David Erfle | Yukon Site Visit Tour Review & Insights

Coming back on the show is David Erfle, the Junior Miner Junky, to share regarding his recent Yukon Mining Alliance Investment & Media Tour.  David offers first-hand insights regarding what the tour entailed, the pros and cons of Yukon as a mining jurisdiction and which companies stood out to him.

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Bill: Welcome back and thanks for tuning in. Ladies and gentlemen, I’m Bill Powers with Mining Stock Education. I’m speaking with the junior miner junky, David Erfle, about his recent Yukon Mining Alliance investment and media tour. David, thanks for taking the time to share your thoughts and experience from the past week. You are selective on how many and which site visits you go on every year, so why did you choose to go to the Yukon this year? 

David: Well I went last year and the media tour which is the tour I was on last year, we got to have site visits on the ground of a handful of projects and this year, the media tour would have been the same. So I chose something called a discovery tour this year and they did something a little different. This year, they partnered with the YGS, the Yukon Geological Survey, which is a government funded program and they gave us all iPads with the geologic history of the entire region on the iPad and a GPS tracker. So as we’re flying overhead in a 10 seater caravan plane about 3,000-5,000 feet above the ground, we can get an idea of the geologic history and the age dating history of the region while we’re flying over the sites. And also we had Carolyn Relf and Maurice Colpron inside the plane with us of the geological survey and we had linked up headsets where they were telling us, I mean, just incredible encyclopedic knowledge of the region. The history, the geology, the age dating history and just individual stories they have about certain companies that they work with and things like that. It was just really incredible to have that wealth of information going through our heads as we’re flying overhead.

Bill: Did they fly you over the various deposits of the particular companies? 

David: Yes they did. I mean, they flew us over numerous mine sites. There were too many to count. I feel like I’ve flown over the entire Yukon territory in a week. It was really something.

Bill: And that was based out of Dawson City, is where you flew into and flew out of? 

David: No. We flew in and out of numerous different sites. There’s landing strips all over the Yukon, you know. Each mining company…not each mining company but various mining companies have built their own landing strips where you fly into the strip and then some of the projects are even more remote where you fly into their strip and then you have to be helicoptered to their project.

Bill: From the perspective of a mining investor, what would you say are the strengths and the weaknesses of Yukon as a jurisdiction? 

David: The definite strengths are everybody is on the same page. The government, the 14 first nations in the region and the mining companies. They’re all on the same page, they all want the same thing. The government and the first nations know mining is very good for the economy. A lot of their GDP comes from mining and the thing that really struck me about all these mining companies was they’re all good people. They’re all genuine, honest people that are trying to mine responsibly and find high grade deposits. And with the conference, the mining conference that takes place in Dawson during the middle of this trip is really something because there’s heads of tribes of first nations there, the Yukon minister is there of mines and energy, all the companies are there and we have a banquet dinner where we all get together and have dinner and talk amongst each other and it’s really something.

The obvious drawbacks: the territory’s remote, it’s got a harsh climate and there’s little infrastructure on a lot of the projects. So you just have to be twice as patient with some of these Yukon plays as you do with some of the regular, some of your average junior exploration companies who can work all year round. But the payoff is big because a lot of these projects are very high grade and they could be very large.

Bill: As a jurisdiction, do you think companies there are trading at a premium or a discount compared to other jurisdictions? 

David: Right now, a discount because as you know, the sector is out of favor right now and a lot of the juniors are being sold off pretty hard as the gold price today just closed below 1,260 on a monthly June basis. So that does not bode well for the gold price in the medium term here.

Bill: With the companies that you knew of or learned while you were there in the Yukon, which one stood out the most to you and why? 

David: Well, one of my favorite plays there is Klondike Gold. The CEO, Peter Tallman, has discovered the hard rock source of the alluvial gold that was taken out of the Klondike back during the Klondike Gold Rush in the late 1800s. It’s been said that there was no hard rock source but he has found it. He’s concentrating at the head waters of the El Dorado and Bonanza creeks there and if he can prove up a multiounce deposit, this stock could really go a long way in a bull market because the Klondike Gold Rush is world renown. I mean, everybody knows about the Klondike Gold Rush. Even in Germany, they teach the history of the Klondike in school. So if you have a gold bull market and a story like this, the stock could really do well because it’s got a very tight share structure and the company is cashed up for the next few years. And there’s some also in the money warrants that could bring in another $7 million and there’s, I believe, 7 billionaires are in the company, have stock in the company including Frank Giustra and Eric Sprott. The land package is huge. It’s like 55 square kilometers and it’s about 125 clicks south of Goldcorp’s coffee deposit and the geology is very similar of the coffee deposit and the coffee deposit is very large and Goldcorp is trying to build a mine there.

Bill: Did this trip provoke you to buy or sell any of your Yukon companies? 

David: No. I have plenty of exposure all ready in the Yukon but I am selling one of my Yukon holdings but it has nothing to do with the project. It has everything to do with the gold price because it’s basically an optionality play and like I said before, I feel the gold price is going to be under pressure here and optionality plays are going to get hit the hardest because they need a higher gold price. And any company that has a deposit that needs a higher gold price will get hit a little harder than high margin deposits that are being proved up by some of these.

Bill: Well David, you can find him on the internet at juniorminerjunky.com and he has a well respected newsletter where introduces you to many of these companies. You get his firsthand thoughts after he goes on trips like this. He’s basically a mining investor to emulate in terms of a retail turned, accredited investor, David is the man to follow. David, any concluding thoughts with our discussion today? 

David: No. I think I think my thoughts would be be very patient here with what’s going on in the market. You’re going to be presented with some wonderful opportunities here in the summer and if you do have the gumption to buy some of these things, make sure you do your due diligence first and concentrate on companies that are concentrating on high margin deposits because those are the ones that will hold up the best during this downturn.

Bill: David, thank you for taking the time to chat with me today. I appreciate it. 

David: Thanks a lot for having me, Bill. Always nice to talk to you.