In the wake of securing their landmark mining permit and signaling their intention to up-list to the Big Board, Gold Mountain (GMTN.V) dropped another weighty headline:
Gold Mountain Mines Its First Mineralized Material at the Elk Gold Project
I knew they were close to exposing ore-grade material at the flagship Elk Gold Project near Merritt BC—they’d been stripping waste rock for months while awaiting receipt of the final (M-199) Mine Permit—but I didn’t realize they were this close.
The Company has dug right down to the 1100 vein system—some of the highest grade rock in these subsurface layers.
The targeted vein systems strike east -west and are currently being mined at the footwall of historical Pit 2. This zone of the property was mined in 2012 by previous operators and yielded a grade of 16.60 g/t, surpassing the contained ounces in the resource model by roughly 29%.
Highlights from this November 9th press release:
- The Company has exposed its 1100 vein system located on the footwall of historic pit 2;
- This area was mined by previous operators in 2012 at an average grade of 16.60 g/t;
- The Company will crush, weigh and assay the material prior to sending it to its Ore Purchase partners New Gold Inc;
- Year 1 of Gold Mountain’s mine plan contemplates mining some of the resource’s highest-grade material, resulting in an expected annual after-tax profit of $10,000,000.
The current (3-year) permit allows the Company to extract some 70,000 tonnes of ore per annum.
To make the most of this 70k tonne permitted capacity, the Company will be targeting this high-grade mineralization during its first year of operation to maximize near-term revenue and minimize the payback period. The Company believes they’ll achieve 100% payback in a mere six months (incredible).
Most companies in this wild west arena have a nasty habit of overpromising and underdelivering. This crew likes to set the bar high, and it delivers on these lofty designs, time and again, as a matter of mere routine.
The following vid isn’t just for promotional purposes—it summarizes the current mine plan superbly.
There’s real precision at work here (nice vid folks).
CEO Kevin Smith:
“First mineralization along our 1100 vein in Siwash North marks the Company’s transition from development into commercial production. Since purchasing the Elk Gold mine there have been questions surrounding Management’s ability to increase resources and get the project back into production. Fast forward to today, we’re targeting our third resource update, have successfully navigated the Provincial permit amendment process, completed all of our construction and are now stockpiling paydirt from our shallow mineralization. By completing our waste rock stripping and site preparation in parallel to our work with Indigenous Communities and Provincial Regulators on our permitting, we have been able to maintain our timelines of delivering material to New Afton and recognizing revenue in Q4 2021. The Mining Permit, TSX uplist and hitting mineralized material all in the first nine days of November highlights management’s focus towards execution and maintaining our committed timelines. Keep an eye out for more developments, as we intend to continue delivering value to our loyal shareholders and a very strong finish to the year.”
The Next Steps
Having stripped the waste rock down to the high-grade stratum, the Company is now in a firm position to achieve revenue in Q4 ‘21, just like it said it would. The focus will now shift to the following (operating) objectives:
- Continue to engage directly with surrounding Indigenous Communities to adhere to each Nation’s independent review process;
- Ramp up mining operations, targeting the Elk’s high-grade 1100 and 1300 vein systems;
- Deliver material to New Gold’s New Afton mine in Kamloops, located 133 km from the Elk Gold Project;
- Begin revenue generation and receive payment from its first mineralized material delivery.
The Company will mine, crush and sample the mineralized material before hauling it off to New Gold’s New Afton Mill just down the highway, in Kamloops, BC.
The haul trucks will be weighed on-site, and a third-party lab will assay each batch sample to determine the grade and value of each load.
New Gold will cut Gold Mountain a monthly cheque based on the weight and grade of each load of ore delivered to its mill (this Ore Purchase Agreement struck with New Gold was spelled out in a January 26th, 2021 press release).
Skyharbour Resources (SYH.V)
On November 10th, I summarized and updated Skyharbour’s joint venture (JV) projects in a piece titled Skyharbour Resources (SYH.V) – a JV project review plus a new deal inked at Yurchison, Athabasca Basin.
Shortly after I posted the above piece, Skyharbour dropped the following headline concerning its flagship 35,705-hectare Moore Uranium Project in the prolific Athabasca Basin (for those new to the U3O8 sector, The Basin is to Uranium what the Carlin Trend is to Gold).
These assays represent the second batch of drill results from a 19 hole, 6,598 meter 2021 summer/fall diamond drill campaign. The first batch of five holes—released back in mid-September—included a high-grade hit of 2.54% U3O8 over 6.0 meters (including 6.80% U3O8 over 2.0 meters).
