Striking Gold as New Drill Results Uncover High-Grade Extensions at Cordero Mine

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As always it is important to note that investing in precious metals like silver carries risks, and market conditions can change violently with shock and awe tactics, that we have seen over the past 20 years. Before making any investment decisions, it's advisable consult with a financial advisor if needed. Also the practice of conducting thorough research and to consider your investment goals and risk tolerance.

Soma Gold Corp. (TSXV:SOMA; OTC:SMAGF; WKN:A2P4DU) has announced positive initial results from its 2024 diamond drill program targeting the "Venus Gap" at the Cordero Mine in Antioquia, Colombia. The company completed ten underground diamond drill holes totaling 1,476 meters to fill a gap in historical data north of the Venus Vein. This new phase of exploration has successfully extended the strike of the Venus Vein northwest and down dip to the northeast. It also has revealed high-grade intervals in previously underexplored areas.

Key drill intercepts include:

• 5.2 meters at 16.1 g/t gold (including 0.8 meters at 94.3 g/t gold)
• 3.3 meters at 28.3 g/t gold (including 0.5 meters at 6.3 g/t gold)
• 7.55 meters at 13.9 g/t gold (including 1.3 meters at 24.7 g/t gold and 1.45 meters at 48.6 g/t gold)

In total, drill results from the Venus Gap indicate a continuous, high-grade structure with 'bonanza' grade gold intervals. Soma Gold's VP of Exploration, Chris Buchanan, stated in the company's news release, "Extending the strike length of the Venus Vein is an important development for the Cordero Mine. Drilling in this area has returned some of the broadest, high-grade intervals in the mine. We look forward to further exploring this zone and extending it along strike and dip."

The Cordero Deposit, hosted in the El Carmen Stock, consists of quartz veins within a north-striking regional shear zone. Gold mineralization has been observed in the vein system's middle stages of vein development. It has been characterized by sphalerite, galena, and pyrite phases. Drilling identified broad intervals of lower-grade material between high-grade quartz veins, and the continuity of these stockwork zones is being assessed for potential mining inclusion.

Soma Gold's exploration team is also evaluating smaller mines along the Otú Fault, particularly in the Machuca area, where a new soil grid survey has identified three anomalies up to 900 meters in length. Additional drilling on these targets is expected to start in Q3 2024, supported by community partnerships and an ongoing ESG program in the region.

Why Gold?

On November 4, Egon von Greyerz, in a piece titled The End of the U.S. Economic and Military Empire and the Rise of Gold, predicted that gold prices would accelerate even further in the coming years. He argued that, historically, gold has consistently proven its role in wealth preservation during periods of currency devaluation, saying, "Gold stands as a protector of property rights." Greyerz underscored his belief that no fiat currency has survived over the long term and that gold remains "stable purchasing power" amid fiat currency declines.

In a November 5 report, Yahoo! Finance addressed what it called the "mysterious rally" of gold. The article noted that it had recently reached an all-time high of US$2,790 per ounce, defying traditional market indicators. Ross Norman, founder of Metals Daily, described gold's behavior as "heedless of traditional drivers" with a "massive conviction" behind the rally, leaving industry experts puzzled by the disconnect between supply levels and market behavior. The article connected the rally to the U.S. and global fiscal climate, observing that a notable move toward gold was underway among nations wary of reliance on the U.S. dollar.

Most recently, in a write-up posted on November 11, Stockhead reported that the Federal Reserve's September rate cut had initially sent gold above a record-setting US$2,500 per ounce. The report described gold's 2024 rally, up by 37% year-to-date, as supported by heightened geopolitical risk, approaching U.S. elections, and central bank buying. This combination of factors maintained a bullish sentiment for gold and continued to drive market interest into the fourth quarter of 2024.

Company Catalysts

According to Soma Gold's corporate presentation from August 2024, the company is actively expanding its operational capacity and exploration footprint in Colombia. A key catalyst is the projected increase in mill throughput at Cordero Mine to 500-550 tons per day (TPD) by Q4 2024 and ultimately up to 1,400 TPD by 2028, depending on resource expansion. With an annual drilling target of 20,000 meters in 2024, Soma aims to add approximately 100,000 ounces to its resource base and potentially increase total resources beyond 500,000 ounces by the end of 2027.

The Venus Gap's high-grade gold intercepts could significantly contribute to Soma's goal of producing 85,000 ounces annually by 2028. Additionally, Soma's commitment to formalizing small miners in the area is expected to generate 50-100 TPD of high-grade ore, enhancing the mine's overall output while integrating ESG objectives.

Third-Party Expert Analysis

*On September 7, John Newell of John Newell & Associates highlighted Soma Gold Corp.'s value in the junior gold market. He described the company as presenting a "unique value proposition" through its dual role as a gold producer and exploration company. Newell emphasized Soma's strong positioning with 100% ownership of the El Bagre mine in Colombia, which he noted generated "consistent cash flow" due to its high-grade production and robust infrastructure. He pointed out that the Aurora Mine's planned production in Q3 2024 would further bolster Soma's profile, offering "near-term revenue growth potential" due to recent funding through an amended offtake agreement.

Newell also commented on Soma Gold's extensive exploration assets, describing the company as "heavily invested in exploration" in "historically productive gold regions." He stated that Soma's holdings along the Otú Fault, a significant geological structure known for high-grade mineralization, provided a compelling exploration upside. In Brazil, Newell highlighted the company's Tucuma Copper-Gold Project in Carajás province as adding diversification and additional exploration potential to Soma's portfolio. 

Newell ultimately rated Soma Gold as a "Buy," expressing confidence in the company's potential for growth as both a stable producer and a promising exploration player in the junior gold market.

Ownership and Share Structure

Headquartered in Vancouver, B.C., Soma Gold Corp. has a market cap of US$40.19 million and trades in a 52-week range of CA$0.30 and CA$0.74. As of December  31, 2023, it had CA$1.8 million in the bank, with a monthly exploration budget of CA$330,000.

As a profitable company, it has no burn rate.

According to Reuters, 67.45% of the company is held by management and insiders.

CEO and Chairman Geoffrey Hampson has 17.17% and 0.56% through his wholly owned companies Hampson Equities Ltd. and Lake Forest Development Corp., Vice President Jean-Francois Meilleur has 0.52%, Director Glenn Walsh has 0.31% directly and 44.07% through his wholly owned company, Conex Services Inc., and CFO Greg Hayes has 0.12%.

A further 0.70% of control is vested in institutions.

Palos Management Inc. has a 0.27% stake, and Marmite Capital AG has one comprising 0.33%. Strategic investor Eric Sprott owns 750,000 shares bought in a private placement (0.82%).

2.26% is with strategic investors.

The rest is with retail investors.