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 Fri Mar 15, 2024
KW Excerpt: Kaiser Watch March 15, 2024: Solitario Resources Corp (SLR-T)
    Publisher: Kaiser Research Online
    Author: Copyright 2023 John A. Kaiser

Solitario Resources Corp (SLR-T: $0.670)

Kaiser Watch March 15, 2024: A staking frenzy in America?
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(0:10:13): What is the latest news from Solitario Resources Corp about its Golden Crest project in South Dakota?

Solitario Resources Corp provided an update on February 27, 2024 ahead of PDAC which highlighted a new gold zone called Wild Rose which appears to be part of a 4 km northeast trend extending from the Downpour showings first reported in 2021. Solitario applied to the USFS in 2022 for a plan of operations that would allow it to drill targets generated by surface sampling on the Golden Crest project in the western part of the Black Hills National Forest in South Dakota. The property boundary extends almost to the Wyoming border, and when I asked if there was a reason to avoid Wyoming, the answer was that there is a structural break in the rocks that happens to coincide with the Wyoming-South Dakota border, to the west of which the geology is not prospective for gold mineralization.

The 75 day comment period following the FONSI ruling by the USFS in December 2023 with regard to the first plan of operations application Solitario filed in 2022 has concluded and the USFS is preparing its responses to those comments that have standing. Solitario's COO Walt Hunt thinks the USFS may be finished by mid April, which is still a month ahead of when Solitario in terms of physical access could hope to start drilling at Golden Crest. The USFS has published a project location map which outlines the prospects for which drill permits are sought. On March 18, 2024 (after this KW episode was recorded) Solitario published an update about the Geyser Zone which it first reported on in February 2024. Once again surface sampling has yielded multi-ounce gold values.

What is intriguing is Solitario's announcement that it has filed the Ponderosa Plan of Operations which it describes as being a non-contiguous part of the Golden Crest project which the December 2023 presentation depicts as 3 distinct claim blocks. When I google Ponderosa POO I get a USFS splash page which contains no information other than the approximate location, which turns out to be east of Highway 85 which tracks Spearfish Canyon. Although Solitario's map shows 3 claim blocks, a medium sized one to the north, a small one to the northwest, and the main large one, the latter is in fact a couple blocks because Solitario had the wisdom not to stake claims over sensitive areas like Spearfish Canyon.

At PDAC I took a photo of a dull looking rock which assays just under 1 opt gold, a testament as to why this western part of the Black Hills has 1,500 prospect pits (based on LIDAR analysis) compared to a hundred times as many in the eastern half where Homestake yielded 60 million ounces out of a 90 million ounce endowment for the area. CEO Chris Herald tells me that no claims have been staked since the end of 2022, and admits they were surprised to discover the Geyser Zone and were obliged to expand the land package. It turns out that the new Wild Rose zone is outside both the original Golden Crest POO and the Ponderosa POO applied for in 2022. Based on the prospect pit locations in the original Golden Crest POO and the recently revealed location of the Ponderosa POO the impression is created that the middle of the land package is an unprospective doughnut hole. That, however, is an artifact of the permitting strategy which has limited Solitario's surface sampling focus to areas accessible by logging roads and where bedrock has been exposed thanks to logging.

Last year Solitario conducted an IP survey along two 11 km lines which yielded a weak, 2 km wide chargeability high projected around a depth of 400 m just above the Precambrian basement where the Lower Deadwood formation that hosts the Wharf gold system, a 10 million ounce system with high grade zones within a lower grade envelope whose high grade was plucked out 120 years ago, with the rest being open pit mined since the 1980s after heap-leaching technology was invented. If something similar is present within this doughnut hole ay Golden Crest it would have to be underground mined, but with the high grade intact such a system might run 2 g/t gold or better which is $129 rock at $2,000 gold. Both this deep IP target and Wildrose will have to wait for future plan of operation applications. If the permit is granted drilling would start at the Downpour target for which Solitario has provided a conceptual target cartoon which shows a laterally extensive Wharf style target within the Deadwood Formation just above the Precambrian basement, and gold mineralization within the feeder structures which they are tracing with high grade surface values. Oddly, during the past week Solitario came under selling pressure through its NYSE listing which may have been a forced liquidation by an institutional shareholder. Such liquidity on the bid side will be a thing of the past if the USFS decides to confirm the Golden Crest POO.

Regional Map showing locations of Solitario's Plan of Operations Applications

Map showing location of new Wild Rose target relative to Downpour

Conceptual cartoon of Golden Crest targets using Downpour as example


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