Argentina Lithium Raises C$4,99M In First Two Tranches Of Non-Brokered Private Placement, Expects To Raise C$6.75M In Total

Salar de Rincon; Salta province, Argentina

Argentina Lithium & Energy Corp. (TSX-V: LIT, FSE: OAY1, OTC: PNXLF) seems to be capitalizing nicely on the unstoppable all time high lithium prices, as it is raising significant amounts of cash at the moment, currently standing at C$4.99M and not done yet. The proceeds will be used for new exploration programs on their various LatAm lithium projects. The company already owns several early stage lithium projects in Argentina, and recently signed an option agreement to acquire two more projects in the same country, the Rincon West and Pocitos properties in the Salta Province.

(more…)

Gold Terra Enters Into Option Agreement With Newmont To Purchase Con Mine; Newmont Also Signs C$1.5M Strategic Investment

Following several weeks of lots of volatility in the gold price, caused by increasing inflation, a reshuffle at the Federal Reserve and most recently a brand new COVID-19 variant, Gold Terra Resource (TSXV:YGT)(OTCQX:YGTFF) (FRA:TXO) did a very important acquisition, by signing an option agreement with  Newmont, to buy the Con Mine. This property contains a significant part of the prospective Campbell Shear, source of millions of ounces of gold production (6.1 Moz) in the past, but also historic reserves and resources left behind when the mine was closed down in 2003, while gold was US$370/oz and mining became no longer economically viable. On top of this, Newmont showed confidence in the company as it signed a C$1.5M strategic investment for 3.7% of the outstanding shares. It will be interesting to hear from Executive Chairman Gerald Panneton about backgrounds, exploration potential and further plans.

(more…)

Koch Strategic Platforms Will Make US$100M Direct Investment In Standard Lithium

SiFT plant at Lanxess Project site

It has been a very busy week for Standard Lithium (TSXV: SLI) (NYSE:SLI) (FRA: S5L), as it first had to defend itself against a short report without merit which saw the share price temporarily crashing, and a few days later announced a US$100M investment by Koch Strategic Platforms, in order to advance its lithium projects further. Clearly Koch wasn’t very impressed by the short report, as they are knowledgeable in the field of energy transition, investing comparable sums starting this year in grid storage start-ups Eos and Lithion Power Group, and EV charging company EVBox. On a sidenote, in itself the move into energy transition away from fossil fuels is somewhat remarkable to see at Koch, as parent company Koch Industries made its fortune and is still heavily invested in fossil fuels, but they probably don’t want to miss out on the ongoing paradigm shift, and follow the oil super majors like Shell, who also started their own dual track transformation, albeit gradually.

(more…)

Kenorland Minerals Closes C$5.2M Strategic Investment By JV Partner Sumitomo; Drill Results Regnault Coming Up Soon

It seems Kenorland Minerals (KLD.V)(3WQO.FSE) is doing very well at the summer drill program currently underway at their flagship Regnault project, as JV partner Sumitomo Metal Mining Canada was happy to do a strategic investment of no less than C$5.2M in Kenorland equity. This is not something you see very often, and I will discuss with CEO Zach Flood the potential meaning behind this move. After a generally successful winter program, with most holes hitting mineralization at Regnault, Kenorland is looking to follow up on the already found R1 and R2 structures at Regnault with the aforementioned 18,000m summer drill program, which commenced in July of this year. The company is also busy with other exploration programs at many more projects, either fully owned, optioned or JV-ed, making this one of the busiest exploration juniors I know.

(more…)

Standard Lithium Announces Positive PEA At South-West Arkansas Lithium Project With Lithium Product Pricing At All-Time Highs; After-Tax NPV8 Of US$1.97B @ US$14,500/t LiOH

SiFT plant at Lanxess Project site

Introduction

At a time where lithium product pricing has fully recovered, beating all-time highs again, Standard Lithium (TSXV: SLI) (NYSE: SLI) (FRA: S5L) is working diligently on their flagship Lanxess project, and its second South-West Arkansas (SWA) lithium project, both in Arkansas, US. Testing and optimization work is ongoing at the Lanxess project, and recently the company announced the strong results of a Preliminary Economic Assessment (PEA) for its SWA project. As part of this PEA, the brine resource area was updated to consider a potential unitized area of production, leading to a 49% increased total (global) in-situ resource of 1,195,000 tonnes Lithium Carbonate Equivalent (LCE) at the Inferred category enabling the company to define a 20-year life of mine, with a meaningful annual production of 30,000t of battery quality lithium hydroxide. The SWA PEA, the resource and the current state of affairs of the Lanxess project will be discussed in the following article.

(more…)

Argentina Lithium Enters Option Agreement To Acquire More Lithium Exploration Assets; Lithium Product Prices Closing In At All Time Highs

 

Salar de Incahuasi; Catamarca province, Argentina

There seems to be no end in sight for current battery metals sentiment, and lithium product prices are the largest beneficiaries in this regard, which is obviously of interest for Argentina Lithium & Energy Corp. (TSX-V: LIT, FSE: OAY1, OTC: PNXLF). The company already owns several early stage lithium projects in Argentina, and recently signed an option agreement to acquire two more projects, which will be discussed later in this article.

