Dateline chairman backs US gold, rare earths push with $1.95M bet
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Murray Region
A corporate executive’s decision to risk his own money is often seen as the ultimate vote of confidence in the business he manages. In the case of Dateline Resources, that vote came in the form of a whopping $1.95 million check from non-executive chairman Mark Johnson.
The company said Mr. Johnson exercised a parcel of 97.6 million listed options, cash flowing directly into Dateline’s coffers and increasing his personal stake in the company to a significant 15.3 percent.
This move appears to be a strong signal from the board as Dateline continues to move forward with its impressive portfolio of gold and critical mineral projects in California. This timing is particularly noteworthy after the company recently submitted a credible feasibility study (BFS) forecasting solid economics for its flagship Colosseum gold project in California.
The BFS for Colosseum, released last month, is supported by a JORC compliant mineral resource of 27.1 million tonnes grading 1.26 grams per tonne gold for 1.1 million ounces. The study outlined a high-margin gold project with a pre-tax net present value of US$785 million (AU$1.14 billion) and a nice pre-tax internal rate of return of 49.5 per cent.
These figures were based on the gold price of US$4200 ($6090) per ounce; this is slightly above current spot prices of US$4040 ($5855). But the study’s high margins suggest it will likely remain profitable even at more conservative gold prices.
With such metrics on the table, Dateline wasted little time in moving the project toward the starting line. It recently appointed Vancouver-based GenCap Mining Advisory to manage the project financing process and also brought in project management consultants Alvarez & Marsal as construction managers to deliver the Colosseum on time and on budget.
But the story of the Colosseum is not just about gold. The project is also being evaluated prospectively in terms of heavy rare earth elements (HREE). It is also strategically located just 10 kilometers north of the giant Mountain Pass rare earth mine, the only scale rare earth mining and processing operation in North America.
To put this in perspective, the adjacent Mountain Pass mine has a heavy mineral resource of 49.7 million tonnes, grading an impressive total rare earth elements (TREO) of 6.68 percent. Dateline says it is focusing on the dual commodity award and has already begun drill tests at Colosseum for critical and strategic HREEs such as dysprosium, terbium and yttrium.
Beyond the Colosseum, Dateline is heavily consolidating its holdings at the Music Valley heavy rare earth project, also in California. The area is known to host HREE mineralization from historic rock fragment sampling by the United States Geological Survey, but has never been subjected to modern exploration techniques. This appears to represent a significant blue-sky opportunity for the company.
Complementing the American portfolio in California, the Argos strontium project is reportedly the largest strontium deposit in the United States and is located just 100 kilometers from the Colosseum.
It’s one thing for a company to talk about its assets, but it’s another thing entirely for its chairman to put nearly A$2 million of his own money on the table. Mr. Johnson’s big investment suggests from above that Dateline’s projects in California’s resource-rich lands hold serious promise.
With a high-margin gold project heading towards development and a rare earths story taking shape alongside a world-class producer, his bet may be well-timed.
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Contact: mattbirney@bullsnbears.com.au
