Rupert Resources

Rupert Resources is a mineral exploration company with a new 4 million ounce gold discovery, named Ikkari. This discovery makes up the Company’s “Rupert Lapland Project”, which also includes the Pahtavaara gold mine, mill and exploration permits and concessions located in the Central Lapland Greenstone Belt of Northern Finland.

The discovery has several notable characteristics which should help its development into a low impact high margin gold mine of the future. We see the Company as a potential takeover target by one of the senior gold producers who are active in the region. The alternative is they continue acquiring new discoveries to replace the mined gold reserves. This will help improve their production profile with low cost, high value and low carbon emissions production.

Exploration has now been de-risked so the question is no longer if, but by how much. Because of the Ikkari discovery, there has now been sufficient gold discovered to justify a mine, so new discoveries and incremental increases in resources should justify a premium valuation. Senior gold companies have shown they are prepared to pay up for the best new discoveries, Great Bear Resources being a recent example.

Rupert Resources plans to publish a Preliminary Economic Assessment in the second half of 2022. This will outline the value of each discovered ounce, as well as highlight some of the exceptional characteristics of the project. This includes close proximity to infrastructure, access to cheap and low emissions power, great metallurgy and potential for low-cost surface mining.

At the same time, the Company plans to continue its tried and tested exploration methodology at four new target areas in a relatively under-explored mining district. Investors should take comfort from the other companies active in the region including Agnico Eagle, Kinross, B2Gold and Newmont (through a minority shareholding in Rupert’s neighbour Aurion Resources).

Funding and near-term catalysts

As of the end of February, Rupert Resources had C$45million in cash, sufficient to fund work through its PEA and another winter drilling program. Future financing for construction is several years off. Rupert has issued less than 5% of its share capital in its last two financings with key shareholders (including Agnico Eagle) following their interest in both rounds.

Exploration success has been recognised by the market and dilution could be further mitigated by further discoveries. Ikkari’s grade, simple flowsheet and proximity to infrastructure mean that the project will be insulated from the current high inflationary environment.

Exploration potential – what is it about Finland

The Central Lapland Greenstone Belt of Northern Finland has many similar characteristics to the Abitibi of Northern Ontario, Yilgarn of Western Australia and Birimian of West Africa. Each of these areas has an exploration and prospecting history of over 100 years. In contrast, Finland exploration was undertaken by Outokumpu and the GTK (Geological Survey of Finland) up until 1986, when the country joined the EU.

The primary focus of the state-run exploration was base metals with coincident gold mineralisation left unexplored. The Pahtavaara and Kittila mines were both found at surface. The significance of Rupert’s Ikkari discovery was that it was made under cover and provided evidence that there were further deposits of scale present in the region.

Rupert’s team continue to apply and adapt their exploration model with the goal of making further discoveries at their Area 1 target (5km x 5km area which is home to Ikkari and five other discoveries) as well as four other prospective areas contained within Ruperts 785km squared land package.