All pictures are company material, unless stated otherwise.

All currencies are in US Dollars, unless stated otherwise. 

Most recently, even Ford announced an investment of US$7B as part of a US$30B program in order to convert their operations into an electric vehicle producer, a car brand that I don’t really associate with progressive thinking. As a consequence, there appears to be a shortage of lithium products, which can be witnessed by current pricing charts. It is not that easy to find decent and especially recent charts anymore, as my usual trusted source for prices Matt Bohlsen at Seekingalpha has vanished behind a paywall now with his free articles unfortunately. By means of replacement, I found several other sources, as there is Tradingeconomics:

Unfortunately these prices are in Chinese Yuan/Renminbi, so as 1 yuan is US$0.155, 1 ton LCE is worth US$25,757. Please note these are domestic prices. Another source (Fastmarkets) represents lithium carbonate at US$20.50/t:

These prices are in fact all time highs, according to Platts. Fastmarkets also publishes useful charts, representing the difference between international markets in USD, and Chinese domestic markets in yuan:

It is interesting to see the domestic pricing experiencing a bigger spike. According to Argentina Lithium CEO Niko Cacos, this is most likely caused by higher interest for everything EV related in China. If the current shortages of lithium products are short-lived and caused by COVID is hard to say, consensus among analysts seems to be LCE pricing exceeding US$15,000-16,000 for years to come. This is of course an excellent development for Argentina Lithium, which is in the process of revitalizing the company. After raising a modest C$0.76M in April of this year, the company set out to acquire more exploration assets.

By entering an option agreement to acquire a 100% interest in the Rincon West and Pocitos properties in the centre of the lithium district of the Salta Province (a mining friendly jurisdiction in Argentina), the company meaningfully expanded their lithium project portfolio. The terms for the two properties, with a combined footprint of 18,227 hectares, aren’t cheap, as the company already issued 750,000 shares to the local vendor on signing plus C$500,000 worth of shares over a 12-month period; and cash payments totaling US$4,200,000 over 36 months, but limited to only US$1,050,000 in the first 18 months, US$800,000 of which are firm commitments over the first year. At a share price of C$0.29, this meant the 750k shares are worth C$217,500, and the total compensation would be C$6.05M. This is quite something for a company with a C$12.65M market cap, which just weeks earlier traded at about half of this:

Share price; 1 year time frame (Source: tmxmoney.com)

The share price of Argentina Lithium already appreciated on lithium sentiment, but still doesn’t have a resource or drilled economic intercepts. Imagine what will happen if they do on one of their new properties. There isn’t much information to go on per the news release, but in my view the Rincon West property seems the most interesting one, as it is located on the west side of the Rincon Salar, owned by Rincon Mining (private) and Argosy Minerals (ASX-listed), which operate individually and very differently from each other.

Rincon Mining has been testing a pilot plant since 2017, testing a technology that would avoid using evaporation ponds. They tried to raise US$650M in vain for 2 years since 2018, and as a consequence changed the technology in 2020, and downsized the plant from 25kt LCE to 10kt LCE. They are fully owned by well-known mining financier Sentient Equity Partners, and are looking to raise US$100M now.

Argosy is already advancing a first 2,000 tpa LCE modular unit through construction, seeking production mid 2022. If successful, this will be expanded rapidly into a capacity of 10,000tpa LCE. Here is an areal view of their project:

They have a modest JORC resource of 245kt Li2CO3, at an average grade of 321mg/L, which needs a lithium product price of over US$10,000/t Li2CO3 in order to be economic. This seems a formality now fortunately, although it wasn’t just 6 months ago. As can be seen on this map, taken from the presentation of Argosy, there is plenty of room for Argentina Lithium to acquire interesting claims of the Rincon Salar, as the coveted brines containing lithium are located at depth (below 100m at this particular salar):

According to Argentina Lithium CEO Cacos, a site map with claims and more information can be expected in the presentation around a week from now. I delved into my own database of information, and came up with this table, lining up a number of well-known salar-type brine deposits in the Americas, with most of them in the Lithium triangle:

To my delight the Salar the Rincon was also present. As can be deducted, the average lithium grade isn’t very high, but at current prices this shouldn’t be a problem, as Argosy is proving already. With lithium brine deposits, one always has to be careful with contaminants, for example calcium or magnesium, as they cause increased processing costs. For this salar the magnesium/calcium/sulfate content is somewhat above average but certainly not problematic.

There isn’t much information available on the second property, the Pocitos prospect, as it is located on the western side of the Pocitos salar, but has seen modest lithium exploration in the past, including geophysics and surface sampling, with very limited drilling.

