- TSX-V: RIO.
- Shares Outstanding: 190.17M.
- Share price C$0.82 (22.12.2020).
- Market Cap: C$156.20M.
Experienced mine builder, Rio2, has made quite a bit of progress this year on their Fenix gold project in Chile. This project is the largest undeveloped gold heap leach project in the Americas.
The Fenix project is located in the Maricunga Mineral Belt in the Atacama region of Chile. The Maricunga is a well-known mining district that contains over 70Moz of gold. The Fenix project contains 5Moz of Measured & Indicated gold reserves, with an additional 1.4Moz of Inferred Gold. Resource estimates are NI 43-101 compliant and are based on data collected from 91 diamond drill holes (30,533 m of core) and 291 reverse circulation holes (84,101 m of RC cuttings). S&P Global has rated the project as one of the top 10 gold discoveries in the last 10 years. So this is already big.
Gold oxide mineralization at the Fenix project is classified as low sulphide and is contained in breccia-hosted black banded quartz veins. The gold composition is high-purity, on average >99% Au. Compared to other gold deposits, the Fenix gold mineralization is clean, with trace occurrences of copper, sulphur and mercury. The Fenix project is a pure oxide deposit with no transitional or sulphide mineralization–a unique quality in the Maricunga district. Rio2 plans to produce 100,000 oz/year of gold for the next 16 years. Analysis of the peer group operating at this level would suggest that the market cap with rise to USD$500M-$650M. But this will come down to how the finance the growth. Black says they are looking at a number of innovative proposals and will make a call on the financing route in Q1/21.
Despite the challenges from the COVID pandemic, Rio2 had a successful year. They made significant progress towards mine construction, permitting, water sourcing, financing, and networking. This year was also an important year for company alignment. Rio2 has spent the past 6 months on coaching and strengthening the management team. They’ve reinforced the company’s purpose, mission, vision, and values. This work is crucial for preparing the team to build a mine within the next 18 months.
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