Metals investors are used to seeing junior companies founded on a good idea and a healthy amount of hope. But if the junior company was founded a couple of decades ago and currently owns 4 projects and is achieving targets to grow, it's a different story.
We spent some time reviewing Sona Resources and talking to President and CEO John P. Thompson. Sona Resources has an interesting story that we believe investors will find quite compelling. The Sona Resources story is one of flexibility and smart decisions with a healthy mix of patience thrown in for good measure.
Mr. Thompson has an excellent geological background. He has 35 years of experience in surface and underground exploration, mine development projects, property evaluation and acquisitions, joint venture negotiations, mineral resource estimation and project preliminary economic analysis. He has managed operations for junior exploration companies. Mr. Thompson has been involved with project planning and budgeting from grassroots exploration to mine development. Thompson has worked in Canada, the United States, the Dominican Republic, South America and Asia.
Executive Chairman Nicholas T. Ferris gives a strong financial balance to the team. He has an excellent background in economics and finance at senior managerial levels. Mr. Ferris has very valuable corporate banking experience with Lloyds Bank Canada, and sales and marketing experience with the Canadian Home Income Plan.
Sona itself was started in 1990 under the name Claimstaker Resources and acquired its first property in 1995. Later, Claimstaker changed its name to J-Pacific Gold and more recently to Sona. It currently trades as SYS on the TSX-V. Current stock prices are hovering around the $0.59 cents per share. Today, Sona Resources runs four 100%-owned gold projects in various stages of exploration and development.
One of their most recent projects is the Montgolfier gold project located in northwestern Quebec. They entered into an agreement on the property in 2004 and conducted a series of tests between 2005 through 2008. They have staked claims and taken ownership of those claims in accordance to an agreement with Ressources D. Villeneuve Inc., who retain a 2% net smelter return royalty. Exploration is still underway on this property.
Another joint agreement they entered into in 2004 was on their Nevada-based project, Callaghan. The property has a mining heritage of nearly 80 years and Sona Resources has a royalty-sharing agreement with the previous owner. Sona's 2005 exploration program has helped to identify drilling targets on this property.
These two projects are being developed and have considerable development still to go. Current year goals are for Sona to focus on their two properties based in British Columbia, Elizabeth Gold property and Blackdome Gold property. These are considered to be Sona's flagship properties:
The Elizabeth Gold Property, located about 200 kilometers north of Vancouver, was originally staked in the 1930's and was explored by several parties until Sona acquired the land in 2002. After additional exploration as well as key infrastructure upgrades, Sona reported an initial inferred resource of 522,900 tonnes grading 12.26 grams gold per tonne and containing 206,000 ounces of gold.
Blackdome was Sona's first property. Like the Elizabeth property, it is 100% owned by Sona and its mining history traced back to the 1930's. And, from 1986 through 1991, the mine was run by Blackdome Mining Ltd and produced 225,000 ounces of gold at a grade of 20 grams gold per tonne in those 5 years. The mine was acquired by Sona in 1995 and they upgraded the infrastructure on the site. The mine has a well maintained camp and a gravity and flotation mill.
The plan is for underground mines at both their Elizabeth Gold property and their Blackdome Gold property, with extracted ore trucked to Blackdome's gravity and flotation mill just 30 kilometers away.
In a 2010 presentation published on its website, Sona mines has identified its next steps, which include additional economic assessments and exploration, permitting, and then project initiation by 2013.
On May 4th, 2010 Sona published the upgraded 43-101 resources for the Blackdome Mine at 144,500 tonnes of indicated resource grading 11.29 grams gold per tonne and 50.01 grams silver per tonne and an inferred resource of 90,600 tonnes grading 8.79 grams gold per tonne and 18.81 grams silver per tonne. The indicated resource contains 52,600 ounces of gold and 232,300 ounces of silver and the inferred resource contains 25,900 ounces of gold and 54,400 ounces of silver.
And, on May 5th, 2010, Sona published a Blackdome 43-101 tailings resource estimate of 298,389 tonnes grading 1.47 grams gold per tonne of tailings containing 14,145 ounces of gold.
"This is one more important step toward achieving our goal of commencing full-scale production at the Blackdome mill by 2013," said John Thompson, Sona’s president and CEO.
Mr. Thompson is a Professional Engineer with three and a half decades of mining industry experience, which includes nearly every aspect of mining from exploration and development to acquisitions and joint ventures, negotiations, and management. He has worked in mining operations in Canada, the US, the Dominican Republic, South America, and Asia.
So, why might investors be interested in Sona Resources? There are several reasons:
First, their mines are built on existing mining infrastructure within mining regions. Therefore, they have access to roads, and staff in a way that other more remote mines may not.
Second, each of these mines has a heritage within the mining industry, making them considerably better prospects than the "shot-in-the-dark" exploration that other juniors perform. These mines show some promise and Sona's role is to take them to production.
Third, Sona's 100% ownership in these mines is good news for investors who want to be assured that a majority of revenue generated from these mines will remain with investors.
Fourth, the gold market right now makes it a compelling play for Sona and for investors. Sona knows that gold prices are virtually creating new opportunities in gold. In fact, right on their website they say that they are "Bullish on Gold".
Fifth, and one of the most important elements in our mind, is their realistic and strategic focus and development timeline. Sona knows that the best strategy is to move forward consistently. Their timeline is for production on their two flagship mines in about 3 years.
Sona Resources has the experience and longevity – as well as the properties – to provide metals investors with an interesting opportunity.
References
Sona Resources Corp.
http://sonaresources.com/
Suite 802 - 1166 Alberni Street
Vancouver BC
V6E 3Z3
Tel: 604.684.6677
Toll-Free Investor Relations: 1.888.236.5200