Midas leading the pack of Idaho gold explorers

Just six months after completing its $45.2-million initial public offering in July, Midas Gold (MAX-T) has firmly emerged as the top gold explorer in Idaho following the state’s recent resurgence as a prospective mining jurisdiction.

Having established a 5.8-million-oz. gold resource last year at its flagship Golden Meadows project in Idaho’s Valley County, Midas has started 2012 with a bang – initiating a US$17-million work program in the year’s first half.

The program will see Midas carry out 17,000 metres of drilling before mid-year, including definition, step-out and exploration drilling, as well as complete a preliminary economic assessment (PEA) by September. The study will use an updated mineral resource estimate that Midas expects to finish in the second quarter, based on the current drill program and last year’s results.

The previous estimate in June outlined three deposits containing 40.8 million indicated tonnes averaging 1.58 grams gold per tonne and 54.1 million inferred tonnes averaging 2.14 grams gold. Midas says much of the work going into the PEA is being done to prefeasibility standards, reducing the time frame for Golden Meadows’ next development stage.

Despite the market downturn, Midas’ success helped raise its share price from $3.25 at the time of its IPO to a $4.80 high in November 2011. At presstime on Jan. 12, 2012, Midas’ 105 million outstanding shares traded for $4.30 apiece, valuing the company at $480 million.

The valuation places Midas in a league above the dozen Canadian-listed companies exploring for gold in the northwestern state, most of which trade for less than 25¢ a share.

Among Midas’ competitors with projects in Idaho, Northern Vertex Capital (NEE-V) and Marathon Gold (MOZ-T) have had the next-best year in terms of stock performance. Northern Vertex’s shares last traded for $1.45 on Jan. 12, up from 50¢ this time last year following drilling at its Moss gold-silver project in Arizona, and optioning a 75% interest in the Lemhi gold project near Salmon, Idaho. Northern Vertex has agreed to pay US$9.5 million in stages for the interest to a private company named Idaho State Gold, which consolidated four contiguous properties to form Lemhi, including the Humbug gold deposit formerly owned by Yamana Gold (YRI-T, AUY-N). It plans to spend US$7.7 million over the next 18 months on a multi-phase infill drilling and resource confirmation program at Lemhi.

Marathon Gold last traded for $1.10 on Jan. 12, down from a high of $1.80 in February 2011. It is completing a 10,000-metre drill program at its historic Golden Chest gold project in northeastern Idaho, and has plans for another 25,000 metres this year. After completing a small amount of underground mining at Golden Chest several years ago, Marathon is looking into the project’s open-pit potential and completing more than 40,000 metres of drilling at its main gold projects on the island of Newfoundland.

At 31¢ a share, Western Pacific Resources (WRP-V) plans to drill 30,000 metres this year at its Mineral Gulch gold project in Idaho’s historic Black Pine mining district. Its shares are down from 69¢, with the best intersection from 2011 returning 1.6 grams gold over 24 metres.

Terraco Gold (TEN-V) and Otis Gold (ooo-v) follow close behind at 23¢ and 21¢ a share, respectively, while Premium Exploration (pem-v) lags at 14.5¢ a share.

Atlanta Gold (ATG-V), Thunder Mountain Gold (thm-v), Velocity Minerals (vlc-t), Azteca Gold (azg-v) and Nubian Resources (nbr-v) all have gold properties in the state, and have recently traded at or below the 10¢ level.