Nexus Gold – This Week’s 2nd Full Warrant Financing

Nexus Gold – This Week’s 2nd Full Warrant Financing

Nexus Gold (TSXV – NXS) is my second full warrant financing of the week.  I was able to get in at $0.115 with a full 2-year warrant at $0.18.

For some background, Nexus Gold is primarily focussed on gold exploration in Burkina Faso.  And Burkina Faso still gives me nightmares. Back in 2015, after taking quite a large position in True Gold, I woke up one morning to news of a coup in Burkina Faso – somewhat surprising considering the country’s previous relatively sound geopolitical history.  Suffice it to say, True Gold’s shares got slaughtered and I took a 6-figure loss – not fun.

But with its low market and a full warrant to boot, I’m back at it in Burkina Faso with Nexus Gold (maybe I’m a glutton for punishment!).

With its Bouboulou/Rakounga and Niangouela/Dakouli projects located in the Birimian Greenstone belt of Burkina Faso, Nexus Gold has a very nice portfolio of gold targets.  As part of its maiden drill program in 2017, Nexus intersected 23m of 1.04 g/t gold in one hole and 8.15m of 4.41 g/t gold in another at the Bouboulou/Rakounga project.  And at Niangouela/Dakouli, Nexus intersected 4.85 m of 26.69 g/t gold in one hole and 6.2 m of 4.00 g/t gold in another.  Those are nice numbers and a bloody good start.

Nexus Gold has also recently diversified its geopolitical risk by acquiring 2 projects in Canada: the New Pilot gold-copper project in BC and the McKenzie gold project in the Red Lake region of Ontario.

After closing the 2nd tranche of its financing, Nexus Gold will have about 65 million shares out.  At the $0.115  financing price, that’s about a $7.5 million market cap with some $3 million in cash for an enterprise value (EV) of $4.5 million.  I think Nexus Gold will be a nice punt if this nascent upswing in the gold market gets any legs.

Philip O'Neill
Philip O'Neill
poneill@mp1capital.com