This week, gold pushed through one level of overhead resistance at $1,868 then tested $1,900.
It’s being pushed along by the familiar fundamentals of supply and demand but getting more “oomph” from inflation and the storm clouds of war over Europe.
Here’s a chart showing how far gold has come recently, and how far it needs to go to get back to a real bull market:
My view is that a new gold bull is not only possible but likely.
And with that in mind, I’m looking for undiscovered stocks — the “jewels in the dustbin” that I sometimes talk about — that can be picked up for relative pennies, and that have tremendous upside.
I have one of those stories for you today. How about a mining company that:
- Is developing a new gold mine in Alaska, with 1.3 million ounces in measured and indicated ounces. And it’s high-grade, with an average grade of 4 grams of gold per metric ton!
- Is located in Alaska on the Alaska Highway, so infrastructure is close by.
- Has a partnership with a senior miner who has a mill nearby. All the ore from this new project will be trucked to that mill, saving millions of dollars in development costs.
- Expects to be in production in two years.
- Has another gold-rich project that it can develop with cash flow from the first project.
- The company I’m talking about is Contango Ore (CTGO). Recently, I did a Zoom interview with Contango’s President and CEO Rick Van Nieuwenhuyse.
His company has a high-grade (4 grams of gold per metric ton) gold project in Alaska called Manh Choh, and a partnership with Kinross Gold (KGC).
Kinross agreed to pay two-thirds of the development of Manh Choh, and it will truck the ore to its Ft. Knox mine down the road, so …
- That cuts out the need to build a new plant.
More good news: Contango recently moved up to be listed on the New York Stock Exchange (NYSE).
And its Manh Choh project is awaiting a feasibility study.
Assuming that’s positive, the mine will be built this year — Kinross has already budgeted for it — and it will go into production next year.
I highly encourage you to watch the new video here:
So, how long has Contango been on my radar? I originally interviewed Rick Van Nieuwenhuyse back in November.
He’s fulfilled all the promises he made then. You can watch that video for comparison right here.
Should Investors Consider Buying Contango?
There’s good news and bad news.
Contango is rallying along with the recent rise in the price of gold, which is a good sign. However, the volume on this stock is very, very low.
- So low that’s the deal breaker for me … for now.
Let me be clear: I like this company a lot. I think it should have a bright future. But as with any explorer/developer, a lot can go wrong between here and production.
And the volume on this stock is so low that if I needed my paying subscribers to sell, they may not be able to find a bid and get out.
So, for now, I’ll keep it on my watch list. If/when volume improves — perhaps after the feasibility study comes out — we’ll revisit it.
And sure, my Gold & Silver Trader subscribers will be the first to receive any news I have on Contango … just as they were the first to see this new interview.
But for now, you can see that there are some very exciting small companies that are building a future in gold mining. Contango isn’t the end of the line — it’s just the beginning.
There are a lot of small explorers and developers that are completely off Wall Street’s radar, even as gold gets ready to make a historic run.
I plan to be aboard those rockets when they lift off the launch pad. Do your own due diligence before you buy anything.
All the best,
Sean Brodrick
