Gold: What initially looked like the early stages of an assault on last April’s highs ended in a freefall back below $1900.
After eight consecutive weeks of steady accumulation, this correction might represent a healthy pause before the next leg higher. And there might be enough gravitation pull to yank the metal back into the $1825 zone. Beyond that, who knows? $1750 might come into play. But predicting Gold’s short/medium term price action in these uncharted waters is a mug’s game; we could just as easily see the metal stage a rally back up to last week’s highs.
The James Bay lithium frenzy continues
Patriot Battery Metals (PMET.V) – PMT.ASX) – (PMETF.OTC) – (R9GA.FRA)
In my last report on Jan. 23—Patriot (PMET) knocks it out of the park triggering a trading frenzy…—I stated the following concerning recent assays served up via the company’s Corvette Project where the headline interval weighed in at an impressive 156.9 meters of 2.12% Li2O (including 25.0 meters of 5.04% Li2O):
Hole 93 (CV22-093), a 100-meter stepout along strike to the east, tagged spodumene pegmatite over a core length of 52.2 meters. Assays for this important stepout are pending.
Continued success in stepping out from the CV5 pegmatite cluster is fueling speculation that Corvette’s mineralization may extend 2.5 kilometers eastward to CV4, and 4.3 kilometers westward to CV13.
Newsflow out of the Corvette camp has been moving fast. Last week, the stock continued its steep trajectory after the company dropped highly anticipated values for Hole 93:
Hole 93, the easternmost hole drilled during the 2022 campaign—the 100-meter stepout highlighted above—assayed 3.34% Li₂O along its entire 52.2-meter length. A 15-meter sub-interval tagged 5.10% Li₂O. Solid hit. This zone of uber high-grade Li₂O has now been christened the ‘Nova Zone.’
Also included in this last batch from CV5—values that further define ‘Nova’—is drill Hole 100 which assayed 1.96% Li2O over 131.2 meters (from 250.8 m to 382.0 m). This broader interval includes a higher-grade sub-interval of 2.97% Li2O over 57.0 meters.
Damn fine gunnery via the biz end of the drill bit, this.
The news triggered an up gap on the chart, and except for a bout of weakness on Feb. 2nd, which was followed by an end-of-session (high volume) rebound, the stock went on to tag all-time highs by the end of the week.
PMET is currently testing the potential link between the CV5 and CV4 pegmatite clusters 2.5 kilometers to the northeast: “Extension of the CV5 Pegmatite eastwardly, and thus the high-grade Nova Zone, is currently being tested with the first series of drill holes as part of the 2023 winter drill program.”
This crew is doing a superb job of keeping investors in the loop regarding the potential to extend CV5’s compelling geology further eastward. While putting the final touches on this piece earlier today (Feb. 5th), the company forced me to reformat this content after it dropped the following midday headline… on a Sunday (this side of the pond):
Here, the company offered detail concerning the first four holes from their 2023 drill campaign (105, 106, 107, and 108), stating that near-continuous spodumene-bearing pegmatite, ranging from approximately 54 meters to 132 meters, was intersected in 100-meter stepouts along the newly christened Nova Zone (eastward stepouts from Hole 93 highlighted above).
An initial visual read via geological logging of the drill core appears to have extended CV5’s mineralization another 400 meters to the east—CV5’s total strike is now 2.6 kilometers. This is how you grow a tier-1 deposit.
One of the more compelling dynamics underpinning this play is the potential to connect the dots—to establish continuity—between CV5 and the CV4 pegmatite cluster some 2.5 kilometers distant. The company has narrowed that gap to roughly 2.0 kilometers with these hits.
Drill holes 105 and 106, ~100-meter eastwardly stepouts, collared immediately along strike of Hole 093 (Nova Zone), tagged near-continuous pegmatite of approximately 84 and 132 meters, respectively.
