Carson Bullock in Muddy Waters Capital on CNBC’s Delivery Alpha, September 28, 2022.
Scott Mullin | CNBC
Muddy Waters Capital’s Carson Block, known for his short selling campaign, took an unusually bullish stance at the Thorne London Investment Conference on Wednesday, touting the junior miner. snow line gold It has been cited as a top acquisition candidate in the mining sector.
Snowline, valued at about C$2.1 billion, has made what Block called a “first-of-its-kind” discovery in Canada’s Yukon Territory, an area of historically limited production but vast geological potential, he said. The company manages large land packages in emerging areas, and Block said it may eventually host new multi-deposit gold camps.
The focus is on the Rogue Project’s Valley deposit, which holds an estimated 8 million ounces of gold in measured and indicated categories at an average grade of 1.21 grams per tonne. There are other exploration targets at Snowline, but the Valley is likely to be the asset that will attract the attention of large producers facing declining reserves, Block said.
“This is one of the few assets globally that can move the needle for a mid- or large-cap gold mining company,” Block’s presentation document said, calling the company an “elephant.”
Block expects Snowline to be acquired within the next three years. If the deal closes in the next 12 months, he sees a potential valuation of C$4 billion to C$6 billion, suggesting the price could rise further if drilling continues.
“The longer it takes to buy this asset, the higher the price will be,” he said.
Snowline stock has soared more than 10 times since early 2022, when the company drilled its first discovery hole in the Valley. Still, Block argued that the inventory still did not reflect the strategic value of the resource in an increasingly consolidated mining industry.
Canadian publicly traded stocks soared more than 6% after Block’s remarks.
Carson Bullock will appear on “The Exchange” with CNBC’s John Fort at 1 p.m. ET.