Salar de Pocitos

The company also optioned additional properties at the Salar the Antofalla on August 4, 2021, where they already owned a significant 9,000 hectare land package. Argentina Lithium is earning into a 100% interest in a 5,380.5 hectare property set adjacent to the existing claims. Albemarle owns the largest part of this salar, which has a historic estimate of 11.8Mt LCE @ 350mg/l Li. Terms of the option agreement include cash payments totaling US$4,000,000 over 42 months, but limited to only C$600,000 in the first 18 months. The option also includes annual exploration expenditure commitments of C$500,000 in year one, followed by C$1.5M in year two, C$2.0M in year 3 and C$3.0M in year 4, totaling payments at C$12.1M. These amounts mean that the company has to explore aggressively, and find something worthwhile, in order to get the share price to significantly higher levels, so sufficient money could be raised by then to handle the payments, besides financing ongoing exploration programs and G&A.

The latest option agreements mean significant payment obligations for the company within one year, and as the current cash position is at C$500K now, I was wondering when management was looking to raise money in the markets, and how much. If resuming exploration activities this year is still the goal as stated in my last article, doing a placement soon is certainly necessary. According to CEO Cacos:  "As we are finalizing our exploration plans, which we will announce shortly, it is certain that we are going to have to raise additional funds to finance these programs."

Furthermore I asked Cacos what his plans/strategy are for the first 6-12 months, regarding exploration programs, exploration drill permits, or even acquisition of more projects. He answered: “As mentioned above, our exploration plans will be announced soon. Argentina holds tremendous opportunities for making new lithium discoveries, especially within the Lithium Triangle. It remains one of the most underexplored countries in the world. Therefore, even with the onset of our exploration programs, we continue to prospect and look for new opportunities, as there is great promise to make multiple world-class lithium discoveries in this country.” It will be interesting to see what the company is up to in the short term for sure.

4. Conclusion

After signing two option agreements for a 100% ownership in 3 different lithium brine projects in Argentina, management appears to have sufficient projects to work on for the foreseeable future. Raising cash for upcoming exploration programs is the top priority now, and hopefully the company can start drilling as soon as possible, as the markets are enjoying an extremely strong lithium sentiment the last six months. I am looking forward to the exploration programs and other developments of this tiny lithium player, which is finally gearing up for action.

I hope you will find this article interesting and useful, and will have further interest in my upcoming articles on mining. To never miss a thing, please subscribe to my free newsletter on www.criticalinvestor.eu in order to get an email notice of my new articles soon after they are published.

Disclaimer:

The author is not a registered investment advisor, and has a long position in this stock. Argentina Lithium and Energy is a sponsoring company. All facts are to be checked by the reader. For more information go to www.argentinalithium.com and read the company’s profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.

Salar de Rincon

Gold Terra Hits 4.57m @ 11.2g/t Gold At Yellorex Gold Zone Along Campbell Shear Structure

With the highly anticipated Phase 2 drilling program underway since July 16th, testing the Campbell Shear at the Yellorex zone immediately south of the Con Mine (Yellowknife City Gold project, Northwest Territories, Canada) and optioned from Newmont, Gold Terra Resource (TSXV:YGT)(OTCQX:YGTFF)(FRA:TXO) was finally able to announce the first drill results. The assays of hole GTCM21-014 came back from the lab, and it was a solid result, with 4.57m @ 11.22g/t Au from 357m.  As a quick reminder, the Campbell Shear produced approximately 5 of the 6 million ounces of gold produced at the former Con Mine (1938-2002), is the main reason Executive Chairman Gerald Panneton (of Detour Gold fame) joined the company, and is the priority target for management.

All presented tables are my own material, unless stated otherwise.

All pictures are company material, unless stated otherwise.

All currencies are in US Dollars, unless stated otherwise.

To date, the company has completed 8 holes totaling 2,770m from their Phase 2 drill program, and is testing another part of the Campbell Shear Structure, over a strike length of 1km, and also a depth of 1km. Gold Terra already encountered high grade gold during Phase 1 drilling (for example hole GTCM21-005 with 4.65m @ 14.1g/t Au). This Phase 2 drilling takes place at the claims under option from Newmont, and these are arguably the most interesting claims Gold Terra has, as the northern tip of these claims contains the part of the Campbell Shear that is adjacent to and on strike with the Con Mine, that produced 5Moz Au in the past. On a sidenote, Newmont owns the historic Con Mine itself.

Below is a map in more detail:

As can be seen on the map above, Gold Terra is looking to drill more to the north, towards the historic main orebody of the Con Mine (represented by the “5Moz Mined” tag). Future Phase 2 drilling will not only test the further extension of this zone, but will test additional shoots indicated by historical exploration, broadening the prospective target area for Yellorex. As can be seen in the section below, hole GTCM21-014 confirms the plunge continuity of the high-grade shoot intersected in hole GTCM21-005:

The current program is concentrating on the Yellorex Zone and South Con Mine area with a 50 to 100 metre drill spacing along strike and down dip. Compilation work has shown that the strong sericite alteration and quartz veined gold system is dipping to the west and steeply plunging to the south with an interpreted plunge length of more than 1.5 kilometres. The drill program will follow this plunge to test the continuity of the high-grade gold lenses at depth and along strike.