Highlights from this November 10th press release:
- Hole ML21-13 was drilled within the east central portion of the Maverick East Zone. This hole intersected predominantly basement-hosted mineralization and returned 0.994% U3O8 over 5.7 metres from 270 metres to 275.7 metres including an interval of 1.51% U3O8 over 2.5 metres from 273.2 metres to 275.7 metres. The uranium mineralization was accompanied by intense clay alteration of the graphitic pelitic assemblages;
- The mineralized intercept in hole ML21-12 returned 0.33% U3O8 over a 6.0 metre interval from 282.5 metres to 288.5 metres downhole. This mineralization is entirely basement hosted within clay altered to replaced graphitic pelitic gneiss and local clay-altered to –replaced felsic intrusives. The hole is also enriched in Ni (≤0.74%), Co (≤0.21%) and Zn (≤1.2%);
- Substantial portions of the 4.7 kilometre long Maverick corridor remain to be systematically drill tested leaving robust discovery potential along strike as well as at depth in the basement rocks;
- At the Grid 19 target area, exploratory drillholes ML21-07 to -09 were the first holes drilled where two prospective EM conductors were identified by this winter’s SML-EM geophysical program. All three holes intersected highly encouraging altered, graphitic and sulphide bearing basement lithologies accompanied by anomalous levels of Boron (≤1290 ppm), Thorium (≤445 ppm), Nickel (≤500 ppm), V (≤350 ppm), and U (≤421 ppm). A notable intercept of 0.05% U3O8 over 1.0 metre occurs well into the basement in hole ML21-07 on the Slice Pond Conductor. Composite geochemical sampling in the second hole on this conductor, hole ML21-09, returned samples enriched in U (≤7.5 ppm partial digest) and B (≤161 ppm) over a broad 70 metre interval in the sandstone;
- Final assay results are pending for six more drill holes.
This 0.994% U3O8 over 5.7 meter hit further demonstrates the high-grade nature of the East Maverick Zone… mineralization that is entirely basement-hosted.
“Holes ML21-16 through -19 were drilled in the eastern end of the Maverick East Zone and at the eastern end of the Maverick Main Zone in order to establish linkages and extensions of the mineralization in the intervening interval between these two mineralized zones. The drilling successfully established the relationships and complexity of the geology and structure within this area, with geochemical results also pending for these holes.”
Regional targets
It’s important to note that the Grid 19 Target is only one of several high-priority regional targets along this massive 35,705-hectare expanse of highly prospective terra firma.
As summarized above, the first three drill holes at Grid 19 tagged anomalous/enriched zones of uranium mineralization.
Though they didn’t encounter high-grade rock in these first three, the drill bit tagged all the right indicator minerals—elevated levels of Boron, Thoriuym, and Nickel—and the kind of alteration and structure these geological sleuths need to see.
“The geochemistry and geology from the Grid 19 targets illustrated the prospectivity of this area which warrants further drilling.”
Jordan Trimble, CEO:
“We are very pleased with the results thus far from this most recent drill program at our flagship Moore Uranium Project as we continue to outline new high grade zones of uranium mineralization at the Maverick Corridor and make notable progress at earlier-stage regional targets. Final assays are pending for six holes from the program and we plan to commence a fully funded winter drill program early in the new year to follow up on these results. Skyharbour is very well positioned to benefit from the accelerating uranium market recovery with strong discovery potential and upcoming news flow from its continued drilling at Moore as well as at partner funded projects. Worth highlighting is that we now have five partner companies with Azincourt Energy, Valor Resources, Basin Uranium Corp. and Medaro Mining each planning upcoming exploration and drill programs at the East Preston, Hook Lake, Mann Lake and Yurchison projects, respectively.”
Summarizing the 2021 drill campaign:
Drilling on the Moore Uranium Project over the summer and fall of 2021 totalled 6,598 metres in 19 diamond drill holes. Thirteen holes (ML21-01 to -05 and ML21-12 to -19) were drilled on the Maverick East Zone, three holes on the Esker Target (ML21-06, -10, -11) and three on the Grid 19 target conductors (ML21-07 to -09). Results from holes ML21-01 to ML21-05 were reported in a previous news release dated September 14th, 2021. Results for holes ML21-06 to -13 have been received and samples for holes ML21-14 to -19 have been delivered to the SRC Geoanalytical Laboratories in Saskatoon for analysis. The results of these latter holes will be reported upon once all of them have been received, compiled and interpreted by Skyharbour’s geological team.
As noted in my November 10th piece, it’s shaping up to be a busy winter in The Basin. Come January/February of 2022, we’ll see drill rigs mobilized to several projects—another campaign at the flagship (drill plan details pending), a 7,000-meter program at East Preston with partner Azincourt, and an aggressive first-pass campaign at Hook Lake (up to 4,500 meters) with partner Valor. We may also see a rig mobilized to Preston, Mann Lake, or Yurchison (pure speculation on my part).
With China’s intent to build 150 nuclear reactors over the next 15 years, the fundamentals underpinning the uranium market are compelling. As CEO Trimble stated in a recent interview with Resource Stock Digest, China’s timelines can be relied upon—if they say 150 new reactors are on deck, we’ll see those 150 come into play.
When you tally up the digits Skyharbour has generated with its partner companies, you get $19.8M in exploration commitments and just over $10M in cash payments to the Company (all in strictly structured stages).
Assays from six additional holes are pending from the high-grade East Maverick Zone.
We stand to watch.
END
—Greg Nolan
Full disclosure: Both Gold Mountain and Skyharbour Resources are Equity Guru marketing clients (the authors own Skyharbour shares).
Additional fodder for your Skyharbour due dilly…
Skyharbour Resources (SYH.V) – Five Easy Questions with Maddy
Skyharbour Resources (SYH.V) to power the electrification of everything
