Mining Co. Uncovers High-Grade Gold at Alaska's Lucky Shot

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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Contango Silver and Gold (CTGO:TSX; CTGO:NYSE) announced the successful completion of the initial phase of its 2025/2026 underground diamond drilling program at the Lucky Shot Project in Alaska, as reported in a May 5 release.

This initial phase is part of a broader 18,000-meter underground and surface exploration campaign aimed at expanding resources, enhancing the geological model's accuracy, and advancing technical studies. These efforts are in preparation for a mineral resource update and a feasibility study planned for the first half of 2027, the company said.

Additionally, Contango has successfully acquired the underlying Lucky Shot lease and net smelter returns royalty, further solidifying its investment in the project.

"Our latest drilling at Lucky Shot has exceeded expectations, providing a better understanding of the system’s continuity and productivity," Chief Executive Officer Rick Van Nieuwenhuyse said. "The presence of visible gold in multiple intervals is a powerful indicator of the high-grade nature of this deposit. By confirming these multiple vein structures, we have significantly expanded the underground footprint while continuing to de-risk the project."

He continued, "This is not just additional drill and assay data; it is a roadmap to expansion. These assays provide the critical momentum we need to accelerate our technical work and unlock the substantial scale we see inherent in this project."

Select Highlights Include:

• LSU26057: 0.37 meters averaging 10.53 grams per tonne gold (g/t Au) (L1c Vein)
• LSU26060: 1.34 meters averaging 8.58 g/t Au (L1c Vein)
• LSU26062: 2.18 meters averaging 7.98 g/t Au (L1c Vein)
• LSU26063: 1.15 meters averaging 16.47 g/t Au (L2 Vein)
• LSU26064: 2.89 meters averaging 16.06 g/t Au, including 0.5 meters averaging 74.2 g/t Au (CK Vein)
• LSU26066: 0.31 meters averaging 31.56 g/tAu (L1c Vein)
• LSU26067: 0.35 meters averaging 13.61 g/t Au (L1d Vein)
• LSU26068: 0.30 meters averaging 55.45 g/t Au (L1c Vein)
• LSU26072: 0.84 meters averaging 10.28 g/t Au (L1d Vein)
• LSU26076: 2.71 meters averaging 4.28 g/t Au, including 0.36 meters averaging 24.29 g/t Au (L2 Vein)
• LSU26077: 0.33 meters averaging 9.37 g/t Au (CK Vein)

Acquisition of Project

On May 4, Contango entered into a purchase and sale agreement with Alaska Hardrock Inc. to acquire 100% ownership of the Lucky Shot project. This acquisition, totaling US$16,074,000, includes the underlying real property, mining claims, and mining equipment, and extinguishes the outstanding 2% net smelter returns royalty held by Alaska Hardrock Inc.

The financial structure of the deal includes a cash deposit, a substantial cash payment upon signing, a further cash payment expected by the closing date of July 1 and a promissory note secured by the acquired assets.

Van Nieuwenhuyse highlighted the strategic importance of this acquisition, noting, "Contango has successfully consolidated the royalty interests at Lucky Shot, a move that significantly enhances the project's overall value. It is a rare and exciting milestone for an operator to acquire the surface and subsurface royalty interests, effectively streamlining our cost structure. This investment allows us to move into the feasibility stage with a highly efficient operating profile, keeping the project’s full potential firmly in the hands of our investors."

Contango said the drilling program, which started in November 2025, has achieved 6,020 meters of drilling across 65 HQ diamond drill holes from ten underground stations. This effort has not only confirmed but also extended the mineralization within the Lucky Shot vein system, particularly the L2, L1b, L1c, and L1d veins. Additionally, the program has identified and confirmed previously unmodeled mineralized structures now known as the L1e and CK veins.

Future drilling at the project, estimated at approximately 12,000 meters, will focus on refining structural orientations, continuity, and grade distribution across these emerging targets, the company said.

Peak Gold JV Distribution

The company recently announced a significant financial boost with a cash distribution of US$9 million from the Peak Gold joint venture, as reported on April 22. The Peak Gold JV has successfully completed the first of its four planned campaigns for the year, with the next campaign scheduled to commence in mid-May.

Looking forward, Contango has outlined a comprehensive operational roadmap for 2026, which includes advancing its portfolio of advanced exploration-stage projects. The company's exploration program for the year is robust, featuring several key initiatives. In addition to the work at Lucky Shot, the company plans to undertake essential infrastructure construction and permitting at the Johnson Tract critical metals project and complete an updated mineral resource estimate (MRE) at the Kitsault Valley project (acquired from its recent merger with Dolly Varden Silver Corp.). Following the MRE, an extensive drilling program is planned to prepare for a preliminary development plan, also anticipated in the first half of 2027.

"The US$9 million cash distribution from the Peak Gold JV underscores the unique strength of our business model — using cash flow from our producing mine operations to fund the aggressive advancement of our 100%-owned assets," Van Nieuwenhuyse noted at the time. "We are hitting the ground running in 2026 with the strongest balance sheet and the most aggressive operational schedule in our company's history."

Van Nieuwenhuyse continued, "With nearly 60,000 meters of drilling and important infrastructure work planned in 2026, we are rapidly advancing and derisking our Tier 1 assets toward production. This is a year of execution, and we are fully funded to deliver on the milestones that will define our next chapter as a leading silver and gold developer in Alaska and British Columbia."

