Orford Mining (ORM) - $25M Earn-In on Gold Belt with Nickel Kicker

Orford Mining is a Canada-based mineral resource company, which is primarily focused on the acquisition, exploration and evaluation of base and precious metal assets. It is a gold exploration company focused on prospective and underexplored areas of Northern Quebec. The Company’s principal assets are the Qiqavik and West Raglan projects comprising a land package totalling over 80,000 hectares in the Cape Smith Belt of Northern Quebec.

We met with David Christie, President & CEO of Orford Mining which is a new and interesting story for us on Nickel and Gold projects in Quebec.

Company Overview

Orford Mining was launched as a public company in October 2017. The primary 2 assets at the time were the Qiqavik Gold project, which is a brand-new Gold district in Cape Smith Belt northern Quebec, and the west Raglan Nickel project, which was the start of the company. Orford Mining was a Nickel company to start with and since then, they've discovered Gold on the Qiqavik project and brought in a new partner on the west Raglan project called Wyloo Metals. They’ve also staked 3 new projects in the Abitibi of Quebec, which is a very prolific area for Gold so are now primarily a Gold company with a Nickel kicker.

David Christie is a geologist and worked in mining for about 15 years before he went into the financial world and became an analyst with TD and Scotia then he worked at the Dundee group managing money. 

The Foundation & History: New Gold District? 

Orford Mining has discovered a new volcanic, Gold bearing belt in Qiqavik. The belt has high-grade Gold at surface with over 40kms of strike length which is an exciting discovery for the company. Prior to this discovery, the area was known as a Nickel area. There is a geological boundary with Nickel to the south and Gold to the north which hadn’t been explored for Gold before now.

Securing Financing in Tough Markets: Shareholders & Liquidity

To date, Orford Mining has spent over CAD$8M on the project which is in the far northern part of Quebec and an expensive place to explore. Orford Mining has over 1,200km² across the region between the Nickel project and the Gold projects next door to two world class Nickel mines. 

In the year that the company went public, it wasn’t an easy time to raise money as a junior mining company but they were able to attract enough attention to raise CAD$5M to go public. The following year was a bit harder but they still managed to raise some money in the market. Orford Mining is planning to consolidate in the exploration industry as they believe there's too many small companies in the industry. They aim to bring good projects together to build a company that has projects over various different cycles of exploration from the very grassroots up to the more advanced.

Orford Mining had 2 big shareholders at the start which didn't create a lot of market liquidity, but now have a lot of new European and Canadian shareholders and institutional shareholders are up near almost at 30%. So, they now have a much bigger group of shareholders that are supportive of the stock. 

Structure VS Substance: Reasons for Alamos Gold's Involvement

Alamos became interested in the company due to the Qiqavik project which is the key project with huge discovery potential. Orford Mining is making discoveries of 650g/t at surface. Almost all the drill holes on that project have hit Gold and they've barely scratched the surface, having completed less than 6,000m of drilling across a 40km strike length. The reason Orford Mining was originally attracted there was due to 2 Faulkner drill holes from the mid-90s which drilled a Nickel anomaly and found a bit of Gold which wasn’t followed up until Orford Mining started exploration there.

Alamos is interested in the high-grade numbers at surface and the till sampling they've done that point towards a very long structure called the IP Lake Shear zone, which resembles the Cadillac Brake, which is one of the major Gold bearing breaks in the Abitibi. Orford Mining is planning to drill there this summer as they think there is something key there and is hoping to make a big discovery on camp scale.

Terms of the $25M Earn in with Wyloo Metals

Wyloo metals came in in 2019 and came in again at 22% in the financing in the latter part of last year so they're continuing to maintain their interest. The CEO of Wyloo Metals is very supportive as it gives the company some optionality in Quebec.

The Qiqavik project sits basically in the Arctic of Quebec so it is not going to be a quick discovery process due to the seasonality of the area. Orford Mining has only spent 21 weeks on the ground since 2016, when they started exploring the project. Alamos understands that this is going to be a long-term project and they are there for the long term.

Orford Mining has been talking to Wyloo for about 9-10 months. The West Raglan project is 814km² of land and Orford can't afford to explore it on their own, so needed someone to share that risk. They already have a number of discoveries across this project including the Frontier discovery of 2,500m strike length, high-grade Nickel, 3% Nickel, over 1% Copper and 3g/t to 4g/t PGE. 

Wyloo metals has a CAD$25M earn-in on the project and they have good technical people that are helping make decisions with Orford Mining. In the first 4 years they get 51% by spending CAD$6M, and if they complete a Feasibility Study (FS) and pay CAD$1.5M, they will get 80% which is the end goal after 7 years. Orford Mining seems sure that there are discoveries to be made there with the right geology, so they hope to be doing geophysics, prospecting and sampling this summer and drilling following that.

Joutel Properties in Quebec’s Abitibi District: Plans & Potential

Orford Mining also has 3 new projects they have staked in the past year in the Abitibi which will balance the seasonality that they have in the Arctic as they aim to have better news flow all year round. The 3 projects are in an area along the prolific Casa Berardi fault which they are drilling at the moment. 

Business Model & Focus: Where Does the Most Value Lay?

Orford Mining is a small company with CAD$18M market cap. They raised CAD$5.25M in September 2020, they’re receiving operator fees and management fees from Wyloo which is great. There are 3 projects in the Abitibi, 2 at West Raglan and the Qiqavik project which is a lot of projects that need funding. Orford Mining is looking to discover Gold deposits and as long as they fit their model, and they like what they find, they will keep the assets to take as far as they can. 

Scale of Potential at West Raglan

The West Raglan project has a lot more value that has been given by the market as the battery group metals in that area are going to drive those projects and exploration for them. The Qiqavik project and the 40km long strike length of high-grade Gold at surface also add to the story which Orford Mining needs to get out to the market to increase valuation for the company.

It's been a great year for Nickel, and West Raglan has great positioning along that belt with high-grade Nickel Sulphide, Platinum and Palladium targets. There are 7 different discoveries on the project, some are drilled and some just prospected. The Raglan deposits are combined with styled mineralization like pearls on a string, so there is the potential to discover many small deposits that make up the big deposit. The potential is huge for West Raglan as Orford Mining owns the rest of the belt.  

Expectations & Goals for 2021: Observations & Predictions for the Gold Market

Investors are excited about Nickel and the EV thematic. Orford Mining is sitting on a lot of land, they have a great partner and a lot of optionality further down the line. The market is not actually looking at that and understanding it as the scale of the Nickel opportunity there. The market is looking at the Gold project at Qiqavik but they haven't done enough yet for a higher valuation.  

This year, Orford Mining will concentrate almost all their efforts on the IP Lake trend and have already outlined 7km to 10km of shear zone there within the 40km long property. They're going to do some airborne geophysics, and fill in all the till sampling to get cut offs and then start diamond drilling. The drill is already on site ready to start this summer. They have selected the best places along the shear zone and believe they will make a discovery at the IP Lake shear zone. 

Orford Mining is a new story to us and it sounds like they've got some exciting things going on there with Gold and Nickel. It will be interesting to follow their story and see where the market places them this year.  

To find out more, go to the Orford Mining Website