Now Is the Time To Start Exploration Projects To Capitalize On Turnaround In Gold

(Kitco News) - Now is the time to spend money on exploration programs so companies will be prepared when prices turnaround, says one junior mining executive, who is putting those thoughts into practice.

Brad Kitchen, chairman and CEO of Secova Metals Corp (TSX.V SEK), said in a recent interview with Kitco News that the company is embarking on a fairly aggressive exploration plan at its Duvay property in Northern Quebec.

Secova started its winter exploration program at the beginning of February and plans to spend around $500,000 on surface exploration and 3,250 meters of drilling.

“Other exploration companies are waiting for the market to change and then they are going to raise cash and start their exploration programs. We are already ahead of the game and that is important because when the market changes, it changes pretty fast,” he said.

The gold market is already seeing a dramatic shift, as push above $1,200 an ounce Monday, showing a gain of more than 16% for the year. Being a Canadian-based project, Secova can also boast that gold in Canadian dollar terms has risen even more dramatically, trading above C$1,700 an ounce.

“We believe Secova has a huge advantage over other gold exploration companies as we advance the gold exploration at Duvay while others sit idle,” he said.

Secova’s philosophy-- of spending money to make money -- appears to be paying off as the company, in these cash-strapped times, has managed to raise $1.2 million from various investors since December, including raising a first tranche of private placement financing worth $425,000.

Kitchen explained that the company’s winter exploration program will help confirm some of the property’s historical data. He said that public records indicate previous exploration showed resources of around 400,000 ounces of gold.