Kiboko Gold (TSXV: KIB) is a junior mining exploration company focused on one of the most prolific gold-producing regions of the world, the Abitibi Gold Belt. Located an hour away by drive from Val-d’Or, the company owns the Harricana Gold project. Strong from its 102 Km2 land position, Kiboko shared updates on the drill program underway. Valued less than $10M, the company can reward a significant return on investment in the long run.

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Kiboko Gold Overview

Kiboko Gold (TSXV: KIB) is a junior mining exploration company owning the Harricana project. This project gathers 234 claims covering 102 Km2, and 230 claims are 100% owned with an option to earn 100% on the remainder. Historical records took place there, and geological mapping, geophysics, geochemistry, numerous bulk samples, and assay data from 937 diamond drill holes totaled 139.397m. This project is situated nearby operating mines, with excellent access and proximity to existing infrastructure. It includes road, rail, and hydroelectric grid power. Kiboko reported in late November that it had completed 7,121m of drilling over 48 holes since mid-September, and assay results are pending. The Phase is expected to see a total of 11,000m drilled over 67 holes. Several holes initially planned as part of Phase 1, totaling approximately 1,400 m of drilling, have been deferred or will no longer be drilled due to rugged topography. Because of laboratory staffing issues, delays will take place and extend Kiboko’s timeline for completing the Phase 1 exploration program to the second quarter of 2023.

A solid piece of information is the project is entirely founded. The budgeted cost of the Phase 1 exploration program, as outlined in the May 2022 Harricana Technical Report and based upon January 2022 quotes, was $2.7 million, which included 12,450 m of drilling over 82 drill holes. The revised Phase 1 exploration program, planned to have 11,000 m of drilling over 67 holes and an updated technical report, is expected to cost approximately $4 million and be funded from existing working capital.

Phase 1 is to verify a significant portion of the 79,565m of historical Fontana area drilling. The near-surface exploration targets for the Fontana area of the project total 13.6M to 23,1M tonnes at a range of grades from 3.0 to 3,4 gpt. The company is also a new-era type of mining company. ESG-focused, Kiboko is committed to hiring and contracting locally whenever possible and protecting the environment during its exploration activities.

“Kiboko has made tremendous progress advancing the Harricana Project since completing its upsized IPO just a few months ago. Shortly after being granted drill permits in late August, and despite tight labor markets, Kiboko was able to attract a skilled field team to execute our drill program. Our team has drilled 48 holes totaling more than 7,000 meters over the past two months, which has generated an enormous backlog of samples that we are waiting to be processed. These assay results are expected to generate significant news flow as we work towards our target of reporting a maiden mineral resource in the second quarter of 2023.”

Jeremy Link, CEO.

Share Structure/ Financials

Kiboko holds a solid share structure for a junior mining exploration company. Only 44M shares are issued and outstanding. 3.4M options are available at an exercise price of $0.20 and are available until July 2027. 25.2M warrants are accessible, with 0.95M warrants at $0.40 until June 2023, 18.8M at $0.40 until June 2027, and 5.5M at $0.45 until June 2027.

The most exciting data can be found in the shareholder analysis. The float only accounts for 25.8%, and it will please investors as a small float leads to broader fluctuations in the stock price. IR Battery and Processing own 8.6%, Tres-Or Resources holds 13.6%, institutional investors detain 17.5%, and the Kiboko management and board gather 34.6%. It is good to mention the board also invested $449k in the IPO.

Kiboko has $4.2M in cash, for $1.8M in total liabilities, primarily due to the flow-through share premium liability ($1M). The company spent $1.4M over the previous quarter, and $1.1M accounted for exploration and evaluation. It positively augmented with the 67 drill explorations. At this pace, the company can last 3 more quarters without financing.

Since its IPO in early July 2022, the stock price kept declining until November, when it found its bottom at $0.14. Initially traded at $0.25 when introduced on the TSXV exchange, KIB holds the line at $0.14. Hypothetically, we could expect an increase in the stock price from positive assays from its drill program and from a general positive investor sentiment that many believe will occur during the first part of 2023.

Bottom Line

Kiboko Gold (TSXV: KIB) is a junior mining exploration company with high potential. The Harricana project has the potential to be a multi-million-ounce opportunity in one of the world’s top jurisdictions. The company can entirely fund its project, and Kiboko’s balance sheet is solid. The company is undoubtedly severely undervalued, but positive assays could bring some light and reverse the declining stock price.

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