My Interview With A Multiple $500M - $1B Mine Builder - This Is His Next Deal
I spent over an hour on the horn with Marc Levy, CEO of Norsemont Mining (CSE: NOM, OTCQB: NRRSF) - Here's the scoop.
The “20 second” breakdown was provided to our Premium subscribers last week, and they’ve enjoyed a 14% pop since. Here’s the full report.
Need to Know in 20 Seconds: Norsemont Mining (NOM)
• Former producer with infrastructure: Chile's 3rd largest gold producer in the 90s, Shell extracted 380k oz before walking away
• Management with several successful blue chip mining exits: CEO Marc Levy sold Norsemont 1.0 for $520M (2011), Petaquilla for $350M, founded Aurora Cannabis unicorn
• $9M skin in the game: Levy family owns 28% of company with hard cash invested alongside shareholders
• Fast-track to production: 210k oz in waste dumps can produce $525M profit for $65M investment within 2 years
• Massive valuation gap: Trading at $16.67/oz vs industry standard $50-150/oz for near-producers with infrastructure
• Resource growth potential: 2.74M oz resource only covers first 70 meters, targeting 7-9M oz total
• Copper porphyry discovery: Found what Rio Tinto missed using newer technology, hit 1% copper grades
• Bulletproof permits: Presidential decree overrides future legislation, community fully onside
• Proven copper belt: Northern Chile connected to southern Peru where Levy's previous $2.5B Constancia mine sits
• Gold at $3,200+: Project profitable even at $1,650 gold with $500/oz oxide production costs
I had the pleasure of spending an hour speaking with Norsemont CEO Marc Levy.
I believe we are looking at a sorely undervalued situation, coming out of hibernation following a brutal metals bear market over the past few years.
Norsemont Mining (CSE: NOM, OTCQB: NRRSF) just dropped their updated mineral resource estimate in April. The numbers tell a story that every precious and base metals investor needs to know about.
2.74 million gold equivalent ounces across indicated and inferred categories.
The kicker is not only where this sits, but the fact that they are poking into what looks to be a major copper porphyry which drove the gold mineralization to the surface.
Yeah, it’s big.
The Choquelimpie Advantage
Choquelimpie was Chile's third-largest gold producer back when Shell ran it in the late 80s and early 90s. They pulled 380,000 ounces of high-grade gold before walking away.
The infrastructure reads like a mining executive's wish list: 3,000-tonne-per-day mill already on site, power connected, water permits secured, year-round road access, and a fully equipped camp.
The project has over 1,700 drill holes and 140,000 meters of drilling data. "If we had to go back and drill all that, it would probably cost us about 50 million bucks to execute that program," CEO Marc Levy told me.
The Quiet Years Are Over
Like most junior miners, Norsemont kept their heads down during the brutal gold bear market. "We were quiet for the last three, four years because the markets were so tough and we were just trying to maintain the project," Levy explained on our call. "Now we've come out of the shute here."
Their stock hit $2.85 in 2020 "before a resource estimate, before we had drill results out." With gold now trading well above $3,200, the timing for their reemergence couldn't be better.
Management with Billion-Dollar Track Record
Levy and his family have $9 million of their own money invested. "My family, myself, we own about 28% of the company. We've paid about 9 million for that stake hard dollars out of our pockets."
His exits speak volumes. "I sold Norsemont 1.0 for 520 million in 2011," targeting the Constancia copper project that "Hudbay owns, which is a two and a half billion dollars mine now." He also sold Petaquilla Minerals to Inmet Mining for $350 million and founded Aurora Cannabis, the unicorn that exploded from his 2013 investment.
The leadership team includes mining heavyweights.
Michel Thiele "drilled the first hole on Esperanza and six years later it's in production for $2.7 billion major copper gold project."
Dr. Sergey Diakov is a "copper porphyry expert helped discover Oyu Tolgoi, one of the largest copper porphyries in the world."
