New Exploration Permit Granted for Nutmeg Mountain Site

NevGold Corp. (NAU:TSX.V; NAUFF:OTC; 5E50:FSE) announced today that it has been granted an exploration permit for its Nutmeg Mountain project in Idaho. NevGold Corp. targets large mineral systems in the established jurisdictions of Nevada, Idaho and British Columbia. The Company’s current focus is on its Limousine Butte project in Nevada and the Nutmeg Mountain project in Idaho. It also has the Cedar Wash project in Nevada and the high-grade Ptarmigan property in southeast British Columbia.

The newly permitted Nutmeg Mountain property is located approximately 80 kilometers north-northwest of Boise and approximately 20 kilometers east of the town of Weiser. The Company began drilling at Nutmeg Mountain on January 18th of this year and this new exploration permit allows for an expanded drill program on large portions of the highly prospective ground not previously tested on the project.

The Catalyst: New Exploration Permit

The Nutmeg Mountain location hosts a 2020 mineral resource estimate of 910,000 indicated ounces of gold (43.5 Mt @ 0.65 g/t Au) and 160,000 inferred ounces of gold (9.1 Mt @ 0.56 g/t Au).

Approximately 85% of the 2020 resource estimate is on patented mining claims and other private properties that you can view here . The yellow line outlines the project boundary, with green shading defining the unpatented BLM claims allowed by the Exploration Notice. The remaining unshaded area outlines the patented claims and private leases that NevGold may drill under various policies. There are a number of identified high-grade resource expansion and exploration targets on the unpatented mining claims (green shading) that create significant opportunities for growth as only approximately 15% of all historic drilling on the project has occurred on this ground.

According to the National Inflation Association’s Gold Moon indicator, gold is expected to end 2023 at $2,670 an ounce. When the price of gold rises, they inevitably lift the stock prices of the gold mines with it.

After the Company completed initial geological modeling, many resource expansion and exploration targets were identified on the unpatented mining claims which have created a strong opportunity for significant resource growth on the project. These identified targets will be tested as part of the current 2023 drill program, which is already underway with initial sample submission to the assay laboratory imminent.

Brandon Bonifacio, CEO of NevGold, said, “Since closing the transaction in August 2022, it has been a very diligent start to our work at Nutmeg Mountain, with large portions of the project showing minimal to no historical drilling.”

“Upon the completion of our 2022 drill target exercise, it was clear that many important resource growth and exploration opportunities reside within the unpatented federal BLM claims. The timely receipt of this permit will allow us to commence drilling on these targets as part of the current drill program.”

“The approval of the permit is another milestone in de-risking at Nutmeg Mountain and we appreciate the various governing bodies that have worked positively and cooperatively with us throughout the process. We remain on track to receive initial drill results from Nutmeg Mountain by March.”

Why this sector? Country is safe, country full of gold twice as much

Mining stocks — particularly those with sizeable underground reserves — are a popular haven during times of economic uncertainty, so stocks like NevGold’s tend to perform well The market is in a state of confusion.

Rowan Dunne points out in Mugglehead Magazine that “positive shareholder relations make NevGold a worthwhile investment”.

Additionally, gold is expected to outperform the stock market this year due to growing international demand. “China imported more gold from Switzerland last year and increased gold purchases from Russia,” writes Anna Golubova for Kitco.

“Swiss gold exports to China hit a four-year high in 2022, with China taking in 524 tonnes of gold worth around $33 billion. This is a massive increase from 354 tonnes in 2021 and the highest since 2018 customs data, according to Swiss.

According to National Inflation Association‘s golden moon display, Gold is expected to end 2023 at $2,670 an ounce. When the price of gold rises, they inevitably lift the stock prices of the gold mines with it.

Why this company? Large stocks, good relationships

NevGold offers other advantages in addition to its ground reserves and expanding drill program. As Rowan Dunne points out in Mugglehead Magazine, “positive shareholder relations make NevGold a worthwhile investment.”

Clive Maund said: “As it is just starting to move higher after last week’s sharp drop this looks like a great point to pick up again.”

“GoldMining Inc. (GOLD:TSX; GLDG:NYSE.American) is a major shareholder owning approximately 19% of NevGold’s shares. GoldMining also recently sponsored NevGold’s financing, which closed in December with a $1.25 million pre-sale order.

McEwen Mining Inc. (MUX:TSX; MUX:NYSE) is another shareholder who owns nearly 8% of NevGold’s issued and outstanding shares.”

Investment specialist Clive Maund agreed with an analysis published in December. “On the latest 6-month chart, we can see the base pattern that formed after the pullback to the last low in late September and how there was a big surge in volume in November, mostly upside volume that the Accumulation line has risen sharply to the point that it’s already at new highs despite the recent dip,” he explained.

“This is seen as strongly bullish, especially as the sector enters a major new uptrend. As it is just starting to turn up after last week’s sharp drop, this looks like a great spot to pick it up again. This is considered an excellent spot to add to positions or make new purchases.”

Why now? Undervaluation, pending investigations

Although NevGold’s claims are large, they appear to be largely undervalued by the market. Comparable mining and exploration groups (notably Freeman Gold, Getchell Gold, West Vault Mining, Integra Resources, Nevada King Gold, Augusta Gold and Liberty Gold) are trading at an average EV/resource multiple of CA$70/oz AuEq. As of this writing, NevGold is trading at less than CA$15/oz AuEq, giving investors significant (460%) immediate revaluation potential.

In addition, the release of assay results from new drilling at Nutmeg Mountain – expected in early March – could bring the valuation of the Company’s underground exposure to a level comparable to other operations in the sector.

Ownership and Share Structure

NevGold has a market capitalization of approximately $25 million with 71,418,219 shares outstanding. The Company has issued 16,947,558 warrants of CA$0.60, of which 10,303,127 will expire on June 24, 2023, and 5,266,000 options. It also has CA$3.7 million in cash against a monthly burn rate of CA$50,000 meaning it is funded to complete all work programs for 2023 including approximately 15,000 meters of drilling on its projects.

Insiders and directors own 32% of the company. 26% is held by strategic investors, GoldMining Inc. holds another 19.3%. McEwen Mining holds another 7%. The remaining 42% is in retail.

NevGold recorded over CA$150,000 in insider participation in its most recent funding round, which closed in December 2022, along with a CA$1.25 million lead order from GoldMining Inc.

Drilling costs are currently CA$300/meter for core and CA$125/meter for reverse circulation.

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