Jim Pettit is very upbeat about the prospects for his gold and silver bearing property in northwestern Ontario. With a little more hard work, and some patience, he believes his project will pay off handsomely for Bayfield Ventures (TSX-V: BYV) and its investors.
The Bayfield saga is well known in Canadian mining circles, but Pettit retells it with some relish. “I think we’ve got a compelling story,” says the CEO.
The story begins with a rebuff in Mongolia. Bayfield was first formed to go after coal mining assets in that far-off land.
The coal was there sure enough, but when local interests caught on to what was happening they launched a legal challenge against Bayfield’s coal properties. The case went to the country’s top court and the litigants won.
It was yet another lesson about the treacherous pitfalls awaiting companies working in geopolitically risky jurisdictions.
Bayfield came home determined to refocus its efforts in more congenial territory.
At the time, another junior exploration outfit, Rainy River Resources Ltd., under then President and CEO Nelson Baker, was eyeing an unexplored swath of swampy and overburdened land, 50 kms from Fort Frances, Ont.
The scuttlebutt was that the area could contain a considerable, and previously unsuspected, gold and silver resource.
Intrigued by the possibilities, Bayfield moved swiftly to secure the mineral rights to three parcels adjacent to the Rainy River claims.
One of the parcels, the Burns Block, is completely surrounded by Rainy River claims.
What was immediately apparent to everyone was that if Rainy River began to delineate a significant gold and silver deposit, efficient mining of the entire ore body would hinge on ownership of the rights to the Burns Block.
Pettit says it’s not a matter of if Bayfield becomes a takeover target, but rather a question of when. Rainy River itself could make a bid for Bayfield, or perhaps the prospects are rich enough to lure a major player to take out both juniors.
Pettit says that drilling results on the Rainy River claims indicate the mineralization there could support a “monster” open pit plus an underground mine producing many million ounces of gold and a wealth of silver.
Meanwhile, Bayfield’s own drilling program has identified two high-grade “shoots” almost identical to those seen in the guts of the Rainy River deposit.
One, on the western edge of the Burns Block, has already shown promising mineralization. But another zone has recently been identified on the eastern fringe of the block and is currently the target of continued drilling. Both zones extend across the borders into Rainy River territory.
“In some of the pinch folds we’ve hit, associated with these high grade zones, we’re running in the multi-ounce range,” says Pettit. One hole in particular — RR12-34 — returned 26.50 metres grading at 8.82 grams per tonne gold and 39.44 g/t silver, including11.60 metres of 17.04 g/t gold and 79.07 g/t silver. This was the best drill interval to date.
“These are the highest grades we’ve seen on the eastern side, higher than anything Rainy River has revealed at their Intrepid zone,” says Pettit.
Bayfield shares, once trading at 60 cents earlier this year, were at 33 cents in late November. But Pettit is determined to keep at least one rig drilling on the Block into 2013.
“The more we can define the mineralization, the more clarity we will have when it comes to the valuation,” he says. “This is a good M&A story with a very realizable end game.”
He notes that Rainy River is due to come out with a feasibility study in the spring of 2013: “It would make more sense to do something before the feasibility study goes out. It would be an improved feasibility study if (their property) didn’t have a hole in the middle.”
Pettit says investors should have plenty of incentive with Bayfield’s low price in order to take advantage of the M&A he sees as inevitable.
“I’ve seen it that way from the beginning,” he says. “There have been bumps along the way that have affected the time line. But it’s still going to happen. The timeline’s just been bounced around.”
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