After talking to CEO David Suda, the plunging system is projected to reach estimated depths of below 750m to potentially 1,000m. The plan is to go deeper in 100m increments, following successful Yellorex mineralized intercepts. This is a welcome development, because as you probably know, in my view any multi-million ounce gamechanger potential at the Campbell Shear (this is the reason why Executive Chairman Panneton from Detour fame joined the company) should be searched for at depths below 500m, analogous to the nearby Con Mine, where the main orebody (5Moz Au) was found between -650m and -1800m, as can be seen in this long section across the Campbell Shear from north to south:

Besides simply aiming deeper with the drill bit, it is also a question of finding the mineralization styles that host high-grade gold. High-grade gold seems to occur within wider alteration zones with pervasive anomalous gold values, and these characteristics act as vectors to high-grade gold which will assist future drill programs on the Campbell Shear. Smoky quartz and sericite alterations are seen as favorite characteristics, and this was again confirmed at recent hole GTCM21-14.

Keep in mind this beautifully mimics the historically identified geological controls in the Con Mine, which consists of strongly sericitized and sheared mafic volcanic rock associated with arsenopyrite, pyrite and stibnite mineralization with the highest-grade gold in smoky quartz veins. CEO David Suda was quick to confirm this conformation in the latest news release:

"The Yellorex zone shows strong potential to add to our current resource of 1.2 million ounces of gold and underscores the significance of the Newmont Option Agreement to the future of the project. We are very pleased with the assay results from the first Phase 2 drill hole which confirm excellent continuity of the zone 80 metres below hole GTCM21-05 and reaffirms the validity of our geological interpretation. "

I’m curious for further stepouts along strike, but first we have to await the assays of the other 7 completed holes. According to Suda, we can expect the results to be announced around mid- October. As the Phase 2 drill program will see 10,000m of drilling and just 2,770m is completed, there is still 7,230m to go. The plan is to step out at 50 or 100m spacings, with the last holes hitting targets at or below 500m depth, as the geologists are following the mineralization down plunge, of which the trajectory and depths aren’t clear yet. In the following section the 3 red arrows make it clear that current mineralization is considered open at depth:

Management estimates the timeline for drilling the deepest holes to happen around late fall/ early winter, with the results hopefully coming back from the lab at early winter. During the summer, the last results of the 7,242m Phase I drill program were announced, and when looking at the same section again, it is clear why the current drilling is focusing on expanding Yellorex:

When estimating a mineralized envelope of Yellorex, I arrived at a hypothetical tonnage of length * width * thickness * density of 500m * 300m * 5m * 2.75t/m3 = 2Mt. The majority of mineralization (about 75%) is indicated by 5-20 gram*meters, about 25% by 20-50 gram*meters. On average I’m assuming an average grade at 5m thickness of 4 g/t Au, already resulting in a hypothetical 250koz Au, which would be a nice start for sure, hypothetically increasing the total resources to 1.45Moz Au for Gold Terra.

Keep in mind, the future resource potential with its exploration risks isn’t all there is for Gold Terra, the current resource of 1.2Moz Au is a pretty solid base for the company, as I estimated the economic potential at an after-tax NPV8 of US$235M in an earlier article, which would be 8 times the current market capitalization. A market cap which is becoming cheaper and cheaper, also due to tax loss selling, considering what Gold Terra owns. The treasury contains C$3.9M, and the company has future plans to raise cash in the markets soon for additional drilling in 2022.

Conclusion

The first 8 holes of the Phase 2 drill program at Yellorex have been completed, and the first assay was received from the lab. An intercept of 4.57m @ 11.2g/t Au is solid, and surely will add ounces to the Yellorex envelope, already estimated by me at a hypothetical 250koz Au. It is my strong conviction that potentially game changing mineralization is located at depth, and fortunately Gold Terra has designed the Phase 2 program to target this as well. The deeper holes are expected to be completed late fall/early winter with assays coming back in early winter, and by that time it might be quite interesting to be a shareholder.

I hope you will find this article interesting and useful, and will have further interest in my upcoming articles on mining. To never miss a thing, please subscribe to my free newsletter on my website www.criticalinvestor.eu, in order to get an email notice of my new articles soon after they are published.

Disclaimer:

The author is not a registered investment advisor, and currently has a long position in this stock. Gold Terra Resource is a sponsoring company. All facts are to be checked by the reader. For more information go to www.goldterracorp.com and read the company’s profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.

Alianza Minerals Intercepts More Silver At Haldane

Mount Haldane, Yukon

Alianza Minerals (ANZ.V, TARSF.US) recently completed the 2021 drilling campaign at their flagship Haldane silver project in the historic Keno Hill Mining District. After the impressive 1.78m @ 818g/t silver and 1.26m @3,267g/t silver intercepts, the company finally seems to be on track for economic silver mineralization, and created some expectations along the road as well. The drillers managed to hit more silver at each hole they drilled since, although the results weren’t as stellar yet, but still decent.

All pictures are company material, unless stated otherwise.

