Golden Arrow’s new partner brings lot to the table (see attached) that has become a 25% Golden Arrow asset.
Golden Arrow has already been in production for almost 2 years, before a shovel has even entered the ground at Chinchillas, uniquely a different orphan period not being accounted for by the market.
Mining hall of famer, Pierre Lassonde, revolutionized the mining industry with the creation of Franco-Nevada, the first gold royalty company. Its initial transaction was in 1986, the $2 M royalty purchase on Barrick’s Goldstrike, which consequently became North America’s largest gold mine.
Franco-Nevada’s portfolio of royalties now collects over 460,000 of gold equivalent ounces, generating close to $500 M in cash flow per annum.
Thirty years ago, Pierre also released a chart that has now become a staple in the mineral exploration business – the Lassonde Curve. The Lassonde Curve is a chart outlining the life of mining companies beginning at exploration and ending in production, showing value that the market attributes to each stage.
There are now many variations of the curve, but the theory behind it holds the same. As a company de-risks its project, more value is unlocked for shareholders. The discovery phase is by far the most exciting, and ground-floor investors can see tremendous gains in a short time frame. The project is proven up until a deposit is finally defined.
After a deposit is delineated, the project enters the development phase where many initial investors begin taking gains off the table. This period can be accompanied by a lack of news flow as companies work on economic studies, which add to the sell-off by impatient investors.
When a company finally begins construction, the reality of cash flow becomes apparent, and value investors begin to enter the stock. It is up to the company to keep its ‘pipeline’ full to ensure value creation outpaces depletion.
As investors, we believe the Lassonde Curve holds true and try to time our entries and exits accordingly. Looking at our larger holdings, this point becomes quite obvious.
Discovery, High-Impact Plays:
Buy Low, Sell High
Shawn Perger
Communications
Grosso Group Member Companies
BLUE SKY URANIUM- BSK.V
ARGENTINA LITHIUM AND ENERGY- LIT.V
GOLDEN ARROW RESOURCES CORPORATION - GRG.V
Office: . . . . .604-687-1828
Mobile: . . .. 778-686-0135
Toll Free: . .1-800-901-0058
Skype: . . . . . perger10
