latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/s2-resources-sees-golden-opportunities-in-finnish-prospect-nevada-projects-53685035 content esgSubNav
In This List

S2 Resources sees golden opportunities in Finnish prospect, Nevada projects

Blog

Insight Weekly: US stock performance; banks' M&A risk; COVID-19 vaccine makers' earnings

Blog

Insight Weekly: LNG exports surge; investors unfazed by inflation; neobanks drive VC funding

Blog

Essential Metals Mining Insights November 2021

Blog

[Infographic]: 2021 World Exploration Trends


S2 Resources sees golden opportunities in Finnish prospect, Nevada projects

S2 Resources Ltd. sees upside opportunity around the potential gold discovery at its Aakenusvaara project in Finland and in Nevada, where CEO Mark Bennett said the company is assessing more gold projects from a plethora of juniors approaching it for partnerships.

S2 said Aug. 19 that numerous zones of sulfides, alteration and brecciation from 5 meters to 15 meters thick were intersected in all of the first seven diamond holes it drilled downdip and along strike from historical gold intercepts at the Aakenusvaara gold prospect S2 was granted in July.

While assays are still coming, S2 said the intercepts are visually similar to those in limited historical near-surface drilling undertaken by Outokumpu Oyj, which discovered the gold prospect in the 1980s when it drilled 33 holes.

SNL Image
S2 Resources CEO Mark Bennett
Source: S2 Resources

Bennett said in an interview that Aakenusvaara will immediately jump to the top of S2's portfolio priorities among its other Australian and Nevada projects if the gold assays confirm what initial drilling has suggested.

Aakenusvaara also lends itself to drilling many more holes to rapidly increase its size, which is what the company and its shareholders prefer, Bennett said.

Many of those shareholders came on board when S2 was spun out of Bennett's former company, Sirius Resources NL, when Independence Group NL acquired Sirius for A$1.8 billion in 2015.

Bennett said that while S2 started in the position of having "happy shareholders" who profited from Sirius' famed Nova nickel-copper-cobalt discovery in Western Australia, they were keen for the company to find another big deposit.

This led S2 to Finland, which had been underexplored but clearly has potential for major deposits as it hosts Anglo American PLC's Sakatti nickel-copper-platinum discovery, whose 40 million-tonne resource at about 3% combined nickel and copper dwarfs Nova's 15 million-tonne resource with roughly the same grade.

While fund managers with knowledge of international exploration tend to understand S2's foray into Finland, Bennett said he still gets questioned from brokers and retail investors about the country's environmental sensitivities and mining history, despite both factors being strong positives for the company.

Though Finland's regulations are considered friendly to mining, the Central Lapland Greenstone Belt that hosts Aakenusvaara has not been extensively or effectively explored.

S2 effectively owns a third of the belt, which also hosts Sakatti and Agnico Eagle Mines Ltd.'s 9 million-ounce Kittila gold mine, Europe's largest primary gold-producing asset.

Growth opportunities

While S2 will not look at more assets in Europe for now, Bennett said it has been approached by many microcaps that have pegged prospective ground and created targets but lack the funds to drill them.

SNL Image
Drilling at Aakenusvaara
Source: S2 Resources

For such companies, S2 is a more attractive partner than majors that generally end up with 100% of the project and give a royalty to the junior that found it, Bennett said.

Sirius is in a unique position for a junior with A$13.5 million in cash and investments and the backing of Sirius' major investor, prominent West Australian prospector Mark Creasy, who is S2's largest shareholder with 29.5%.

London institutional investor Merian Global Investors, formerly Old Mutual Global Investors, also bought all of its 9.4% holding in S2 on-market.

Thus Sirius has the luxury of offering itself as something of a "niche" opportunity by offering local juniors a 30% stake so they get immediate upside in Nevada, which Bennett believes still has plenty of greenfields opportunities ignored by the majors in the area.

S2 has such an arrangement with Renaissance Gold Inc. at the Ecru gold project north of Barrick Gold Corp.'s giant Cortez gold mining complex, composed of a number of individually significant gold deposits.

"Not far from some big gold mines in Nevada you have open ground with targets which generally get picked up by microcaps, but there are very few junior explorers there as Canadians listed on the [TSX Venture Exchange] can only spend their money in Canada due to the flow-through funding scheme," Bennett said.