Most intriguingly, David Laing ran companies worth billions. "This is his baby, we acquired it, knocked on his door, said, Hey, we need your help. We have your baby that you put into production back in the early days for Shell."
Resource Quality and Community Support
The 2.74 million ounce resource breaks down to 80% indicated and 20% inferred.
About 20% is oxide material that's easily liberated and leached cost-effectively. They've got three leach pads already on the project for fast-track production.
The community situation is rock solid. "We've got the community on side, the government on side, the indigenous people on side," Levy explained. The property owner's only request? "We hire her grandchildren, her children, which is really the young men of the community, the 30 40-year-old men that need a future."
The Fast-Track Production Story
Here's where this gets compelling.
They've identified 210,000 ounces sitting in waste dumps that can be put back into production for about $65 million. At current gold prices, that delivers $525 million in gross profit within two years.
Another 350,000 ounces of oxide material needs crushing through their existing mill. Production costs run around $500 per ounce for oxides versus typical sulfide costs of $1,000-$1,500.
The project economics work even in a downturn. "When we first started the project, I think gold was sitting at about $1650. I believe at that point this project is profitable," Levy said. With special tax credits in their region, "if we built a $300 - $400 million plant and getting back a hundred million dollars tax credit, that goes to your bottom line."
The Resource Growth Story
That 2.74 million ounce resource only covers surface mineralization. The high-grade intercepts tell a bigger story. "You can see some pretty two meters of 340 grams of gold, two meters of 128. There's some pretty crazy shallow small intercepts but crazy grades and obviously 160 meters of almost four grams of gold and 200 gram silver."
But here's the key: these intercepts end in mineralization, meaning they can go deeper. Levy's targeting "tripling or quadrupling the size of the deposit by going down at depth."
The Copper Porphyry Discovery
This is where the story gets explosive.
"What's missing from this graph is some of these holes have encountered 0.75 and 1% copper, which leads us to believe that copper porphyry is in that whole zone and it should be a large copper porphyry."
Rio Tinto tried to find it in 2007-2008. "Rio Tinto drilled 3000 meter holes into the project and our project, they didn't hit," Levy explained. "We did some surveys and we found some magnetic anomalies because there is newer technology invented in 2010 that can go down a thousand meters to go down deeper than what Rio could."
The result? "We believe we've found our, well, we know we've found our copper porphyry, so we just have to figure out what the size is and we know the grades because we drilled into part of it and encountered 1% and 0.75 copper."
Choquelimpie is in northern Chile, which is connected to Southern Peru – where all those large billion dollar copper deposits live, including Levy’s own Norsemont 1.0 baby Constancia.
Dr. Diakov joined after "reviewing our data and saying, Hey, you got your porphyry."
The Valuation Disconnect
At a $45 million market cap, Norsemont trades at just $16.67 per gold equivalent ounce. "There are some people that put out reports saying we're the third or fourth cheapest gold stock out there with an actual resource and a pathway for growth and production."
Their three largest shareholders "have share targets that are in excess of where we're trading at today by a factor of 10 or more."
The Financing and Vision
They're currently in the process of securing financing led by strategics in South America, Europe and the US. Several institutions and mining companies are "in our data room reviewing data, looking to potentially support us and fund us through to production or feasibility situations."
Levy's goal is clear: "Build this thing out and either create a billion plus dollar exit for me, my family, my shareholders, or be in a cashflow situation where we become a mid-tier producer and generate cashflow and generate dividends."
My Take
In 30 years of watching this sector, I've rarely seen a combination like this: proven management with billion-dollar exits, existing infrastructure, clear path to production, and massive resource expansion potential sitting above what could be a world-class copper porphyry.
With gold above $3,200 and management putting their own millions on the line, this disconnect won't last forever.
This analysis is for informational purposes only and does not constitute investment advice. Junior mining stocks carry substantial risk, including potential total loss of investment. Conduct your own due diligence and consult qualified professionals before making investment decisions.