Noble Capital has started coverage of Great Bear Resources Ltd (CVE:GBR) (OTCQX:GTBAF) (FRA:0G6A) saying that its Dixie Lake project in Red Lake is a district-scale gold discovery with potential to become one of the world's few Tier 1 gold mines.
The broker rates the stock 'Outperform' and targets C$26 or US$21 per share. Great Bear shares in Canada were changing hands at C$14.57 and in New York for US$14.56 on Thursday.
READ: Great Bear Resources extends area of continuous gold mineralization at LP Fault, Dixie project by 25%
"Tier 1 gold mines are generally defined as those that produce at least 500 thousand gold ounces per year, a mine life exceeding 10 years, and costs in the lower half of the industry cost curve," said Noble analysts.
"Based on drilling results over the life of the project, we estimate mineral endowment potential of at least 10.0 million gold ounces with significant growth potential. While Great Bear is preparing to be able to advance the project into production, we think the company is a promising candidate for acquisition by a senior or intermediate gold producer," they added.
The Noble analysts also highlighted the firm's 2020 presentation by the Canadian Institute of Mining, Metallurgy and Petroleum the A.O. Dufresne Exploration Achievement Award in recognition of "the knowledge, vision, and dedication in discovering and developing the Dixie Project as a world-class deposit".
The analysts also noted that the company's activities are fully funded into 2022 and that it benefits from experienced management.
"Catalysts for the stock include continued positive drill results that better define existing zones and step-out drilling to expand the existing zones and to discover new ones, along with publication of a maiden resource estimate in late 2021 or early 2022 and subsequent preliminary economic assessment," they added.
The company's wholly-owned Dixie project comprises 9,140 hectares of contiguous claims that extend over 22 kilometres (km). It lies around 25 km southeast of the town of Red Lake, Ontario.
Contact the author at giles@proactiveinvestors.com