The two holes were collared at the same orientation as CV23-093 and indicate the pegmatite has widened at this location and depth along strike. The pegmatite continued to be intersected in drill holes CV23‑107 and 108, a further 100 meters and 200 meters along strike, respectively, with widths of approximately 65 meters and 54 meters (core length), respectively. The pegmatite remains to be tested further at depth along this 400 meters of new strike length. Core assays have not yet been received for any of the holes completed to date in 2023.
Note the boulder field (avg grade = 1.4% Li2O) highlighted on the above map. Located roughly one kilometer down ice, PMET’s geological sleuths suspect spodumene pegmatite may be present under cover along this corridor due to the angularity and size of the boulders—”they are not interpreted to have been sourced from the CV4 Pegmatite cluster and therefore, may indicate a source under the shallow glacial lake, along strike of the current drilling at CV5.”
If a boulder has angular (sharp) features, it likely hasn’t traveled far from its source.
Bound to fuel a new element of speculation, stepout drilling at the other end of CV5, westwardly along strike towards the CV13 pegmatite cluster (map below), is expected to commence shortly.
Core samples for the first three holes from this winter campaign are at the lab. Four rigs are currently turning on site—a fifth will be mobilized directly.
This next image gives you a sense of this recent drilling activity looking west towards CV5.
What was once a simple drill hole play now has many moving parts and a market cap well north of $1B (PMET appears destined to join the $2-Tee club).
Before last Friday’s session drew to a close, the following speculative enticement hit the wires and traveled rapidly across social media channels—Is Chris Ellison’s MinRes buying Patriot Battery Metals?
It’s important to note that neither Billionaire Chris Ellison nor PMET is commenting on this speculation.
Some believe PMET is now in play. I have no opinion on the Chris Ellison speculation, but there appears to be significant accumulation here (note the volume accompanying this recent share price trajectory on the chart further up the page).
Before moving along: Of the James Bay area plays, the ones currently on my radar are Q2 Metals (QTWO.V), Benz Mining (BZ.V), Ophir Gold (OPHR.V), Brunswick Exploration (BRW.V), and Azimut Exploration (AZM.V).
Moving along…
Apollo Silver (APGO.V) – (APGOF.OTC) – (6ZF0.FRA)
Last week Apollo dropped a final batch of Phase 2 assays from its flagship Calico Silver Project in San Bernardino County, California, where the current inferred ounce count stands at 166 million ozs of silver (58.1 million tonnes at an average grade of 89 g/t).
The Feb. 1 headline: Apollo Reports Final Silver Intercepts from the Calico 2022 Drill Program
Results from eight RC holes are presented in this press release. This brings the total number of Phase 2 (resource definition) holes to 39 of the 44 drilled—the remaining five were targeting oxide gold and will be reported separately once received.
Highlights from this final round of Phase 2 results include:
- Drill hole W22-RC-075 (map below): 197 g/t Ag over 61.0 meters from surface, including;
- 273 g/t Ag over 18.0 m from 35.5 m down hole, and including;
- 508 g/t Ag over 1.5 m from 41.5 m down hole;
- 273 g/t Ag over 18.0 m from 35.5 m down hole, and including;
- Drill hole W22-RC-077 (map below): 135 g/t Ag over 85.5 meters from 5.5 meters down hole, including;
- 417 g/t Ag over 4.5 m from 28.0 m down hole;
- 254 g/t Ag over 1.5 m from 46.0 m down hole;
- 298 g/t Ag over 3.0 m from 49.0 m down hole;
- Drill hole W22-RC-078: 96 g/t Ag over 32.5 meters from surface, and
- 84 g/t Ag over 31.5 m from 44.5 m depth down hole;
- Drill hole W22-RC-079: 129 g/t Ag over 40.0 meters from surface, including;
- 275 g/t Ag over 1.5 m from 5.5 m depth down hole, and including
- 322 g/t Ag over 1.5 m from 23.5 m depth down hole.
The company now has all of the silver values from this Phase 2 campaign counted—all the drill hole data it needs to complete an updated resource estimate, scheduled for release in the coming weeks.