All currencies are in US Dollars, unless stated otherwise.

On September 23, the last two holes were reported from the 2021 drill program at Haldane, focusing on the West Fault target, HLD21-26 and HLD21-27. These holes were 50m stepouts along the Ewing North Fault, and can be seen here:

The results for both holes were solid but nothing special: HLD21-26 returned 3.05m @ 205g/t Ag (1,363g/t AgEq due to high zinc/lead values) from 270m, and HLD21-27 showed 4.8m @ 81.4g/t Ag (113g/t AgEq) from 225m. Both results were true width.

The aforementioned two best holes are HLD20-19 and HLD21-24, and it will be clear from looking at the table that quite a lot of intercepts also contain substantial amounts of zinc and lead, resulting in a sometimes much higher AgEq grade. It is far from uncommon to see these two metals show up at zinc mineralization, and can often contribute meaningful amounts of byproduct, lowering the opex of a mine.

CEO Jason Weber strongly believes the best is still to come:

“After the exceptional result from drilling late in 2020 in HLD20-19, our approach was to determine the orientation of high grade shoots of vein mineralization through a grid pattern of 50 metre step outs on strike and down dip. This approach was successful in extending mineralization to depth and identifying the likely orientation of high-grade silver mineralization. This drilling also indicates that the West Fault is a complex of structures and veining tends to be strongest in an upper structure (WF2) in the northeast and transitions to a lower structure (WF1) to the southwest.”

These two structures can be seen here:

Weber continued: “Although strong veining within the West Fault structure was seen in both HLD21-26 and HLD21-27, the overall width was slightly wider and the galena (and closely associated silver) content was lower in general which leads us to believe that the strongest, thickest and potentially highest grade mineralization may lie along strike to the southwest and down plunge. We look forward to our next phase of work which will target this extension.”

It wasn’t exactly clear to me why Weber and his team think the best mineralization might be located to the southwest along strike, and most likely not to the northeast (although they don’t rule it out either) which had a hole returning more or less the same results. This is what he had to say about it: “We prefer the downdip and the southwest directions as the intersections in holes 24 and 25 show the system is open to depth. We will, at some point, drill the northeast direction and could see the vein strengthen in that direction. But for now the results point to higher priority drilling to the southwest.”

Management currently views the area where the width and grade of the vein is the strongest, as a complex of faults and splays rather than a single discreet fault structure. The latest concept is believed to be a “step over” from the WF1 vein to the WF2, occurring in the vicinity of the HLD21-24 and -25. The orientation of the step over might plunge steeply to the southwest in the plane of the West Fault Complex and high-grade shoot geometries could also be aligned in this direction. CEO Weber expects to drill further stepouts around Q2, 2022, but targeting of those holes is just starting now with an in depth evaluation of the results, and relating them to geological observations in drilling. Once that is further along they will have a better idea of the size and scope of the next program.

The West Fault Complex is traced for over 650m and can be interpreted to extend to 1.1 km in length before merging with the 2.2 km-long Main Zone structure.  Drill testing to date covers only a fraction of the West Fault Complex target. As a reminder, here is an overview:

Silver mineralization has now been intersected in nine holes that pierce the WF1 and WF2 veins over 90 metres of dip direction and 100 metres of strike direction. The West Fault Complex is one of the four high-priority silver-lead-zinc-bearing vein drill targets at Haldane, shown in the map above.

As can be seen in this schematic long section, hole HLD21-24 and HLD21-25, of which the last was reported on August 18, 2021,  are somewhat deeper compared to the latest HLD21-26 and HLD21-27:

The reported holes from August 18 (HLD21-23 and HLD21-25), combined with best hole to date HLD21-24 (reported on July 12 and discussed in an earlier article) were a nice set of assays, showing economic results down dip and along strike, represented by this table:

The high grade remains confined to narrow veins. As the minimum width for large scale mining is usually 2m, these veins are still very economic, as the gross metal value for 300g/t Ag is US$110/t if a vein would be 1m wide, as another 1m of waste would have to be mined as well. Underground mining costs are usually in the range of US$45-60/t, so there is a healthy margin.  It is interesting to see that if silver grades aren’t spectacular, often the zinc grade is substantial. As the deeper intercepts seem to have the highest silver-equivalent grades, I wondered why management didn’t drill deeper targets as well with their last holes, hitting the structure below for example HLD21-24. I also wondered if the geology of nearby drilling Alexco Resource (AXU.TO) couldn’t provide useful conceptual information about potential trajectories of silver veins at Haldane, as the geological makeup is the same for the entire Keno Hill District.

As a reminder, Alexco Resource (AXU.TO) has drilled results like 8.76m @ 3,583 g/t Ag, 5.3m @2,070 g.t Ag, 8.15m @ 1,414 g/t, 6.12m @1,560 g/t and 7.46m @1,381 g/t Ag at their project nearby, and is looking to increase the existing resource of 45Moz @ 844 g/t Ag. They own several other high grade deposits in Keno Hill as well, only confirming the very prolific nature of the Keno Hill region.

