With trading volume already surpassing the 180 million mark in the first hour of the day’s session and a share price that has spiked from a 0.1300 close on March 13, 2013 to a high of 0.3500 today it is hard not to take notice of the activity surrounding Goff Corp. (OTCQB: GOFF). Of course taking notice of GOFF’s activity doesn’t necessarily mean being impressed by the movement considering the company has done little in the past to justify any level of support from investors.
The surge in activity appears to have its roots in GOFF’s press release from Friday in which they announced that their wholly-owned subsidiary, Golden Glory Resources S.A., had acquired 100% interest in mineral leases in the Aguadas, Department of Caldas, Colombia area – “a region well known for multiple gold discoveries within the past several years as Colombia has opened its doors to global mining interest.”
GOFF goes on to provide a rather glowing review of the leases known as the La Frontera Prospect with company president, Warwick Calasse, stating “We are very encouraged by the initial acquisition we have landed in Colombia’s productive Caldas and Antioquia gold regions. The property shares a similar profile to many other successful gold projects in the region and has all the earmarks of a small, local operation that could quickly turn into something much, much larger – such as the multi-million ounce projects emerging in the Marmato. We plan to move quickly to establish detailed exploration. We want show our investors the potential for gold and get to drilling immediately. The La Frontera Gold Project is a highly prospective gold and silver target.”
What should be recognized by investors is the fact that according to a March 8, 2013 filing from GOFF the company still has some significant obligations that need to be met before this deal is really completed. As stated earlier the Golden Glory Resources S.A. (Golden Glory Panama), a company incorporated under the laws of Panama, acquired an option to purchase a 100% interest in and to a certain Columbian mining concession known as La Frontera (The Frontier) Project. GOFF issued 5 million shares of their Series “A” Preferred Stock to Golden Glory Panama and agreed to assume all obligations of the company pursuant to the Assignment Agreement dated January 21, 2013 between Golden Glory Panama, as assignee, and Sertesaz Ltd., and C&ENER SA, the current Colombian owners which own 60% and 40% of the concession, respectively.
In that filing March 8, 2013 filing GOFF stated that “to date Golden Glory Panama has satisfied an aggregate of $70,000 in respect of payment obligations pursuant to the Underlying Assignment Agreement.” To exercise their option to purchase La Fronetra Project GOFF is required to satisfy additional payments and exploration expenditures which include:
- an aggregate of $120,000 payable in six equal quarterly installments beginning March 31, 2013;
- an aggregate of $40,000 payable in two equal installments by September 30, 2015 and December 31, 2015, respectively;
- an annual payment of approximately $12,500 (beginning August 20, 2013) in respect of state surface fees for the property;
- completion of a $1,500,000 work program by March 7, 2015 with the following requirements:
$250,000 in expenditures by March 7, 2014;
$500,000 in expenditures by March 7, 2015;
$750,000 in expenditures by March 7, 2016; and
General and administrative expenses included in the work program budget shall not exceed $200,000.
- a royalty equal to $2 per ounce of gold, payable per ounce from production, for every ounce of gold up to 5 million ounces that is designated as a “Proven” reserve pursuant to an independently prepared technical report in accordance with Canadian National Instrument 43-101,
Where GOFF intends to come up with the money to satisfy these requirements is anyone’s guess as the company’s last quarterly report showed that they had cash in the amount of $5,653, which happens to be the total assets that they held. Of course they had no revenues so there is little chance that the company will be funding this acquisition from that channel, leaving them few other options other than the sale of securities.
None of this means that GOFF will ever get to the stage of production on this project as they revealed in their most recent press release that they had “requisitioned a detailed technical report on the La Frontera Gold Property to be issued immediately. The report is expected to contain comprehensive information on the property, its geology, mineralization, geography and a summary of proposed development initiatives for potential gold and silver targets and possible gold production.”
The idea that GOFF is now sitting on property that carries with it massive potential is a stretch to say the least, especially considering the company has no history of delivering results.