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Typhoon Exploration Inc. (TYP:TSX Venture Exchange)
Shares Outstanding: 32,426,751
I’ve been following TYP for several years, and have started accumulating a position over the past few months. Investors are not drawn to this quiet stock at the moment, as they’re off chasing the latest pump and dump’s, pot stocks, lithium promo’s, etc. Suits me perfectly. Buy when nobody else is, goes the mantra of every successful investor.
To be sure, TYP is a high quality advanced exploration play with it’s sole focus in the Abitibi gold mining region of Quebec. The company has acquired, mostly via staking, several high grade prospects in the area. It’s flagship Fayolle project is under joint venture with a major mining company, so read on.
Fayolle Project, Quebec
The Fayolle project is located approximately 35 km north-east of the town of Rouyn-Noranda in the Abitibi region of Quebec. The company acquired the project in 2003 and has progressively advanced it over the years, until attracting a major joint venture partner in 2010.
Looking back to early drill results (2009) one will notice eye popping numbers such as 25 meters @ 25g/t Au, 13.4M @ 9 g/t, 7.6M @ 13g/t, etc.
In 2010 the company signed a $27 million Joint Venture with Hecla Mining (HL:NYSE) , which was followed by a $4 million PP @ 0.82/share, in which Hecla participated.
The Hecla jv went on to produce spectacular exploration and drilling results, including 6.5M @ 112g/t Gold. Following these exciting results, Hecla/Typhoon added a third rig and initiated a 50,000m drill program in 2011 This led to even more high grade discoveries, along trend and at depth… which led to adding a 4th drill rig to the program.
To date over $20 million has been spent on Fayolle and Hecla has become a 50% owner and operator of the project.
The updated mineral resources are estimated at 1,814,800 tonnes at 2.7 grams of gold per tonne, or 156,000 ounces of gold at a minimum cut-off grade of 0.8 grams of gold per tonne. Mineralization remains open at depth, to the north and to the south. Nearly 5,000 meters of drilling is yet to be incorporated into the updated resource estimate. Given the project’s proximity to infrastructure, power and milling operations, the company has conceptualized both an open pit and underground mining scenario, with the potential for a low Capex and short term ROI.
Taking a look at the 10 year chart, one will see the stock was a darling in 2010-2011 while news was flowing. Due largely in part to the lengthy drought in resource stocks, the company has been quiet on the news front, and investors have gone looking elsewhere. However the project is still alive and active. I suspect there will be developments to announce soon enough with regards to the next steps for Fayolle and it’s JV partner Hecla.
At todays price of 0.075 the company has a market cap of less than $2.5 million. Given that over $20 million has been spent on one project, and several other projects of similar quality in it’s portfolio, and it’s partnership with Hecla Mining, it’s our opinion this stock is extremely unnoticed and undervalued.
The company’s website is rich with detailed information, maps and geological data. Due your own due diligence before investing in any stock.