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Friday, October 20, 2017 Derek Macpherson

Orford Site Visit: High Discovery Potential on a Regional Scale Land Package


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This summer we had the opportunity to visit Orford Mining Corp.’s Qiqavik gold property located in northern Quebec. Orford Mining Corp is to be formed following the completion of the amalgamation between True North Nickel Inc. and Focused Capital Corp. The company is expected to begin trading shortly. We were impressed with the level of work completed to date and believe the company is well positioned to make a discovery on its regional scale land package. As well, the company has been active during this summers field season, including 2,723m of drilling, which should provide steady news flow towards the end of the year once the company begins trading. Finally, Orford has been able to attract a strong management and technical team, which should have them well positioned to advance Qiqavik.  

 
High discovery potential in a premium jurisdiction. The Qiqavik property is located in the relatively unexplored northern Cape Smith Belt, in northern Quebec. The belt hosts similar geology as seen in Flin Flon, Ashanti Belt and Tanami Goldfields. Although remote, the +40km high grade gold and copper trend hosts a number of prospective targets, of which, the newest discoveries include Esperance and Aurora (Figure 1). Gold on the property has been found in different geologic settings, increasing the possibility of multiple discoveries on this regional scale land package. Notably, early results from Esperance suggest a gold-copper system, while Aurora’s early results suggest it’s a gold system. While it remains early days, the work-to-date highlights this discovery potential. We highlight that the pending drill results will provide us a better understanding of this potential when released later this year.


Upcoming drill results likely to demonstrate potential. While Orford, is going to be a new company, Qiqavik has benefitted from 10 years of prior work. Significant fieldwork and a small drill programs (550m, 6 holes) was completed in 2016, following up on 3 years (3.5 months of actual field work) of previous regional work completed by others, resulting in the discovery of the Esperance and Aurora zones. The company initiated a significant drill program (2,723m) during the 2017 field season to follow-up on previous work, the results of which are expected shortly. We expect these results, when released this fall to provide an early indication on this projects potential and be an important catalyst for the stock.
 
Strong management team to support project development. We noted on our site visit that moral was high at the camp with both the technical and management teams. The company is led by David Christie, President, CEO and Director, who besides his role on the buy-side as a Vice President with Goodman & Company Investment Counsel and Dundee Resources and he was recently the President and CEO of Eagle Hill Exploration, prior to its merger with Oban Mining (now Osisko Mining Corp – TSX:OSK) where he remains a director.

Pro-forma value based on pre-RTO financing points to good valuation for current stage. The most recent financing would give the company a ~C$20.5 million market cap (EV ~C$16.5) once the most recent financing is completed with the merger. Given the early stage development at Qiqavik and the company’s attractive Carolina properties, which should provide year-around news flow, we view the valuation as somewhat attractive providing room for the company’s valuation to increase, should this summer’s exploration program yield success.


Chad Williams | CEO
Derek Macpherson | VP Mining Analysis
Victoria Ellis Hayes | Associate

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Priced as of prior trading day's market close, EDT (unless otherwise noted).
All values in USD unless otherwise noted.

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Orford Mining Corp. - 1,2,3,4

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