Perhaps the secrets of Pilar have been revealed.I have been anxiously waiting for several weeks for the assay results of core drill hole JES-22-59 from Phase III, since this was a core twin of the reverse circulation drill hole JES-20-32 from Phase I which returned 94.6 metres at 1.6 grams per tonne gold. These results caught my attention then, and now the results of JES-22-59 reported on April 14 have caught my attention even more.
Why is this core drill hole so important?
I believe it not only confirms Phase I drilling, but it also provides a level of resolution that can’t be obtained from a reverse circulation drill, effectively providing a more detailed snapshot of the geology underlying the Main Zone. Historical and current drill programs have been trying to understand the geological structure of Pilar for years, and now after over 21,000 metres of drilling, wait not longer, I believe they have truly unlocked the secrets and structure of the Main Zone in Pilar.
I was first alerted to the quality of JES-22-59 when Brodie Sutherland (CEO and geologist) mentioned in the News Release February 15 that a significant length of mineralized breccia host was observed in the drill core when the core was logged. Quote,
“This is significant as it suggests that mineralization is not isolated to narrow veins but in places hosted in a broad breccia body that is much more attractive as a development target”. There wasn’t information provided at this time, but I knew this had to be significant. Sure enough, JES-22-59 returned 116.9 metres at 1.2 g/t Au and seven g/t Ag, including an impressive 48.1 metres at 2.8 g/t Au and 9 g/t Ag.
It is very significant for Pilar to be hosted in a broad breccia body, rather than thin veins that are expensive to mine. A broad breccia body greatly reduces the cost to production and the type of extraction methods used.
Of particular interest to me was the high-grade gold-silver mineralization recorded adjacent to a heavily faulted and altered zone returning 10.2 metres at 12 g/t gold and 23 g/t silver, including 4.2 metres at 28.3 g/t gold and 49 g/t Silver. But what is more important is this fault was located at only about 55 m depth.
Overall, I am impressed with the closeness of Pilar to the surface, as economic grade mineralization starts below only 20 metres of overburden according to small cores, but I think this may be even at the surface as evidenced by recent trenching. Why is this important – the results serve to strengthen the hypothesis that Pilar can be fast tracked to becoming the next open pit heap leached mine in the area.
A total of 1,562 metres of phase III drilling has been completed in nine drill holes providing key information across the Main Zone and 4-T trend.
Results for five drill holes are pending, but of particular importance to me is gong to be the results of 3 holes that will test the extension of the “controlling faults” to the southeast.
I am anxiously waiting for the assays from these 3 drill holes which are located southeast in a gap zone that has seen little drilling. These holes are strategically stepped out 25, 50 and 100 metres to expand the Main Zone and provide additional critical information for the calculation of Pilar’s maiden compliant 43-101 resource calculation. These holes are focused on the main trend between hole JES-20-32 (94.6 m at 1.6 g/t Au) and hole JES-21-50 (39.7 m at 0.96 g/t Au).
Also of particular interest is Brodie’s comments in a recent interview (
https://youtu.be/PehgRlLQR5w) where he commented that he thought historic drilling in this area was directed in the wrong direction. If his assumption is correct, and by directing these holes in the opposite direction between holes JES-20-32 and JES-21-50 drilled last year, results could accelerate the advancement of an open pit mine, which would reduce costs and provide cash flow for further development.
Metallurgical results should also be released in the coming months which will provide critical information as to the capital requirements and economics of future production. I must iterate that we already know these results should (will) be positive. TOC has submitted five large samples collected during recent trenching from Pilar for column leach studies, with the first sample already returned from a large sample submitted to SGS Durango of 321 KG had a head grade of 0.95 g/t Au and 9.5 g/t Ag. This came from the surface in the Main Zone. Because of this excellent head grade, they have submitted a second sample to confirm these results. We also know from other similar working mines in the area, combined with these comparative extraction results, that 0.41 g/t Au alone is economic grade (not including the head grade for Silver).
I believe great progress has been made in the Main Zone, but one must also understand the 4-T trend holds great promise to expand the resource at Pilar (I think one of the next cores or perhaps both come from 4-T).
I also look forward to a webinar that will be scheduled in mid-May to go over the next steps for Pilar, and during which I am hoping they will announce a drill program at Picacho (this property has had intense previous workings). TOC has been undergoing sampling, mapping, and target evaluation of Picacho since mid-November 2021, so I suspect this property has been sufficiently advanced for drilling perhaps this summer.
From a stock investment perspective, I believe TOC has built an excellent company for shareholders by financing at higher prices thus reducing share dilution. There is also plenty of room for future financings without significant share dilution as there is only about 32 M shares outstanding, cash in the bank for drilling, and two excellent assets, Pilar and Picacho.
TOC traded 350,000 shares on Thursday closing above $0.80, one of the highest trading days for months if not perhaps in a year except for one day back in November when the markets took a tumble, but the share price quickly recovered. TOC traded only 695,000 shares last week. These overall very low volumes are indicative of a strong shareholder base. I should comment that most of the selling has been coming from Anonymous, through which appears to be a major shareholder exiting (perhaps they need the cash or some other unrelated reason).
In conclusion, if TOC continues to produce results like the ones released on Thursday, it will surely attract serious shareholders who want to participate in the exciting future of TOCVAN.
One last comment, also to be discussed at the May webinar are the details of the Rogers Creek property transaction, when a detailed update including the record day to be eligible as shareholder will be provided once the deal nears completion. The transaction is going forward and is planned to be executed in Q2/Q3 of 2022, unlocking the value of the Rogers Creek property to all shareholders of Tocvan in a new copper-focused company (see News Release Sept. 30, 2021). It is contemplated that TOC shareholders receive for free 1/6 shares in spinout, or for example, every 60,000 shares a shareholder owns of TOC, they will receive 10,000 shares in the new company.