Merger Leads to Higher Valuation

On March 19, Richard Gray, CFA, an analyst at ATB Cormark Capital Markets, reaffirmed his Outperform rating on Contango Ore Inc. (which was also listed as CTGO on the NYSE). He raised his price target for the company from US$46 to US$50 following the shareholder approval of Contango's merger with Dolly Varden. This revised target implies a potential total return of approximately 155% from the current share price.

The merger between Contango and Dolly Varden received robust support from the shareholders of both companies. During a special meeting held on March 17, Contango's shareholders approved all necessary proposals to finalize the merger. These approvals included the issuance of new Contango shares to Dolly Varden shareholders at a predetermined exchange ratio, a significant increase in the authorized share count, and the adoption of a new 2026 Omnibus Incentive Plan. On the Dolly Varden side, an overwhelming 98.78% of votes cast were in favor of the arrangement. A court hearing for final approval of the merger was scheduled for March 23, with the closure of the merger anticipated shortly thereafter.

According to Gray, the terms of the merger dictate that existing shareholders of both companies will each own about 50% of the new entity on a fully diluted basis. The merged company will begin with approximately US$112 million in cash and US$34 million in debt.

The leadership team will include executives from both organizations, with Van Nieuwenhuyse from Contango serving as CEO and Shawn Khunkhun from Dolly Varden as president.

Gray's updated pro forma net asset value (NAV) for the combined entity is US$50 per share. This valuation reflects contributions from several key assets and recent financial activities, including the valuation of the Manh Choh, Johnson Tract, Lucky Shot, and Kitsault Valley projects, along with cash acquired from Dolly Varden and recent equity financing. Despite a decline in per-share NAV from the previous estimate of US$66, Gray raised his target multiple to 1.00x NAV from 0.70x. He cited the addition of silver optionality through Kitsault Valley, an anticipated Canadian stock listing, and a reduced hedge position as reasons for the adjustment.

The Catalyst: Precious Metals Enjoy a Rebound

On Tuesday, precious metals experienced a notable rebound, driven by a significant drop in crude oil prices and a weakening of the US dollar, which spurred renewed interest in safe-haven assets, A. Ksheerasagar wrote for Mint on May 5. Additionally, the ongoing ceasefire between the U.S. and Iran, despite being tested, contributed positively to market sentiment. COMEX gold futures surged by US$64 to reach an intraday high of US$4,697, bouncing back from a more than one-month low recorded on Monday. Similarly, silver prices climbed by US$1.12 to US$74.64 per ounce, recovering from a nearly 2% fall in the previous session.

The region's stability was questioned following recent U.S.-Iran clashes in the Gulf, with both nations vying for control over the strategically crucial Strait of Hormuz, which has been effectively closed since the onset of the conflict, according to the article. Despite these tensions, U.S. Defense Secretary Pete Hegseth confirmed that the ceasefire, initiated just under a month ago, is still in effect. He further reassured markets by reporting that two U.S. commercial vessels safely passed through the Strait of Hormuz with military support.

Meanwhile, the US dollar saw a decline after two consecutive sessions of gains, as tensions between the US and Iran appeared to ease slightly. On the monetary policy front, expectations are set for the US Federal Reserve to maintain interest rates for the remainder of the year, with the market estimating about a 50% chance of a quarter-point rate hike in early 2027. Following a Federal Reserve meeting last week, which resulted in an unchanged rate decision in the most divided vote since 1992, many global brokerage firms now anticipate no rate cuts from the Fed this year, amidst concerns about rising energy prices impacting the economy.

Gold, often seen as a hedge against inflation, tends to lose appeal when interest rates rise, as it is a non-yielding asset. However, the current economic and geopolitical uncertainties continue to drive interest in precious metals as a safe investment choice, Ksheerasagar wrote.

In a recent analysis posted on Goldfix on April 28, Goldman Sachs analysts Lina Thomas and Daan Struyven reiterated their bullish outlook for gold, projecting that its price will ascend to US$5,400 per troy ounce by the end of 2026. This forecast hinges on several key factors: continued diversification efforts by central banks, a return to normalcy in currently subdued speculative positions, and rate cuts by the Federal Reserve totaling 50 basis points, as predicted by their economists.

Despite a notable dip in central bank gold acquisitions in February 2026, where only 2 tonnes were purchased amid significant price fluctuations, Goldman Sachs anticipates an average monthly procurement of 60 tonnes for the remainder of the year. This projection is supported by feedback from a recent Goldman Sachs central bank conference, where about 70% of attendees projected an increase in global gold reserves, while roughly 25% foresaw stability.

Ownership and Share Structure¹

About 10% of Contango is held by insiders, about 45% by institutions, and the rest, 45%, is retail.

Top shareholders include Franklin Advisers Inc. with 2.47%, John P. Juneau with 2.30%, The Vanguard Group Inc. with 2.17%, Kenneth R. Peak Marital Trust with 2.17%, and BlackRock Institutional Trust Co. with 2.03%.

Its market cap is US$732.93 million with 32.34 million shares outstanding. It trades in a 52-week range of US$12.65 and US$34.38.