Opened: 28-Jan-2022
Shares Held at Open: 3,432,000
What does TMR do?
Tempus Resources (ASX:TMR) is an exploration company focussed on gold in Canada and Ecuador.
What is the macro theme?
Gold is considered a safe-haven asset that performs well when the overall market sentiment is negative.
Historically the gold sector outperforms other asset classes in times of increased volatility (i.e bubble crashes, Inflation or geopolitical tensions).
With inflationary pressure popping up all over the world and heightened geopolitical tensions due to supply-chain issues. We think that gold serves as the perfect hedge against an unexpected economic shock occurring.
Our Big Bet for TMR
TMR becomes a gold producer following the discovery of enough new gold sources to justify the restart of its onsite gold mill.
Why did we invest in TMR?
Fast Pathway to production
TMR’s Canadian assets have had historical production of over 230,000 ounces and comes with a fully permitted mine. The project also has existing processing infrastructure in place so any new discoveries can be quickly put into production, especially if the gold price goes on a run.
Location
TMR’s Gold project in Ecuador is a nearology play, the asset sits adjacent to CA$2.6B capped Lundin Gold’s Fruta del Norte project. A discovery here could lead to a positive re-rate in the TMR share price.
Capital structure
Company highly leveraged to new discoveries with only 125M shares on issue. With a market cap of $15M and $4.3M in cash TMR has an EV of ~$10.7M.
What do we expect TMR to deliver?
Objective #1: Make new discoveries at the Canadian gold project.
Milestones
Drilling program commencement
Drilling results
Objective #2: Upgrade the JORC resource at the Canadian gold project.
We want to see TMR complete another round of drilling at the Blue-Vein discovery both infill and extensional. Off the back of these results, we want to see TMR upgrade the JORC resource for its Canadian gold project.
Milestones
JORC resource estimation commenced
JORC resource completed
Objective #3: Re-start exploration at the Ecuador Gold project, and identify drill targets.
Milestones
Soil sampling works completed
Drill targets identified
What could go wrong?
Exploration risk
TMR has no established economic resource, this means the company is dependent on a new discovery being made to make it economically feasible to get its assets into production and producing cash flows. If a new vein or mineralised system is not found at its Canadian project then the project may become stranded.
Financing risk
TMR is doing high-risk high-reward exploration drilling which means they need access to capital that is willing to finance this type of exploration. TMR is heavily reliant on good market conditions and positive sentiment in the gold-space.
Commodity risk
Gold is a commodity that shines in periods of market volatility & negative sentiment. This doesn't happen often and when it does it can be for a very brief period.
Ecuador country risk
In late-2021 a federal election meant a more mining friendly government came into power in Ecuador but there is still a risk that the government and regulators look to make structural changes to the mining industry. The mining industry needs a stable geopolitical environment given it requires long-dated capital investment, there is a risk the government makes changes that deter capital investment and/or make projects uneconomic to explore/mine.
What is our investment plan?
The TMR share price took a beating in the last quarter of 2021, being sold off from its August 2021 high of 29.5c to be now trading at around 12c.
This has been disappointing for us and a lot of long term investors - we have been holding TMR for almost 2 years now, and have not sold a share. Our average entry price is ~18c across four separate investments.
Hitting our above objectives this year combined with a positive gold price should see TMR’s share price re-rate, given the low number of shares on issue (~125M). In 2022 we will look to sell about 20% of our holding if TMR trades above 30c.
Disclosure: The authors of this memo and owners of Next Investors, S3 Consortium Pty Ltd, and associated entities, own 3,432,000 TMR shares at the time of publication. S3 Consortium Pty Ltd has been engaged by TMR to share our commentary and opinion on the progress of our investment in TMR over time.
TMR announces new Canadian lithium projects
Sep 21, 2023
Sep 21, 2023 |
11 min
Our investment, Tempus Resouces (ASX: TMR), is now pivoting to lithium exploration in Manitoba, Canada, by acquiring options on historically overlooked pegmatite cores. All while maintaining exploration interest in its other Canadian gold projects.
