Vancouver Explorer Sees Results at Flagship Silver Project in Yukon

Metallic Minerals Corp. (MMG:TSX.V; MMNGF:OTCQB) announced the results of its 2023 drilling campaign at its 100%-owned flagship Keno silver project, which is adjacent to Hecla Mining Co.'s (HL:NYSE) Keno Hill operational mining operations in the central Yukon Territory.

Metallic drilled 1,112 meters in four diamond-drill holes centered on expanding the Formo target in the West Keno area, which is on trend with the 100 million-ounce (Moz) historic Hector-Calumet mine owned by Hecla. 

Hole FOR23-03 returned one of the best intercepts to date for the Keno project, with 256.8 grams per tonne silver equivalent (g/t Ag Eq) recovered over 46 meters, including 462 g/t Ag Eq over 24 meters,  900 g/t Ag Eq over 8 meters and 3.3 m of 1,413.45 g/t Ag Eq.

"The Formo target is an exciting, advanced exploration stage 'resource-ready' target with significant room to grow featuring both high-grade and bulk mineable widths that make it amenable to lower-cost mining methods," said Metallic Minerals President Scott Petsel.

Formo is located near infrastructure as it is adjacent to the Silver Trail highway (Highway 11) and the power lines that feed the central Keno Hill mill. It also directly adjoins Hecla's Keno Hill property, where Hecla is actively mining the nearby Bermingham mine," Petsel said.

The company said Formo is expected to be one of the biggest contributors to its inaugural National Instrument 43-101 mineral resource estimate (MRE) for Keno, which is nearing completion by SGS Geological Services.

"Silver will move higher in 2024 because the top in Yields is confirmed," Investing Haven wrote. "The U.S. Dollar did already confirm its inability to move much higher. Both are supportive developments for precious metals."

Petsel said the company anticipates reporting more results from Keno and its La Plata project over the next few weeks as it attends upcoming industry events like the Vancouver Resource Investment Conference and the AMEBC Mineral Roundup Core Shack later this month, and the Prospectors and Developers Association of Canada Annual Convention (PDAC) in Toronto in March.

"These results from Formo continue to demonstrate our ability to build a significant resource base for the project," Petsel said. "The Keno Silver resource estimate is expected to be complete in Q1 2024."

Metallic said hole FOR23-03 is also the deepest intercept to date on the Formo vein structure. The company said mineralization remains open and down dip along strike.

The Catalyst:  Analysts Bullish Silver's Future This Year

The Keno Silver project is in the historic Keno Hill Silver District of the Yukon, which has produced more than 200 Moz silver (Ag) at an average grade exceeding 1,300 g/t, the company has said.

Hecla's Keno Hill mines, also in the same district, feature an estimated life-of-mine production grade of 804 g/t and a fully operational mill complex, highway access, and grid power.

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 of over 1,000 g/t.

In total, at Keno Silver in 2022, there were 138 significant drill intervals of greater than 100 g/t Ag Eq and 22 intervals over 500 g/t Ag Eq over 23 holes, the company said.

Those results, combined with results from Keno and a royalty agreement signed with Parker Schnabel of the Discovery Channel's "Gold Rush" on other claims in the Yukon, led Couloir Capital to rate the stock a Buy last year.

The precious metal opened the year at US$23.08 per ounce Thursday, but some analysts are very bullish on its future this year. Investing Haven predicted a target price of US$34.70 and said the price could go as high as US$48 in mid-2024 or mid-2025.

"Silver will move higher in 2024 because the top in Yields is confirmed," Investing Haven wrote. "The U.S. Dollar did already confirm its inability to move much higher. Both are supportive developments for precious metals."

Silver is the most conductive element in nature, making it a natural to coat electrical contacts in computers, phones, cars, and appliances. It's also an important element in solar and fuel cell technology.

The World Silver Survey 2023, published by the Silver Institute, said there was a 237.7 Moz deficit between supply and demand for the precious metal in 2022. The institute said this deficit is likely to be repeated in 2023.

Newmont Strategic Equity Position, Future Catalysts

Newcrest Mining Ltd., which was aquired by Newmont Corp. (NEM:NYSE) in November 2023) invested CA$6.34 million in Metallic to advance its copper-silver-gold-platinum group-elements project in Colorado.

"Newcrest was one of the first to recognize the potential (of La Plata) following the announcement of our discovery drill results in early 2023," Metallic Minerals Chief Executive Officer Greg Johnson said.

The company announced an expanded NI 43-101 resource in July 2023 for La Plata of 1.2 billion pounds copper (Cu) and 17.6 Moz silver (Ag) at an average grade of 0.41% Cu Eq, 0.37% Cu, and 3.72 g/t Ag, using a 0.25% Cu Eq cutoff grade.

Those results, combined with results from Keno and a royalty agreement signed with Parker Schnabel of the Discovery Channel's "Gold Rush" on other claims in the Yukon, led Couloir Capital to rate the stock a Buy last year. In an updated research note on September 27, it set a fair value per share estimate of CA$0.74. The stock was CA$0.33 per share on Thursday morning.

Important catalysts to look for with the company now include an inaugural resource estimate for Keno Silver, further drill results for La Plata, an expanded La Plata resource, and exploration plans for the coming 2024 field season.

Ownership and Share Structure

About 17% of Metallic Minerals is owned by management and insiders, including CEO Johnson with 4.23 % or 7.05 million shares, Independent Director Gregor Hamilton with 0.82% or 1.37 million shares, and the president, Petsel, with 0.51% or 850,000 shares.

About 34% is owned by strategic investors, including Newcrest's 9.5% and mining financier Eric Sprott, who owns 14.5%.

About 22% is owned institutionally. The rest, 27%, is retail.

Its market cap is CA$55 million, with 166.72 million shares outstanding, 119.94 million of them free-floating. It trades in a 52-week range of CA$0.44 and CA$0.195.

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1. Metallic Minerals Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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