Netolitzky’s Skeena Resources Funded For 12-18 Months, Aggressive Drilling Commencing

The company’s very valuable database of geological mapping, geochemical sampling, trenching and more than 100 diamond drill holes (>14,000 metres) and one adit on Hawk vein (278m of workings) makes the Spectrum Project more than merely an early-stage prospect. One of the foremost geologists on the planet, Ron K. Netolitzky, M. Sc, with extensive knowledge of the Gold Triangle of Northwestern British Columbia, is the Chairman and second largest shareholder. Add to the above facts, a large pile of cash on the balance sheet.

Although I’ve mentioned Mr. Netolitzky in prior articles, I’ve not explicitly stated his claim(s) to fame. Please consider the historic mines in NW B.C. where Netolitzky was the driving force behind their development.

Snip Gold Mine

1 million oz. Au (gold) produced at 25 g/t

Eskay Creek Mine

3.27 million oz. Au produced at 49 g/t AND 158 million oz. Ag (silver) produced at 2,406 g/t

Those mines sported bonanza grades, an indication to me that Skeena’s longer-term goal of 2-3 million ounces at a grade of 12+ g/t is not a pipe dream. Evidence of Skeena’s potential can be found in the drill results completed in 2014.

[Note: For convenience, highlights of Skeena’s drill results are as follows]

14-SP-003: 23.84 g/t Au over 6.5 m, including 40.43 g/t Au over 3.5 m

14-SP-004: 10.63 g/t Au over 27.0 m, including 66.00 g/t Au over 2.0 m and 20.4 g/t Au over 2.0 m, 9.2 g/t Au over 2.0 m, 8.0 g/t Au over 2.0 m and 22.7 g/t Au over 2.0 m

14-SP-005: 18.60 g/t Au over 2.0 m and 7.32 g/t Au over 2.0 m

14-SP-006: 43.80 g/t Au over 2.0

14-SP-007: 9.50 g/t Au over 2.0 m

14-SP-008: 4.58 g/t Au over 9.0 m

14-SP-009: 13.70 g/t Au over 4.0 m and 254.50 g/t Au over 2.0 m.

How Does Skeena Compare to Peer Junior Gold Companies?

For junior gold companies there are more differences than similarities. Jurisdiction, grade, depth of deposit, infrastructure, balance sheet, capital to reach production, strength of management and Board, etc. Instead of ticking off Skeena’s boxes on those metrics, I refer readers to page 18 of the company’s new (June) corporate presentation. In my analysis I replaced Pretium, Roxgold, Continental and Rubicon with much smaller companies Unigold, Nio Gold and Goldstrike Resources. I derived an average EV/oz of $47/oz. That figure does not include Goldstrike, an early-stage company in the Yukon, with no defined resource yet having an EV of $20 million. Skeena has an EV of $7.8 million. Assuming that company achieves a NI 43-101 compliant resource of 1 million + ounces on its first or second resource estimate, the company would be trading at an 83% discount on an EV/oz comparison.

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Disclosure:  I, Peter Epstein, CFA, MBA, do not currently own any shares in Skeena Resources (SKE.v) or any other company ...

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