August 30, 2023
Luca Mining Corp. (TSXV:LUCA, BUY, C$1.00 target, Taylor Combaluzier) and EnviroGold Global Ltd. (CSE:NVRO, BUY (S), C$0.65 target, Timothy Lee) have signed a Memorandum of Understanding (MoU) to process tailings at the company’s 100%-owned Campo Morado mine in Guerrero State, Mexico. The goal of this project is to evaluate the reprocessing of historical Campo Morado tailings that are currently being stored in the project’s original tailings storage facility and contain ~3.3Mt at 1.32% Zn, 0.3% Cu, 0.49% Pb, 1.57 g/t Au, and 94 g/t Ag. Once the agreement is finalized, the initial stage of the project will include further data, and sample collection and test work, followed by a PEA-level study and NI 43 101 technical report. Notably, EnviroGold will work with Luca to put the study together. We also note that this project follows the encouraging pilot plant scale test work on tailings for EnviroGold’s Hellyer project in Australia that was completed in June, which used a ~500kg sample of Hellyer tailings grading 2.59 g/t Au, 59 g/t Ag, 0.11% Cu, and 0.84% Zn, and recovered 91% of Cu and 82% Zn contained in the tailings (read notable). In our view, this is a positive update for Luca as it continues to develop its Campo Morado mine with a familiar business partner. Campo Morado comprises approximately half of our total valuation for Luca and could continue to improve as these types of studies and technical reports are released. Read more
Company Specific Disclosure Details
EnviroGold Global Ltd. – CSE:NVRO – 3
Luca Mining Corp. – TSXV:LUCA – 1,2
- The analyst has visited the head/principal office of the issuer or has viewed its material operations.
- The issuer paid for or reimbursed the analyst for a portion, or all of the travel expense associated with a visit.
- In the last 12 months preceding the date of issuance of the research report or recommendation, Red Cloud Securities Inc. has performed investment banking services for the issuer.
- In the last 12 months, a partner, director or officer of Red Cloud Securities Inc., or an analyst involved in the preparation of the research report has provided services other than in the normal course investment advisory or trade execution services to the issuer for remuneration.
- An analyst who prepared or participated in the preparation of this research report has an ownership position (long or short) in, or discretion or control over an account holding, the issuer’s securities, directly or indirectly.
- Red Cloud Securities Inc. and its affiliates collectively beneficially own 1% or more of a class of the issuer’s equity securities.
- A partner, director, officer, employee or agent of Red Cloud Securities Inc., serves as a partner, director, officer or employee of (or in an equivalent advisory capacity to) the issuer.
- Red Cloud Securities Inc. is a market maker in the equity of the issuer.
- There are material conflicts of interest with Red Cloud Securities Inc. or the analyst who prepared or participated in the preparation of the research report, and the issuer.
Analysts are compensated through a combined base salary and bonus payout system. The bonus payout is determined by revenues generated from various departments including Investment Banking, based on a system that includes the following criteria: reports generated, timeliness, performance of recommendations, knowledge of industry, quality of research and client feedback. Analysts are not directly compensated for specific Investment Banking transactions.
