Dakota Gold Corp. (DC:NYSE American) announced results of 13 infill and stepout holes, which were positive, drilled as part of the 2024 program at its Richmond Hill project in South Dakota, reported BMO Capital Markets analyst Andrew Mikitchook in a Nov. 26 research note.
176% Return Implied
On the news, BMO maintained its $6 per share price target on the South Dakota-based gold explorer, currently trading at about $2.17 per share, the analyst noted. The difference between these prices implies a potential return for investors of 176%.
Dakota still is rated Outperform.
Likely Resource Expansion
Dakota's recent drilling took place in Chism Gulch, an area at Richmond Hill with minimal previous drilling, in the northeast corner of the resource envelope, reported Mikitchook. The company targeted both existing gaps in the current block model and incremental stepouts.
Generally, results showed grades and widths similar to those in the block model and higher than expected. Two standout intercepts were 10.2 meters (10.2m) of 4.14 grams per ton (4.14 g/t) gold and 13.4m of 1.99 g/t gold.
"RH24C-115 returned 1.84 g/t over 10.5m, which we expect should extend [the] resource past [the] current boundary," Mikitchook wrote.
Further, the deposit remains open in all directions.
Role in Advancing Maitland
Richmond Hill "could represent a near-term modest gold production opportunity that could generate cash flow to fund advancing the JB gold zone discovery" at Dakota's Maitland gold project, Mikitchook reiterated. At Maitland, the company finished its 2024 drill program targeting the JB zone and the Unionville zone.
After analyzing the 2024 drill results at Maitland, Dakota may choose to follow-up drill there next year.
What to Watch For
Mikitchook indicated what the near-term plans are for Richmond Hill. A steady flow of drill results from the 2024 program at this project, on track for completion at the end of last month, is to come.
An updated resource estimate, encompassing data for 145 new drill holes, is to follow. Next to be done, likely in Q2/25, is an SK1300 initial assessment including cash flow, equivalent to a preliminary economic assessment.
"Management views Richmond Hill as a low-cost, surface oxide, heap-leach operation similar to the adjacent Wharf mine," Mikitchook wrote.
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