CEO Weber answered: “Our program was planned to test the most likely vein plunges as indicated by the orientations at the other Keno District mines, including those that Alexco is actively mining. In the 2020 plan we wanted test the extensions up and down dip of hole 19. We tested down dip with Holes 24 and 25, which showed the extensions to depth, be we wanted to stick to the original plan to test up dip with hole 27.”

Despite the good results, the share price appears to be sideranging since March of this year and even breaking down further:

Share price 1 year timeframe (Source tmxmoney.com)

In my view, there are a number of reasons for this. The summer doldrums and the weakening silver price have undoubtedly had its fair share of impact on investor sentiment as well, and tax loss selling seems to have started even earlier this year. Notwithstanding this, the good drill results at Haldane didn’t receive much enthusiasm, as if only stellar intercepts indicating pretty economic and sizeable deposits could move the needle nowadays. To me this is not justified, as exploration is a difficult business, and such deposits aren’t found at the first drill hole anymore, but it appears to be the new normal in this period of negative sentiment. Until this sentiment changes, there is not much Alianza can do it seems, but keeping up the good work at Haldane, hoping sentiment turns positive again and potentially producing good results on their other targets and projects.

Management would definitely like to continue to grow the West Fault target, but would also like to go back to Middlecoff and their new Bighorn target, to follow up on the new vein targets discovered in 2019 drilling. According to Weber, plans for these targets will be incorporated into the 2022 planning. Holes at these targets will be prioritized in the sequencing for next year’s drilling.

Besides Haldane, the company is working at Twin Canyon in Colorado, and Tim Silver in the Yukon. They are working on a drill permit for Twin Canyon. According to management, indications are that the grant of the permit is imminent, and it is likely that potential partners are waiting for the permit grant to complete a deal to explore the project.

Regarding the Tim project, Coeur Mining, the operator of the JV, has completed a reconaissance exploration program, which included a SkyTEM airborne geophysical survey that was followed up by mapping, trenching and soil geochemical surveys. According to CEO Weber, results of this program are not complete yet, but Coeur has indicated its desire to conduct additional trenching and followed by diamond drilling in 2022.

Regarding the Yanac Copper project in Peru, Pedro Castillo has finally been chosen for president, unfortunately he is vehemently anti-mining, notwithstanding this management is actively talking to potential partners in order to drill test the copper porphyry target here, discussions are ongoing.

Alianza Minerals also announced the first acquisition under the recently formed Strategic Alliance with Imperial X (now called Cloudbreak Discovery, PLC), involving the Klondike Project, located in Colorado, US. Management views this as an excellent opportunity to explore for economic copper mineralization, as the project has the following highlights:

Alianza is currently actively exploring the project, and just finished a sampling program, which already generated numerous copper showings like this one:

According to CEO Weber, the alliance partners have a group interested in taking on the Klondike project. They expect this new group to push the exploration towards drilling quite quickly, so the application for a drill permit has been initiated. It is conceivable that a drill program could be completed in 2022.

As a reminder, the strategy of the alliance is to acquire and explore copper deposits in the United States, more precisely in Arizona, Colorado, New Mexico and Utah. Under the terms, either company can introduce projects to the Strategic Alliance. Projects accepted will be held 50/50 but funding of the initial acquisition and any preliminary work programs will be funded 40% by the introducing partner and 60% by the other party. Weber stated to me that they have another acquisition closing soon, and he is headed to Colorado in early October to look at Twin Canyon, Klondike and potential targets for the Strategic Alliance.

Conclusion

The Haldane project, and more specifically the West Fault target, keeps returning (very) economic intercepts. Management believes that the strongest, thickest and potentially highest grade mineralization may lie along strike to the southwest and down plunge. It will be very interesting to see if Alianza Minerals will finally be able to hit Alexco type of intercepts, hereby proving the possibly equal mineral potential of their own claim package, as it is part of the same geological formation at Keno Hill. Besides Haldane, there are a number of other projects under exploration, of which Tim, Klondike and new copper acquisitons can be expected to provide news results prior to Christmas. Tim results should be interesting, especially with early indications of a 2022 drilling program providing exposure to another high grade silver project.

I hope you will find this article interesting and useful, and will have further interest in my upcoming articles on mining. To never miss a thing, please subscribe to my free newsletter, in order to get an email notice of my new articles soon after they are published.

Disclaimer:

The author is not a registered investment advisor, and currently has a long position in this stock. Alianza Minerals is a sponsoring company. All facts are to be checked by the reader. For more information go to www.alianzaminerals.com and read the company’s profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.

