As this long-term secular bull market for gold and silver continues to march onward, truly major moves from the sector's hottest growth stocks are simply bound to characterize the trend.
Although this company has yet to reach the profitability promised land represented by the key transition from explorer to producer, as a proven locator of substantial gold deposits, Fronteer blazes a trail all its own. Whereas comparably successful explorers like Rubicon Minerals
My Foolish colleague Toby Shute has called Fronteer's Long Canyon project "America's Next Top Mine," which is some title for a deposit with only 672,000 ounces in indicated gold resources. Rather than the project's scale, however, Toby correctly honed in on the project's uncommonly robust economics. Even back when $800 was considered a reasonable gold price assumption, Fronteer targeted a payback period of just 1.3 years. At $800 gold, the project's internal rate of return (IRR) was already estimated at a slam-dunk 64%!
Meanwhile, the notional scale of the Long Canyon asset continues to expand, thanks to phenomenal exploration results like the 12.3 grams of gold per ton encountered across a massive 50.4-meter interval in one recent drill hole. Fronteer expects to release an updated mineral resource for Long Canyon early in 2011, and an updated preliminary economic assessment (PEA) thereafter. I expect Long Canyon to grow -- well -- longer still.
Also in the mining-friendly state of Nevada, Fronteer's Northumberland project boasts a 2.44 million-ounce indicated gold resource in its own right, and here again recent drilling results continue to impress. At its Sandman project, Fronteer brought Newmont Mining
In Turkey, Fronteer holds a 40% interest in a joint venture with Teck Resources
I remain long-term bullish on multiple gold explorers within the new Global X Gold Explorers ETF