Idaho's Bureau of Land Management (BLM) manages six herds of wild horses that roam freely among Idaho's many idyllic mountains, streams and grassy plateaus. It's a considerable natural resource.
In Valley County, Idaho, Stallion Gold Corp. (STUD:TSX.V; HM4:FSE) is buying a 100% interest in the Horse Heaven gold project, a nod to the state and what the junior hopes will one day be its own sizeable resource. Stallion even registered its ticker on the TSX Venture Exchange as STUD. (Perhaps PONY did not leave the desired impression.)
The exploration team, led by Vice-President of Exploration and President Bill Breen, a native Idahoan, has recently collected about 1,000 soil samples on its 695-claim, 5,644-hectare block.
"We believe (sampling) will lead to some very interesting results and further our understanding of the geology and mineralization present at Horse Heaven," Breen says.
The samples are currently undergoing geochemical analysis in a lab.
Those results will be followed by ground and very-low-frequency (VLF) geophysical surveys along the Golden Gate Fault Zone—the program's priority target.
Those surveys will be followed by induced-polarization or Controlled Source Audio Frequency Magneto-tellurics (CSAMT), which helps mineral exploration companies find underground drill targets by measuring underground resistivity – the more resistive the target, the greater the magnetic signature and the more likely it is to be drilled.
Stallion will be using the updated geochemical and geophysical survey data to identify a series of drill targets throughout the high priority Golden Gate Fault zone. Stallion will use these target areas to apply to the U.S. Forest Service for the necessary permits.
"We're working hard to make sure we get the next phases of our geophysics done. So that we're not just rushing things, but we're putting things in the right place at the right time to be able to have the best drill holes possible," Stallion Gold CEO Drew Zimmerman tells Streetwise Reports.
Stallion management believes that gold mineralization at Horse Heaven is in a structurally controlled epithermal system along the Golden Gate fault, the same fault that hosts Perpetua Resources' (PPTA:NASDAQ; PPTA:TSX) Stibnite gold project, which shares its western boundary with Horse Heaven.
At Stibnite, Perpetua, formerly Midas Gold, has outlined more than 6 million ounces gold in a National Instrument 43-101-compliant resource (Measured and Indicated), making it one of the largest gold resources in the US.
A 2021 feasibility study on Stibnite, using US$1,600/oz gold, projects annual production of 465,000 oz from an open pit for 15 years at all-in sustaining costs of less than US$450/oz.
Barrick Gold (GOLD:NYSE; ABX:TSX) helped finance the feasibility study and now owns roughly 10% of Perpetua, while privately held hedge fund Paulson and Co. owns a 40% stake.
The Stibnite region has been mined on and off for more than 100 years. After Superior Oil resurrected Stibnite as a seasonal heap-leach operation in the early 1980s, several companies took turns mining it before production shut down in the late 1990s. All in all, the mine has produced about 980,000 oz gold.
Idaho's welcoming attitude toward mining and prospective geology have led to it being home to a number of gold projects. In its 2020 survey of mining company executives, Canada's Fraser Institute ranked Idaho tops in the policy perception category and ninth in investment attractiveness.
Stallion has a three-stage buy-in option on Horse Heaven. The first stage was completed earlier this year when Stallion, formerly Hybrid Minerals, paid CA$400,000 and 12 million shares to the property vendors, Horse Heaven Nevada.
The same amounts are due on the first and second anniversaries of the effective date of the agreement, which would bring the total cost to CA$1.2 million and 36 million shares.
As part of the deal, Horse Heaven property is subject to separate royalties: 4% on the entire project (1% can be bought back for US$2M); 4% on 10 historical claims (up to 3% can be bought back for US$100,000 per percentage but there is no buyout on the final 1%).
Zimmerman tells Streetwise Reports that the royalties are unlikely to inhibit a takeover bid at some point down the road.
"If we really get to the point where the NSRs become a much more binding term of this contract, like we hope they will be, we'll be having that conversation at a much different market cap than where we are right now," Zimmerman explains.
Despite the royalties, Zimmerman says a key to the deal was ensuring that Breen, a geologist who helped stake the original property claims, would join Stallion.
"Being able to bring on Bill Breen, as he knew this property very well, has been a tremendous asset. He has known this piece of land for quite a while and had done some early work on it. He's been able to step in and really hit the ground running," Zimmerman tells Streetwise.
Breen joins Zimmerman who spent almost a decade as a derivatives portfolio manager and financial adviser at PI Financial before stepping into the mining space.
Other board members include Jay Martin, CEO of Cambridge House International, which runs a series of mining-related conferences, and advisor Stephen Stanley, who was president and CEO of Hathor Uranium before it was acquired by Rio Tinto (RIO:NYSE) for CA$654 million.
Aside from the historical gold production in the area, almost 90 million pounds of antimony and 13 million pounds of tungsten were mined from the Stibnite project during World War II and the Korean War to make bullets and armaments. Antimony is now considered a critical resource.
"There is no current production of antimony in the United States, so the U.S. is totally dependent on importing antimony from other places," Zimmerman says, adding that Stallion will examine the economics of mining antimony alongside any gold.
China accounts for about half of the world's antimony, while Russia supplies about 25%.
Stallion trades in a 52-week range of $0.10 to $0.75. Fully diluted there are around 50 million shares outstanding.
Stallion recently topped up the treasury with a non-brokered private placement totaling $2 million.
The money will fund ongoing exploration work at Horse Heaven.
Giddy up!
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Disclosure:
1) Brian Sylvester compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. His company has a financial relationship with the following companies referred to in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Stallion Gold. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
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4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Stallion Gold, a company mentioned in this article.
