The current junior resource bear market has been brutal yet many of the prospect generators have done quite well. SmallCapPower has shortlisted nine such Canada-listed companies that have stood out among the rest.
The junior resource bear market of the last few years can be summed up in just one word: brutal. That doesn’t mean all exploration stocks have performed poorly though. Our friends at VisualCapitalist.com have produced an infographic (view it here) illustrating why project generators may be the better option for those interested in resource juniors, as the share prices of these companies as a group are up 121%during the past five years while other listed juniors are down 55% according to its website.
Prospect Generators increase their chances of a resource discovery by simultaneously advancing multiple projects using funds from joint-venture partners. These companies offer the benefits of reduced risk, greater discovery opportunities, and less shareholder dilution, among other factors, compared with other types of resource explorers.
The following companies have been selected from a list from ProspectGenerators.org and may not include all such publicly-traded firms employing this business model today. All two-year cumulative returns were calculated based on the February 24, 2015 closing prices.
9. Altius Minerals Corporation (TSX: ALS) +1.4%
Altius is a more senior player in this business with royalty interests in 12 producing mines in Canada, including the Voisey’s Bay mine in Labrador. In 2013, the company generated approximately $31 million in royalties revenue. Altius also has a portfolio of exploration projects and recently cashed in its stake in Virginia Mines for $41 million.
8. Columbus Gold Corporation (TSXV: CGT) +38%
Columbus Gold has a gold exploration portfolio in Nevada as well as a 4.3 million ounce gold deposit in French Guiana. The company’s CEO, Robert Giustra, is the cousin of mining finance magnate Frank Giustra.
7. Golden Valley Mines Ltd. (TSXV: GZZ) +45%
Golden Valley holds multiple property interests in gold, base-metal and energy mineral projects in Québec, Ontario, and Saskatchewan. Its 56% owned subsidiary Abitibi Royalties recently entered into a letter of intent tosell its 30% free carried interest in the Malartic CHL project in Quebec in exchange for shares of Yamana and Agnico Eagle and a 3% royalty from net smelter returns on the Project.
6. Virginia Mines Inc. (TSX: VGQ) +52%
Virginia was acquired by Osisko Gold Royalties Ltd. for $479 million, or $14.19 per share, and its stock ceased trading on February 18, 2015.
5. Transition Metals Corp (TSXV: XTM) +57%
Transition Metals has 30 early stage precious and base-metal properties encompassing roughly 2,000 km2 of claims throughout Canada. The company has just 32.7 million shares outstanding.
4. Reservoir Minerals Inc. (TSXV: RMC) +89%
Reservoir has a portfolio of precious and base metal exploration properties in Europe and Africa. The company currently has about 47.8 million shares outstanding and $42 million in cash.
3. Avrupa Minerals Ltd. (TSXV: AVU) +90%
Avrupa has a portfolio of exploration projects throughout Europe including Portugal, Kosovo, and Germany. The company has approximately 44.6 million shares outstanding.
2. Constantine Metal Resources Ltd. (TSXV: CEM) +146%
Constantine’s principal asset is the Palmer copper-zinc-silver-gold VMS Project in Alaska, but it also has a pipeline of gold projects in the Timmins camp of Ontario as well as the Yukon. Insiders have about a 27% ownership stake in the company.
1. Cornerstone Capital Resources Inc. (TSXV: CGP) +220%
Cornerstone Capital has a portfolio of exploration projects in Ecuador and Chile. Early drill results from Cornerstone’s joint ventured Cascabel discovery in Ecuador are supportive of a large gold-enriched porphyry copper occurrence. The company’s 190 million shares outstanding are a concern though.