Tom Peregoodoff, Apollo’s CEO: “Starting with the expedited permitting time of six weeks and through to the completion of the drilling in November 2022, the drill program has been successfully and safely completed with no significant cost or schedule over-runs and no lost-time injuries. Since we first received assays seven months ago, results have shown consistent, thick intersections of high-grade silver mineralization at Waterloo. These new results are no exception. Work on the updated MRE resource is advancing on schedule and with receipt of these silver assays we remain confident that the results of this work will be ready for release in early March.”
The company went on to state that the San Bernardino County Land Use Department has granted Apollo a 12-month extension to its drilling permit (valid until February 3, 2024). This extension was handed down only four weeks after it was requested (SB is a mining-friendly county).
This fast-approaching resource update may represent a significant catalyst for the stock, especially if the metal takes out resistance at $25-ish, as many analysts predict.
Teuton Resources (TUO.V) – (TEUTF.V) – (TFE.FRA)
On Jan. 25, Teuton released a corporate update concerning its flagship Treaty Creek Project (TC) in BCs golden Triangle where it holds a 20% carried interest—the company’s JV partner, Tudor Gold, is covering all exploration costs to earn a 60% interest in the project (American Creek owns the remaining 20%, also carried)—Update on the Goldstorm Mineral Resource Estimate and Project Development — Treaty Creek Property, Golden Triangle, British Columbia.
TC’s resource currently stands at 19.4 million ounces at 0.74 g/t AuEq (M&I) and 7.9 million ounces at 0.79 g/t AuEq (Inferred). This 27.3M AuEq ounce count only factors in drill hole data to the end of the 2020 drill season. This fast-approaching MRE will figure in two additional (aggressive) infill and step-out campaigns since then (TC’s mineralization remains open in all directions and at depth).
The MRE update, scheduled to drop before the end of the quarter, is expected to lean on TC’s higher grades to increase the overall quality of gold, silver, and copper resources.
Tudor Gold continues to move forward on an updated Mineral Resource Estimate (MRE) for its Goldstorm Deposit at Treaty Creek by completing an updated geologic model and advancing the understanding of the mineral distribution at Goldstorm.
According to this press release, ongoing road construction in the region, once completed, will give TC year-round, all-season vehicle access.
In addition, it is the Company’s understanding that Seabridge also plans to bring in a power line to their tailings site area bringing additional infrastructure much closer to our claim boundary.
Also, a new hire: Jeff Kyba, of the ‘Kyba Red Line’ fame, has come on as a director.
During his 5+ year tenure as Regional Geologist, he completed extensive site visits and field work investigating a variety of mineral deposits throughout the region. This work resulted in several government publications and a map identifying favorable areas to explore for minerals, commonly known as the ‘Kyba Red Line’: a stratigraphic unconformity located within 2 kilometers of nearly all major deposits in the Stikine Terrane. His map remains in use today.
It’s important to note that TC adjoins and is on trend with Seabridge Gold’s KSM property and Newcrest Mining’s Brucejack property. It’s especially important to note that mining colossus Newmont Mining is taking a run at Newcrest’s assets—Newcrest Announces Non-Binding Indicative Offer from Newmont (this development is hot off the press).
Forum Energy Metals (FMC.V) – (FDCFF.OTC)
Lastly, I’m expecting an update from Forum Energy Metals shortly concerning a drill campaign at its Wollaston Uranium Project in the northeastern Athabasca Basin where drilling resumed in the second week of January.
Forum management is also gearing up for an aggressive exploration campaign at its district-scale Nunavut Uranium Project (Thelon Basin) later this season.
To get caught up on both projects, my write-up from November 22 might offer some useful insights— Forum Energy Metals (FMC.V) mobilizes drill rig to Athabasca Basin – a Q&A with Forum’s Wheatley and Hunter + a word on i-80 Gold (IAU.TO).
While waiting for newsflow, check out this recent interview with CEO Mazur…
You will also find CEO Mazur and VP of Exploration, Dr. Rebecca Hunter, at PDAC 2023 at booth 2825 from March 5th to 8th.
END
—Greg Nolan
Full disclosure: Forum Energy Metals is a HIghballer client. The author owns stock in Forum and Patriot.
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