Potential Second Gold Rush In Canada's Yukon Could Bring Rewarding Mining Plays: report
A potential second gold rush in Canada's Yukon territory could provide investors with some rewarding mining plays, a manager for Dalton Strategic Partnership's Melchior natural resources fund is cited on Reuters as saying.
More firms are raising capital to expand summer drilling programs in the Yukon said Marc Sontrop, a portfolio manager for the $69 million fund, which is overweight precious metals.
"We have seen some majors move in and the exploration dollars going in are said to be about $300 million, versus $30 million about five years ago," he told Reuters.
The fund was up 36% in the 12 months to end-May, according to Lipper data, and outperformed its peers in the Lipper Global Natural Resource Equity sector by 13 percentage points.
Sontrop said interest in the Yukon had picked up because of discoveries in the last three years by the likes of Underworld Resources, Kaminak Gold (KAM.V) and Atac Resources.
Sontrop added that senior gold mining companies are becoming increasingly involved in the region, pointing to Kinross (K.TO) buying Underworld in 2010.
Strategic Metals (SMD.V), which forms 4.4% of the fund, has over 150 projects in the Yukon. Sontrop said it has a strong management team, and stakes of 10-25% in a number of juniors with exploration projects of their own.
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