TMR intercepts 28.1g/t of gold over a 28.5m, thickest vein we've ever seen
Jan 9, 2023
Jan 9, 2023 |
11 min
Our junior gold exploration Investment Tempus Resources (ASX: TMR) just put out the strongest single drill result we have seen from its Canadian gold project since we first invested.
TMR’s gold project visualised in 3D
Nov 15, 2022
Nov 15, 2022 |
8 min
Our long held junior gold exploration Investment Tempus Resources (ASX: TMR) recently completed its 40-hole 2022 drilling program. To help us understand what we are looking for with TMR, we created a 3D model using TMR’s publicly available drillhole information.
TMR record breaking drill hits - another step to restarting dormant gold mill
Sep 19, 2022
Sep 19, 2022 |
7 min
This morning TMR released assay results that included 310.72g/t gold over 1.05 metres from a depth of only 105.12 metres. Inside that intercept, TMR also hit a higher grade zone measuring 1,572g/t over 0.2m. This is the highest grade intercept EVER made at its Canadian gold project - eclipsing their previous high of 523g/t announced just a few weeks ago.
TMR announces potential new “Layer of Icing in the cake”
Aug 16, 2022
Aug 16, 2022 |
7 min
Our junior gold exploration Investment Tempus Resources’ (ASX: TMR) has hit multiple sections of visible gold with its first drill holes at a previously mapped (but unexplored) vein.
TMR’s maiden JORC resource now due in August/September
Jul 28, 2023
Jul 28, 2023 |
2 min
Our Canadian gold exploration Investment Tempus Resources (ASX: TMR) just put out a project update.
TMR outlines its plans for 2023 - Resource in June, drilling in
Jun 5, 2023
Jun 5, 2023 |
2 min
Our Canadian gold exploration Investment Tempus Resources (ASX: TMR) just detailed its 2023 exploration program.
TMR completes $2.5M capital raise - Maiden resource next.
May 15, 2023
May 15, 2023 |
2 min
Our gold investment, Tempus Resources (ASX: TMR), has just raised a further $2.5m to continue it's drilling and exploration program in Canada.
Final assays from 2022 drill program - JORC resource next
Feb 20, 2023
Feb 20, 2023 |
55.7 seconds
Review of TMR’s 2022 exploration program
Jan 31, 2023
Jan 31, 2023 |
1 min
Upcoming Catalysts for some of our companies. Plus some lessons learnt.
Dec 2, 2023
Dec 2, 2023 |
13 min
In this Weekender, we look at some of our portfolio companies that have major catalysts due in a few weeks, as well as a couple of our fails in the stock market over the years. Small cap stocks need time to work on projects, and this can often result in groundbreaking positive outcomes, or totally epic fails. Let's dive in.
Market Cycles and how we invest
Jul 9, 2023
Jul 9, 2023 |
11 min
In this edition of the Weekender, we discuss the various seasonal stock market cycles we see year around. From selling in May, and tax loss selling in June recently, we look at how the cyclical nature of markets may present new investment opportunities to investors.
The stocks hit hardest by tax loss selling
Jun 17, 2023
Jun 17, 2023 |
12 min
Here we are, the final two weeks of June tax-loss selling. Those wanting to exit a stock and holding out for newsflow or a liquidity event are probably getting to the point where time is running out.
Weed and gold, the unloved investment thematics
Oct 22, 2022
Oct 22, 2022 |
13 min
We have all seen when a new investment theme goes through an initial period of hype, the peak of inflated expectations and then the trough of disillusionment. Today we will look at how this hype cycles affects to investment themes we are closely watching for 2023: Weed and Gold
Following a company's progress and why context matters
Aug 20, 2022
Aug 20, 2022 |
13 min
There is a rush to find new sources of traditional commodities like natural gas, oil, iron ore, copper and nickel as the global economy decouples and countries seek to localise resource supply.
