2019: The Year Quality Explorers Will Break Out

After a tough 2018 for most junior resource companies, 2019 looks like the year that quality explorers break out.

K2 Gold has the team, the share structure, and recently added Great Bear Resources' — also a Discovery Group company — CEO Chris Taylor as an advisor.

CEO Steve Swatton explains why he’s excited again and what to expect from K2 this year.

To your wealth,


Gerardo Del Real
Editor, Junior Mining Monthly and Junior Mining Trader.

Gerardo Del Real: This is Gerardo Del Real with the Outsider Club. Joining me today is the President and CEO of K2 Gold (TSX-V: KTO)(OTC: KTGDF), Mr. Steve Swatton. Steve, how are you today?

Steve Swatton: Great. Thanks very much, Gerardo. It's great to be back with you.

Gerardo Del Real: It's been a bit. I joked off air that it's been a quiet winter. 2019 is shaping up to be a much more stable gold market. Some hope, like myself, that the second half leads to a breakout. You've done an excellent job behind the scenes positioning the company for a big 2019.

K2 Gold, for those that are not familiar, is part of the Discovery Group of companies that's led, of course, by John Robins. You had a piece of news that I found interesting. There's two pieces. The first part is you exercised your option on the Wels property. I want to talk about that. But before I do, I want to talk about the addition of Chris Taylor, who has agreed to become an advisor to the company. Chris Taylor, of course, for those not familiar, is the President and CEO and a Director of Great Bear Resources, what has to be the 2018 story of the year in the junior mining space. That company trades for about $4.00 Canadian now. It was trading in the cents.

Can we talk about the addition? And then let's talk about Wels.

Steve Swatton: Yeah, sure. Chris is an amazing, phenomenal geologist. He is a younger guy, mid-40s, with incredible experience in a whole range of different assets. He used to work for Imperial Metals, I believe, before. Fundamentally, he's a field geologist with a financial brain. And of course, with the recent success of Great Bear, he's really cranked up the heat here, and founded with his partner, Bob Singh, a tremendous — it looks like a new asset discovery in Red Lake district, which all of the majors are looking at it right now. Its largest shareholder is Rob McEwen. Rob was the catalyst that created this latest interest and, of course, Chris has raised a significant amount of money on the basis of it. He just told me yesterday that he really could continue drilling for the next two years without having to have another financing.

The significance for K2 is that we obviously mentioned in the past we're looking for assets elsewhere. We were looking in Alaska. We still are looking in Alaska, but something has come up on our radar screen here in mainland USA that's of extreme interest to us. It's a more advanced property than the Wels property. Now, there's no security that it will come into the company. We haven't signed any agreement or anything like that, but I'm getting the feeling that it is something that would actually make a difference to the company, should it come in.

Anyway, I've been working on that for the last four months, five months now. Hopefully, I'll be able to announce some news in the near future, but just to reiterate, there's nothing being said, there's nothing being signed, an agreement at this stage.

Gerardo Del Real: To be clear, you're excited about something. You haven't shook hands on it. You haven't signed off on it. It may or may not happen. Let me explain to people really briefly why, whether or not you execute on this, I believe K2 Gold is an extremely attractive speculation at these levels. You have a market cap of approximately $5 million Canadian.

For those of you that have not seen gold bull markets in the past, just having someone of the likes of John Robins, having yourself and the team that you've put in place, you could run a shell company in those types of markets, a better market which I see coming, that would demand a market cap multiples of where you're at now.

With that being said, Wels — and I know because we've talked about this before — is an extremely attractive project on its own merit. That's a part of what I want to talk about today. You just went ahead and exercised your option where you now have earned into 90% of that project. Can we talk about Wels for a second?

Click here to continue reading...