite some time - meaning, up to a third of the Venture-listed explorers go away. The upshot is that this will be a rough year for most junior speculators but one of the best times for serious investors to purchase quality mineral properties and management teams at a discount," Cook asserts.
One such company is Lydian International (TSE:LYD), the Toronto-listed company that earlier this week unveiled a new resource estimate for its Amulsar gold project in Armenia, outlining resources of 4.3mln ounces in all categories.
"The Amulsar gold deposit in Armenia is one of the best, high-margin, relatively low-capex deposits in the world. A feasibility study based on the previous resource estimate came in at about NPV 5 per cent US$1-billion. The stock is being valued at about US$200-million," Cook notes.
The company said the mineralisation remains open, with the possibility to find additional gold resources, particularly towards the north, east and to depth at Erato, Tigranes and Artavasdes, whereas Arshak remains open along strike towards the south-east.
A further resource update based on additional drilling throughout 2013 is scheduled for release in the first quarter of 2014.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.