Muddy Waters Research founder Carson Block said Wednesday that he has taken a long position in Canadian junior miner Snowline Gold Corp. (TSXV: SGD) — a striking shift for the famed short seller.
At the Sohn London Conference, Block argued that Snowline’s Yukon‑based assets, notably the Rogue Valley Deposit, which he estimated holds around 8 million ounces of gold, are undervalued compared to current gold prices. He said the company has taken a “conservative approach” to its growth projections, which bolsters his confidence.
Block added, “We think this project works at $1,800 gold and don’t see much downside risk here at the price.” He noted gold was trading at about US$4,070 per ounce, nearing record highs.
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Block’s public long position dramatically departs from his usual strategy. He’s made a name for short-selling overvalued or suspicious companies. His bullish bet could lend Snowline added credibility in the junior‑miner space, a sector often viewed as risky or speculative.
A recent preliminary economic study completed by Snowline on the Rogue project outlined an $8.3 billion net preent value at US$3,600 an ounce gold, which was based on average annual production of 341,000 ounces of gold over a 20 year mine life, with initial capex of just $1.7 billion. All in sustaining costs are estimated at US$844 per ounce over the life of mine, while project payback is estimated at 1.9 years.
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