Metallic Minerals Corp. (MMG:TSX.V; MMNGF:OTCQB) has announced the final results from its 2022 drilling campaign at its flagship 100%-owned Keno Silver project in the Yukon Territory.
A total of 642 meters were drilled in six holes at the Caribou target to test extensions of known high-grade and bulk-tonnage mineralization as the company works toward a National Instrument 43-101 resource estimate for the project this year.
Hole CH22-01 intersected two higher-grade vein intervals within a broad zone of bulk tonnage mineralization, including 348 grams per tonne silver equivalent (g/t Ag eq) over 0.5 meters, and 1,201 g/t Ag eq over 0.5 meters bounding a zone of 34.2 meters grading 38 g/t Ag eq.
In a March 21 research note, Couloir Capital wrote that it expected the results to be "instrumental in advancing Keno Silver to its maiden resource milestone."
"We expect MMG to focus near-term initiatives on filling in the gaps and advancing them toward a first resource estimate," the note said. "Thus far, MMG has been successful in drilling discovery holes that point to both bulk-tonnage and high- grade mineralization at Keno Silver, which we see as a positive indicator of a potentially robust resource at the property."
Couloir maintained its Buy rating on the stock and with a fair value per share estimate of CA$0.75.
In a March 21 research note, Couloir Capital wrote that it expected the results to be "instrumental in advancing Keno Silver to its maiden resource milestone."
Metallic Minerals President Scott Petsel said Caribou "shows excellent potential for resources of significant scale."
"We are continuing to demonstrate the extensive exploration potential of the district," he said.
Metallic Minerals has retained SGS Geological Services to complete the estimate. The company said modelling work is already underway.
The Catalyst: A Historic Silver District
The Keno Silver project is in the historic Keno Hill Silver District of the Yukon, which has produced more than 200 million ounces (Moz) Ag at an average grade exceeding, 1,300 g/t, the company said.
The district also hosts Hecla Mining Co.'s (HL:NYSE) Keno Hill mines, which features an estimate life-of-mine production grade of 804 g/t.
Metallic Minerals said its project covers mainly the eastern portion of the district and was host to eight historical silver mines, five of which had average production grades about 5,000 g/t.
"Metallic Minerals’ work to date in this area shows the presence of a major structural corridor that is comparable in surface expression and structural setting to the +150 (Moz) Bermingham-Calumet system in the extensively explored western part of the district," the company said in its release on the Keno results.
The company said it completed 3,265 meters of diamond drilling over 23 holes at Keno Silver in 2022. It also completed LiDAR data collection geophysics scans.
The southernmost target hole, CH22-05, at Caribou returned 1,310 g/t Ag eq over 0.5 meters at 44 meters depth.
The company said in total at Keno Silver in 2022, there were 138 significant intervals of greater than 100 g/t Ag eq and 22 intervals over 500 g/t Ag eq over 23 holes. A "robust" drilling program meant to expand the resource and test new targets is planned for this year.
Maintaining Momentum
The company completed an NI 43-101 resource last year for its La Plata copper-silver-gold-platinum group project in Colorado.
It found 889 million pounds Cu and 14.975 Moz Ag at an average grade of 0.39% Cu Eq, 0.35% Cu, and 4.02 4.02 g/t Ag, using a 0.25% Cu Eq cutoff grade.
Two holes totaling 1,730 meters hit 816 meters of 0.41% recovered copper equivalent (Cu eq), which the company said was "one of the top intersections for any North American project for the past several years."
Metallic Minerals said it is working on modeling work for an updated resource estimate for La Plata, as well, anticipated by mid-2023.
The company has also signed a production royalty agreement with Little Flake Mining, a company owned and operated by Parker Schnabel of the Discovery Channel's "Gold Rush" program, on 5 miles of alluvial gold claims at Australia Creek in the Klondike Gold District of the Yukon.
Schnabel was granted exclusive rights to extract gold from the property while giving Metallic Minerals a percentage of the production as a royalty.
Streetwise Ownership Overview*
Metallic Minerals Corp. (MMG:TSX.V; MMNGF:OTCQB)
"With a positive 2022 exploration program and a celebrity royalty deal, we believe MMG will look to build on recent strength and maintain momentum going into the rest of 2023," Couloir wrote.
Ownership and Share Structure
About 19% of Metallic Minerals is owned by management and insiders, including Chief Executive Officer Greg Johnson with 4.67% or 7.05 million shares, Independent Director Gregor Hamilton with 0.91% or 1.37 million shares, and the president, Petsel, with 0.56% or 850,000 shares.
About 30% is owned by strategic investors, including mining financier Eric Sprott, who owns 14%.
About 29% is owned institutionally. The rest, 20%, is retail.
Its market cap is CA$39.91 million, with 150.9 million shares outstanding, 120 million of them free-floating. It trades in a 52-week range of CA$0.49 and CA$0.195.
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Disclosures for Couloir Capital, March 21, 2023:
This report has been prepared by an analyst on contract with or employed by Couloir Capital Ltd. The analyst certifies that the views expressed in this report which include the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report accurately reflect his or her personal views about the subject securities and the issuer. No part of his / her compensation was, is, or will be directly or indirectly related to the specific recommendations.
Couloir Capital Ltd. is affiliated with Couloir Securities Ltd., an Exempt Market Dealer. They shall be referred to interchangeably as Couloir Capital herein. Part of Couloir Capital's business is to connect mining companies with suitable investors that qualify under available regulatory exemptions. Couloir Capital, its affiliates, and their respective officers, directors, representatives, researchers, and members of their families may hold positions in the companies mentioned in this document and may buy and/or sell their securities. Additionally, Couloir Capital may have provided in the past and may provide in the future, certain advisory or corporate finance services and receive financial and other incentives from issuers as consideration for the provision of such services.
Couloir Capital has prepared this document for general information purposes only. This document should not be considered a solicitation to purchase or sell securities or a recommendation to buy or sell securities. The information provided has been derived from sources believed to be accurate but cannot be guaranteed. This document does not consider the particular investment objectives, financial situations, or needs of individual recipients and other issues (e.g. prohibitions to investments due to law, jurisdiction issues, etc.) which may exist for certain persons. Recipients should rely on their own investigations and take their own professional advice before investing. Couloir Capital will not treat recipients of this document as clients by virtue of having viewed this document.
Company-specific disclosures:
- In the last 24 months, Couloir Capital Ltd. has been retained under a service agreement by the subject issuer. This service agreement includes analyst research coverage.
- The views of the Analyst are personal.
- No part of the Analyst’s compensation was directly or indirectly related to the specific ratings as used by the research Analyst in the Reports.
- The Analyst DOES NOT maintain a financial interest in the securities or options of the Company.
- Couloir Capital DOES NOT maintain a financial interest in the securities or options of the Company.
- The information contained in the Reports is based upon publicly available information that the Analyst believes to be correct but has not independently verified with respect to truth or correctness.