Mt Haldane

 

Vior Prepares To Drill Prospective Belleterre Gold Project; Samples Return Strong Results Up to 274.9g/t Au

 

Preview

Vior (TSXV:VIO)(FRA:VL51)  currently has an attractive project portfolio, a prospective flagship gold project, capital structure and high-quality core investor base for its market capitalization. The stock has consolidated on improving trading volume since February 2021 and is at an attractive entry point for new investors. Based on its current market capitalisation, Vior seems to be one of the better risk/reward exploration plays in the sector. Cash and investments at C$4M, its outstanding portfolio of projects, the flagship project Belleterre which contains the historic Belleterre Mine (produced 750koz Au @10.7g/t and 95koz Ag between 1936 and 1959) with recent and excellent sampling results (up to 274.9g/t Au), safe jurisdiction (Quebec), strong management team and cornerstone investor base including Osisko Mining are all arguments that support the investment thesis. It is anticipated that strong drill results, positive gold price movements and potential asset sales/spin-off are potential catalysts which could drive the price higher throughout the balance of 2021.

Investors are encouraged to review the Key Points at the end of this article for a quick snapshot of the company.

All pictures are company material, unless stated otherwise.

1. Introduction

Not often do you see a junior explorer consolidating prospective grounds in the backyard of Osisko companies the way Vior Inc. (TSXV:VIO)(FRA:VL51) has. This Montreal based explorer has assembled some impressive property packages, most notably their flagship Belleterre gold project and Skyfall project (on trend with Osisko’s Windfall gold project), both in Quebec. Belleterre has been consolidated into an impressive 291 sq km land package (531 claims), as the company recently negotiated an Option agreement to acquire up to 75% ownership from Osisko Mining Inc. for the last significant piece of the historic Belleterre mining camp.  Vior raised C$2.4M on March 31, 2021, and recently announced strong gold. sampling results at Belleterre. All but one sample contained gold, and 20 out of 38 samples returned gold values above 10g/t Au, with the three highest grade samples coming in at 274.9g/t Au, 121.3g/t Au and 77.4g/t Au. These impressive results validate 10 historic gold showings, and confirm the high exploration potential at Belleterre.

After a month of field exploration at Skyfall, which included till and grab samples, the company is expecting results this Fall. The success of the results will dictate the next steps in the exploration process. Management’s expectations are high and the next phase could include the generation of drill targets. Vior also has an equity investment in Ridgeline Minerals Corp (TSXV:RDG) valued at C$1.82 million. Ridgeline is exploring 4 highly prospective gold projects in Nevada and plans to spend over C$5M on exploration in 2021.

There are 72.94M shares outstanding (fully diluted 92.79M), 14.87M warrants (@C$.15 to C$0.30 and expiring in July/2022 and March/2023) and several option series to the tune of 4.98M options in total, the majority priced at C$0.10 and C$0.13 and expiring in 2024 and 2027.  Vior has a current market capitalization of C$15.32M based on the September 17, 2021 share price of C$0.21.

Vior Inc, 5 year timeframe (Source: tmxmoney.com)

The current cash position of Vior is approx. C$2.2M, and the company is looking to raise more soon. The all-in cost of diamond drilling in the lower Abitibi region of Quebec is extremely cheap at approx.  C$160/m. In addition, there are significant tax incentives for Flow Through capital raises dedicated to exploration in Quebec. Vior is looking to raise another C$1M+ sometime this Fall, as it prepares to commence drilling on their Belleterre project in early November, 2021. Management holds no less than 16% of the current shares outstanding (CEO Fedosiewich holds approx. 10.5%), close strategic holders own approx. 30%, and the company also enjoys approx. 16% institutional ownership (including SIDEX, a Quebec sponsored junior exploration fund, FTQ, the labour sponsored pension fund and 2 other regional Quebec based funds). Osisko Mining owns a 6.7% non-diluted position.

2. Management

3. Projects

Vior owns a portfolio of ten projects, however, it’s exploration focus is clearly on the Belleterre and Skyfall projects as mentioned. The Company also views the Ligneris project as a strategic asset in the portfolio as it comprises a near district scale gold rich VMS target and is located near Amex’ Perron project. A disciplined approach and strategy has been deployed to acquire their recent projects, and these need to comply with the following strict criteria:

Nine out of Vior’s 10 projects are located in Quebec, one of the most mining friendly jurisdictions worldwide. Vior also has their early stage Tonya project in Nevada, USA,  which is the top ranked jurisdiction according to the Fraser Institute Survey.

Belleterre Project

The current focus for Vior is clearly locked on their flagship Belleterre property. After consolidating the last and central piece of the puzzle, the company has assembled a district-scale land package with a strike length of 37km:

This land package has never been consolidated on this scale before, is located on a Greenstone Belt with favorable mafic volcanics, includes the historic high grade Belleterre Gold Mine (produced 750koz Au @10.7g/t and 95koz Ag between 1936 and 1959), has good infrastructure and has several gold milling facilities with available capacity nearby, and the entire area is very underexplored ever since. Adding to this, previous drilling did not exceed 250 meters. Notwithstanding this, numerous gold showings have been detected in limited sampling in the recent past (2019). Vior has completed several reconnaissance exploration programs this year, among those an airborne magnetic survey in May, and field work in July and August with the aforementioned, impressive sampling results.The company has also recently completed a validation of the historical data at and around the former Belleterre Gold Mine which will help in completing their new 3D Model. This compilation and validation work will assist in better defining priority targets for an upcoming 4,000m drill program that will commence in November 2021.

