Angkor Resources – An Attractive Resource Play to hedge against your high inflation

angkor resources

There has been a big shift in investor sentiment these past year as the share prices of growth stocks start to cool down as people get weary of their high valuations.

In contrast, investors are going more downstream – into the commodity stocks that help to hedge against the soaring inflation.

While there are plenty of resource plays like agriculture or mining companies, there is one interesting small company out of Canada that has its primary operations in Southeast Asia – Angkor Resources Corporation (“Angkor” in short). It is trading on the TSX Venture (TSXV) with the symbol ‘ANK.V’.

Angkor Resources stands out for their 10+ year track record and their cashflow focus in the short term. On top of that, we can find 3 reasons to invest in Angkor Resources:

1. A Steady Cashflow Project in Western Canada set to Begin Producing Later this Month

In the middle of the Canadian Prairies lies a small settlement called Evesham, Saskatchewan. What’s exciting is that Angkor got their hands on a Gas Recapture project based there which will

  • be good for the environment, and
  • provide the company with welcome cashflow.

CEO Delayne Weeks has made it her mission to create steady income for the company, and this is one of the first projects to do that.

angkor gas recapture

Their newly installed compressors can accommodate up to 3 million cubic feet per day with a field of 29 oil wells via their underground pipelines. The company can then resell all the clean natural gas to homes across the Canadian prairies.

This project is expected to earn between a range of $30k – $150k CAD per month, depending on the fluctuation of the gas prices.

The price of natural gas has been steadily climbing, thanks in no small part to the unfortunate conflict in Ukraine. The recent high gas prices of around $7-$8.50 bodes well for Angkor as it expects revenue to kick in by the end of May 2022.

2. A Sand Dredging and Gold Recovery Project in the Philippines is Starting this Summer

While Angkor has several gold and copper projects in Cambodia, the neighboring nation of the Philippines has grabbed much of the attention as the firm prospected a large alluvial gold deposit located in Filipino river sand.

After enduring Covid delays, Angkor is restarting a sand dredging and washing operation along the Malaguit River east of Manila. Not only is the estimated 17 million square meters of sand in high demand for construction projects around the country, but the permits provide the Contractor dibs on any gold they find in the process.

In other words, the business is based on sand sales with an upside for gold recovery as a bonus – pointing to a low risk – high reward opportunity there.

Historical data indicates the river sits on a well-known gold-bearing plain.  Past assays taken on the river show a return average of 0.05 – 1.8 gpt of gold.  They want to remove a minimum of 1500 cubic meters (or 2400 tonnes) of sand daily.  Even if they recover 10% of what assays show, over 1900 grams of gold would be a healthy upside for everyone.

Angkor is currently rebuilding the dredging and washing plant and importing new equipment to expand operations. They expect things to be ready in the next few months.

With millions of cubic meters of sand to be cleaned out of the river, and long-term sand buyers in place (construction contractors for the Filipino government), the project will turn profitable quickly even without the alluvial gold.

Things will definitely get a lot brighter when the yellow metal is found during this sand dredging process.

3. Building an industry-leading ESG foundation

Despite being a small company, Angkor has made the conscious choice to dovetail any mineral or resource extraction with an environmentally responsible, community-focused approach.

The firm has incorporated good ESG practices into their businesses from day one and actively working with communities towards a sustainable, lasting legacy.

One prime example is how Angkor advocates hiring locals for their projects, not just for overhead savings but to build strong relationships with communities and governments. Education has always been a core tenant of Angkor’s philosophy too – skillset training, financial literacy and even school construction and support are all in Angkor’s resume.

Without a doubt, this ESG focus bolstered Angkor as a good potential partner to gain the trust of the governments and communities and work in more, bigger projects in future.

Dedicated Management Team

From the above, you can see that Angkor’s management team possesses vast experiences in their respective fields.

  • CEO Delayne Weeks have over 30+ years of experience in corporate finance and development projects across 5 continents.
  • Mr. Mike Weeks, VP of Operations, has racked up 35 years experience in project management in the energy and mineral space.
  • Mr. Dennis Ouellette, VP of Exploration, is a geologist and has worked on exploration programs in Canada and internationally.

Last but not least, shareholders would take comfort in the alignment of interests of the management team – over 40% of Angkor’s shares are in close hands and the Management & Insiders own approximately 23.2% of the company.

Conclusion

Despite being a small company,  Angkor made a conscious choice to dovetail any mineral or resource extraction with an environmentally responsible, community-focused approach.

All in all, Angkor will continue to advance on the growth prospects from their two licenses and build a bigger portfolio through sales and joint venture agreements with successful international partners.

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