Mayfair Gold’s Hidden Gem Taking Form
The Fenn Gibb gold project, located in the Timmins Gold Belt, has been a misunderstood orphan asset for quite some time, having moved from company to company on many occasions since the early 1990s. It was first discovered by Pangea Goldfields, which was later bought by Barrick Gold. Barrick then sold the property to Lake Shore Gold. Soon afterward Tahoe Resources took control, and in turn, was acquired by Pan American Silver. That’s when CEO Patrick Evans and his management team at Mayfair Gold (TSX-V: MFG; OTCQB: MFGCF) found Fenn Gibb, which they acquired in 2020.
After almost 27 years in the mining business, Evans has a knack for identifying undervalued assets. He started at Placer Dome, Canada's number two gold producer, and then moved to the junior sector about 20 years ago to focus his search on underappreciated gems. So far, that approach has paid off. He and his team have built two mines - a platinum mine in South Africa and a diamond mine in the Northwest Territories of Canada - and in six instances, producers have acquired companies that he has guided. Throughout it all, Evans has always kept the focus on total shareholder return, which has enabled him and his team to keep a very loyal shareholder base over the years.
While Fenn Gibb has passed through many hands, it has always been regarded as a keeper by Mayfair, which has been working to fast-track the development of the project. In less than three years, it has nearly doubled the recourse from 2 million to 3.7 million indicated ounces following a 150,000-metre drill program. And they’re just getting started. With more than 75% of the property unexplored, there is room for substantial growth. So far, Mayfair has made two significant discoveries that could change the outlook of the project. The Footwall Zone stands out for its high-grade of mineralization, which is five times the grade of the property’s original deposit. The Contact Zone, a more recent discovery, is below the original deposit at depth. After drilling three 1,200 metre holes, Mayfair has again yielded several high-grade intercepts that have the company believing this find could potentially double their 3.7 million ounce resource.
“Our lives have become complicated in a good way,” Evans admitted.” We've got what we call the first mine deposit, which we've taken through resource delineation. We start a pre-feasibility study shortly, and then we're going to start a definitive feasibility study next year. We'll also start the permitting process early next year for the first phase of development of an open pit mine. So, we expect that we could have Fenn Gib in production by 2026 or 2027.”
Mayfair is intensely focused on minimizing shareholder risk through the development cycle, and the way it feels it can best accomplish this is through a phased approach. “It's a very large, disseminated, open pit deposit,” Evans explained. “It could probably support a mine doing 30,000 tonnes a day with on-site treatment and pouring of gold. We're looking at a staged development starting at 12,000 tonnes a day, which would produce about 200,000oz a year. We're also looking at off-site treatment of a gold float concentrate to minimize permitting and capex risk. Later, we'll fund an expansion from free cash flow that will double output from 12,000 to 24,000 tonnes a day. We’ll build our own gold processing plant on-site and pour gold at Fenn Gib. You can't do that with every asset, but this asset lends itself to a phased development.”
Evidence indicates that the market likes where Mayfair is heading. Mayfair’s market cap has grown dramatically over the last 24 months and now stands at $200 million a little more than 36 months after acquiring Fenn Gib, and the company believes it could double its market cap simply by delivering on the milestones that Evans has outlined.
With the momentum that is being created by Mayfair’s first mine deposit and the two new discoveries at the Footwall and Contact Zones, it’s easy to see why Evans is so excited. “In the mornings I wake up looking for the latest drill results to see what we've intercepted. We’re adding ounces to Fenn Gib at a phenomenal rate, and that helps drive shareholder value.”
These are all encouraging developments that will help ensure that Finn Gib continues to get the attention and love it deserves.
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