The Belleterre project is, aside from the majority of the claims already 100% owned by Vior, largely subject to 3 Option agreements: with JAG Mines Ltd, 9293-0122 Quebec Inc. and Osisko Mining Inc. The Option with JAG allows Vior to acquire 100% of this specific land package for C$2.3M in cash and/or shares, and C$2M in exploration expenditures, over the course of 4 years, with C$2M of the C$2.3M in cash or shares scheduled for the last year, representing very little payment obligations until June 31, 2025. JAG holds the equivalent of a 1% NSR over the property.

The purchase option with 9293-0122 Quebec Inc, which covers the Belleterre Gold Mine and its direct surroundings, allows Vior to purchase a 100% interest, by paying C$2.1M in cash and/or shares before 2023 year end or thereabouts, and with no exploration expenditures. There will be no royalty involved on these claims. This purchase option was arranged during the main consolidation acquisition phase for the Belleterre project, when numerous other claims were acquired from other parties. Most of these parties were granted a 1% NSR, and Globex was granted a 2% gross metal royalty.

The option agreement with Osisko Mining allows Vior to acquire up to 75% of Osisko’s current interest in their Belleterre properties (see above at the map claims Osisko in black). 51% can be acquired by issuing C$225k in shares over 3 years and by incurring C$1.25M in exploration expenditures before August 2024. Vior has the right to acquire another 24% by incurring another C$1.75M in exploration expenditures within 3 years after exercising the 51% option. No royalty is part of this deal, unless the interest of one of the JV partners drops below 10%.

The most impressive feat for me is that Vior managed to consolidate this entire district play right under the nose of Osisko Mining, as Osisko was obviously interested. Maybe Osisko didn’t have the best negotiation position with all the vendors, as a rising gold price and a big name probably drives up prices to the point that Osisko decided to wait, and focus on other projects. A small stake in the project, and an equity stake in Vior might prove to be an interesting alternative for Osisko.

Skyfall project

The second most important project for Vior is the Skyfall project, also located in Quebec. This is an equally large land package of 26,758 ha (260.6 sq km), and 100% owned by Vior. It is located adjacent to the East of the Windfall deposit (6M+ oz Au resource, owned by Osisko Mining), and the Gladiator and Barry deposits (combined 2Moz Au resource, owned by Bonterra). Management could consider doing a JV with players in the area which include Osisko and Bonterra.  The interesting thing is that this package covers the eastern extension of the Urban-Barry Greenstone Belt, and is very under-explored, due to limited land access until a few years ago. As can be seen, it isn’t directly next door to Windfall but the geologic makeup of the property (Greenstone) combined with the inclusion of a major fault zone and gold showings makes this land package at the very least reasonably prospective for gold exploration.

A till sampling program from March of this year provided lots of gold samples, and on top of this 7 clusters were identified which created lots of enthusiasm with company geologists and management, but unfortunately this type of sampling cannot be translated or extrapolated into g/t Au samples, so there is gold, but how much exactly will have to be verified by standard sampling first. The till sampling results can be seen on this map:

Vior commenced field exploration in May of this year on Skyfall, and completed this program in August. It consisted of prospection, mapping, stripping, channel sampling and more till sampling. The company expects to release results from their Skyfall field program when received this Fall. These results will determine the next phase of exploration which may include drill target generation.

Other projects

Vior sees their Ligneris project in Quebec as their third priority, and has budgeted C$250k for exploration expenditures. It was optioned out to Ethos Gold Corp, but they decided to return it to Vior for a compensation of 1M Vior shares (plus 1M full 3 year C$0.30 warrants, for exploration expenditures incurred) in April of this year, as 2020 drill results did not generate sufficient economic grades, after historic drilling returned impressive results like 13.5g /t Au over 10.5m, 62.1 g/t Au over 2.9m and 5.1g/t Au over 5.9m.

Other projects which will see limited exploration (sampling) this year are Mosseau and Mirabelli (both in Quebec) and Tonya (Nevada, US), of which Mosseau has already seen some drilling in 2017 by Vior, intercepting 2.93g/t Au over 4.5m from 40m and hosting an approx. 40,000 oz Au non-compliant resource.

4. Key points

As with all early stage explorers, chances of success are almost binary. In the case of Vior there are several chances for a discovery, and with Belleterre lots of brownfield exploration could lower the risks considerably. And I wouldn’t underestimate Skyfall or their investment in Ridgeline either.  Stay tuned!

Follow progress of Vior here on social media:

Twitter: twitter.com/semVior

Linkedin: linkedin.com/company/Vior-inc

I hope you will find this article interesting and useful and will have further interest in my upcoming articles on mining. To never miss a thing, please subscribe to my free newsletter, in order to get an email notice of my new articles soon after they are published.

Disclaimer: 

The author is not a registered investment advisor, and currently has a long position in this stock. Vior Inc. is a sponsoring company through a third party. All facts are to be checked by the reader. For more information go to www.Vior.ca and read the company’s profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.