Major Expansion Approved for Black Pine Gold Project

Liberty Gold Corp. (LGD:TSX; LGDTF:OTCQX) has announced that it has received final approval from the United States Forest Service (USFS) for an amendment to its Plan of Operations at the Black Pine Oxide Gold Project in Idaho. This significant amendment expands the permitted exploration area by 51%, increasing it to 37.3 square kilometers. With this approval, Liberty Gold can commence drilling on seven high-priority targets starting mid-June 2024. Vice President of Exploration Pete Shabestari expressed gratitude towards the USFS, highlighting the strong collaborative relationship established over the past seven years.

Field operations at Black Pine have already started, with the first reverse circulation (RC) drill rig expected to arrive in mid-June and a second rig in mid-July. The initial phase of exploration drilling, budgeted at 20,000 meters, will focus on new discoveries in the seven outlying target areas, aiming to expand the current resource base, which already exceeds three million ounces.

Additionally, Liberty Gold has increased its land holdings at Black Pine by staking 46 unpatented mining claims in the southwest of the project area. These new claims, covering 3.3 square kilometers, are contiguous with the existing project area and include the projected southern extension of the prospective middle plate host rock carbonate sequence, identified through field and structural mapping and soil geochemistry. This expansion brings the total project area to 69.3 square kilometers.

Why Gold?

The gold market has experienced a robust performance in 2024, driven by a confluence of economic factors and investor sentiment, as reported by MarketBeat.

Gold prices have surged to new all-time highs, reaching approximately $2,300 per ounce, marking an 11% increase year-to-date and a 16% gain over the past 12 months. This remarkable rally has been supported by a combination of a strong U.S. economy and lagging growth in other developed economies, such as Germany, Japan, and the United Kingdom. As these countries face economic challenges, investors have increasingly turned to gold as a safe haven.

Ventum Capital has the company listed as "Buy" in a June 11 research note, writing, "Liberty Gold's permitted exploration area has increased by 51% to 37.3 km2 following the approval for an amendment. 

The Federal Reserve's anticipated interest rate cuts are another key driver for gold's appreciation. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making it more attractive to investors.

Stephen Jury, managing director at J.P. Morgan Private Bank, highlighted the impact of geopolitical tensions and upcoming global elections on central bank demand for gold, suggesting that these factors will continue to support gold prices. "In our opinion, this should set the stage for gold appreciation," Jury noted

Additionally, the World Gold Council underscores the diverse demand for gold across various sectors, including jewelry, technology, and central bank reserves. This diversity helps stabilize the gold market, making it a reliable investment asset. The council also emphasizes that gold's role as a store of value during times of economic and geopolitical uncertainty continues to attract investors​.

Catalysts

The approval of the Plan of Operations amendment by the USFS marks a significant catalyst for Liberty Gold's exploration activities at Black Pine. This approval allows the company to explore seven new target areas where the prospective gold host-rock carbonate sequence is known to occur at shallow depths. Pete Shabestari noted in the company news release, "With this new approval, we can now turn the exploration drill rigs towards gold discovery in these highly prospective target areas," reflecting the company's readiness to advance its exploration efforts.

Another catalyst is the commencement of field operations, with drilling set to begin in mid-June 2024. The first phase of exploration drilling, covering 20,000 meters, aims to grow the current resource base significantly. The addition of a second drill rig in mid-July will further accelerate these efforts.

Moreover, Liberty Gold's strategic expansion of its land holdings, including the staking of 46 unpatented mining claims, increases the potential for new discoveries and enhances the project's overall value. The appointment of Matthew Zietlow as Director of Regulatory Affairs and Sustainability is also a crucial development. Zietlow's extensive experience in mine permitting and operational compliance will facilitate the submission of the Mine Plan of Operations by Q4 2024, ensuring that Liberty Gold is well-positioned to advance the Black Pine project toward production.

These catalysts collectively underscore Liberty Gold's commitment to responsible and sustainable mining practices while positioning the company for significant growth and value creation in the coming months.

Expert Opinions

Ventum Capital has the company listed as "Buy" in a June 11 research note, writing, "Liberty Gold's permitted exploration area has increased by 51% to 37.3 km2 following the approval for an amendment. The expanded exploration permit allows the company to explore at least seven new targets that have been identified where the gold-bearing carbonate sequence is known to occur at shallow depths. Drilling of the new target areas is set to commence this month, and considering Liberty Gold's track record of discovering new ounces at Black Pine, we expect defined resources to grow as gaps within the current resource are filled in and boundaries of the resource limits are extended."

Experts in the financial and mining sectors have expressed positive sentiments about Liberty Gold Corp. overall, highlighting the company's potential for significant growth and value creation. Ventum Capital Markets, in a report dated May 28, 2024, emphasized the company's strong financial upside.

"Over the long term, we continue to view Liberty Gold Corp. as one of the companies with the most financial upside to higher metal prices. Flexing our metal price forecasts by 10% for all producers and developers under coverage, net asset value per share growth for the company stands to benefit the most from a further rally in metal prices."

Jordan Roy-Byrne from The Daily Gold, on May 26, 2024, noted the positive movement of Liberty Gold's stock, driven by the company's key projects. "Liberty Gold Corp.'s stock is a good value and starting to move . . . the company's Black Pine project will regain favor as gold climbs." This optimistic outlook aligns with the recent developments at Black Pine, where expanded exploration activities are set to commence.

Brian Quast of BMO Capital Markets highlighted the strategic financial moves by Liberty Gold in his April 29, 2024, analysis. "Liberty Gold Corp. announced a CA$9.5M nonbrokered, private placement that will close on or about May 17, 2024 . . . we view this transaction as positive as this will allow the company to continue to explore and develop the Great Basin." This private placement is expected to bolster Liberty Gold's financial position, enabling ongoing and future exploration initiatives. 

Further reinforcing this positive sentiment, Alex Terentiew from PI Financial, in a report from April 18, 2024, discussed the beneficial impact of the company's recent asset sale. "Liberty Gold Corp. announced the signing of a definitive agreement to sell its 72.1% interest in the company holding the TV Tower project . . . the transaction is expected to generate gross proceeds of $8.3M in cash to Liberty Gold. We view the sale of TV Tower as a positive development for the company as it will provide the cash required for advancing Black Pine and Goldstrike without excessive shareholder dilution."

This strategic sale not only strengthens Liberty Gold's cash position but also supports its core projects, ensuring sustainable growth and development.

Ownership and Share Structure

According to Reuters, 4.94% of the company is with management and insiders. CEO and Director Cal Everett is the largest shareholder in this category at 2.60%, with 9.91 million shares.

29.88% is with institutional investors. Van Eck Associates Corp. has 14.68%, with 55.89 million shares. Franklin Advisors Inc. has 7.07%, with 26.93 million. Merk Investments LLC has 3.28%, with 12.48 million. Amati Global Investors Ltd. has 2.28%, with 8.67 million, and Konwave AG has 1.24%, with 4.72 million. 

The rest is with retail investors.

Its market cap is approximately CA$117.33 million, with about 380.8 million shares outstanding. The company trades in a 52-week range from CA$0.24 to CA$0.33​.

Important Disclosures:

1. Liberty Gold Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. 
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