| Kaiser Watch June 30, 2022: Summer drill plays for discovery bets |
| Jim (0:00:00): What did the final results from Endurance Gold's RC drill program at Reliance tell us? |
Endurance Gold Corp has an emerging discovery at its Reliance gold project which is now the focus of an 8,000 m core drilling program this summer. The company just reported final results for the spring RC program which has now extended the Eagle Zone for 400 m and still going strong. This Bottom-Fish Spec Value rated junior has been unable to break out of the $0.30-$0.40 range due to market concern that the Eagle Zone which developed within the 300 m wide Royal-Treasure shear corridor may not have million ounce plus gold potential because the shallow dip of the Eagle Zone gets truncated by a thrust fault at the western margin of the corridor. However, in 2021 core hole 21-20 in the Eagle South extension appeared to demonstrate that there is a flexure that turns the Eagle Zone sub-vertical. As this is an epizonal orogenic gold system tonnage could be developed to a substantial depth. The RC program demonstrated that the shallow portion of the Eagle Zone is still strongly mineralized at the SE limit of the 1,500 m trend. The core rig is now drilling along the 200 m segment of the 020 Zone, formerly called Eagle South, in an effort to prove that the sub-vertical flexure continues at depth. 5 holes for 1,109 m have so far been drilled; EDG is not describing them and is not reporting XRF read arsenic values because such readings are unreliable for core, but these will still be too shallow to confirm the hypothesis. It will likely be August when deeper holes have been drilled before we know if the 020 Zone persists at depth. Failing that, EDG will continue to push the road up the hill where a gold in soil geochemical anomaly suggests the Eagle Zone continues. EDG does not have a significant warrant overhang. |
Endurance Gold Corp (EDG-V)
Bottom-Fish Spec Value |
 |
 |
| Reliance |
Canada - British Columbia |
3-Discovery Delineation |
Au |
Long Section of Entire Reliance Gold System - 1.5 km strike |
Plan View of 400 m strike of Eagle Zone at Reliance |
Long View of 400 m Eagle Zone at Reliance |
Warrant Table for Endurance Gold Corp |
| Jim (0:04:18): Copper Lake reported very high silver grades for its Marshall Lake project. What does it mean and what happens next? |
Copper Lake Resources Ltd attracted my attention in January while it was drilling the Deep IP target at its Marshall Lake VMS project in Ontario. The stock slumped below $0.10 in May when it became apparent from the visuals of the 2 holes that a major massive sulphide zone had not been intersected at the projected 250-300 m depth though 22-01 had 6 short interesting sulphide intervals between 137-374 m of the 430 m angled hole. A down hole EM survey was completed on 2 of the 3 holes in this area though not 22-01 due to an unfortunate blockage; it revealed 4 strong conductors at 250-300 m vertical depth in the middle of the Deep IP anomaly. The survey is limited to a 100 m radius of the hole and thus subject to various interpretations with regard to orientation and geometry. These would not have been visible for surveys done in the 1990s. It is interesting that the 2.2 million tonne Billiton deposit which is close to surface does not have any strong conductors. The stock perked up in late June when CPL first reported high base metal grades for 22-01 and then very high silver values for the 4 intervals from 272 m onwards. While Billiton has spikes to 200 g/t Ag, nothing close to the 1,580 g/t in hole 22-01. The disappointment for the 2022 drilling has been that there is no giant Kidd Creek style VMS deposit at depth. But the higher Cu-Zn grades coupled with high silver grades and the conductors at depth suggests we may have an Eskay Creek setting associated with the Deep IP anomaly which Don Hoy now interprets as reflecting the former sea floor stratigraphy tilted on its side, with the Billiton Zone itself a possible feeder related to it. This clearly is an "evolving situation" and the only answer is to drill several more deep holes into the conductors. Copper Lake will have to finance and plans to raise $2 million shortly, which means more dilution. But a rig with a more competent operator than the winter drilling group has been secured. And the market is not pricing any success for this Bottom-Fish Spec Value rated junior. A key obstacle is a $0.10 warrant overhang that does not expire until Q2 2023. |
Copper Lake Resources Ltd (CPL-V)
Bottom-Fish Spec Value |
 |
 |
| Marshall Lake |
Canada - Ontario |
3-Discovery Delineation |
Cu Au Ag Zn |
Marshall Lake Hole 22-01 Results with Plan and Long Views of Deep IP Target |
Visuals and Final Results for Hole 22-01 at Marshall Lake |
Location of Down Hole Conductors within Deep IP Target |
Warrant Table for Copper Lake Resources Ltd |
| Jim (0:14:38): Did Adamera Minerals ever get a permit so that it can start drilling Buckhorn 2.0 this summer? |
Adamera Minerals Ltd has state and BLM permits to begin testing 10 of 17 targets at its Buckhorn 2.0 project. The USFS is still struggling to get its act together and Mark Kolebaba remains optimistic. The initial drilling will focus on targets to the northwest of the Buckhorn 1.0 lease still owned by Kinross. Work by Kinross generated gold in soil anomalies in this area but little if any drilling has been done in this area though clearly this was part of the giant plan of operations Kinross pursued that hit a USFS wall. ADZ managed to get the Kinross data and has added several of its own data sets such as ground mag, a test VLF survey in the NW area, and a Lidar survey which helped it confirm known diggings by old-timers and unknown diggigs. The west flank of the Torodo Graben saw lots of prospecting interest in the past century but yielded nothing until a junior called Crown undertook a drill program in the late 1980's which discovered the Crown Jewel skarn hosted gold deposit which Kinross developed as an underground mine that yielded 1.3 million oz at 13 g/t grade. Compare that to the 8 million ounces mined from deposits found on the flanks of the Republic Graben to the east. Adamera has been trying to find "over-looked" zones in that area which it calls Cooke Mountain and in which Hochschild can earn 75% but no luck so far. In contrast Buckhorn 2.0 has seen little modern exploration but there is enough gold smoke to raise hopes that another Crown Jewel or better skarn hosted gold deposit remains to be found. Adamera has $1 million working capital, enough to test 10 targets. The stock will need something resembling a discovery hole to break through a lid of $0.10 warrants. I have done an outcome visualization as to what Buckhorn 1.0 would be worth today and developed in the same manner using the idled Kettle River mill. At the current gold price a Buckhorn clone would have an after-tax NPV of about CAD $1 billion or about $4 per share for ADZ at 242 million fully diluted. If a discovery hole is pulled the exercise of the warrants would raise $2.8 million; it is helpful that they are in friendly hands. |
Adamera Minerals Corp (ADZ-V)
Bottom-Fish Spec Value |
 |
 |
| Buckhorn 2.0 |
United States - Washington |
2-Target Drilling |
Au |
Why has Republic Graben been so much more productive than the Torodo Graben? |
Integrating old and new data sets to rethink the Buckhorn gold district |
Buckhorn 1.0 would be worth CAD $1 billion today |
A Buckhorn 1.0 clone discovery would imply a future $4 plus price for Adamera |
Warrant Table for Adamera Minerals Ltd |
| Disclosure: JK owns shares of Adamera and Endurance; Adamera, Copper Lake and Endurance are Bottom-Fish Spec Value rated |
