BMO: Market Perform rating for Probe Mines LimitedAccording to BMO Capital Markets:
Probe Mines
(PRB-TSXV)
Stock Rating: Market Perform(S)
Target Price: na
May 6, 2014
Summer Drill Program Announced
PRB announced plans for a 40km infill drill program beginning mid-May on the Borden Project near Chapleau, Ontario. The focus of the program will be to better delineate the High Grade Zone (HGZ). Interpretation of results from the recent winter drill program suggests that the HGZ has flattened, and is at a higher elevation than previously considered. As a result of this new interpretation, PRB management believes that most of the wide space extension drilling completed during the winter program drilled below the core of the HGZ. The company plans to release a NI43-101 compliant resource for Borden by the end of Q2 that will serve as the basis for a Preliminary Economic Assessment expected later this year. PRB is also planning to advance 5km of regional exploration drilling for its East Limb project targeting anomalies along the extension of the Borden Belt. The company currently has ~$29.4M in cash.
Our View:
- Based on the sections included with the release, in BMO Research’s view it is reasonable that the recent program undercut the main zone of the system.
- Due to the orientation of mineralization, it will be difficult to transect portions of the zone from shore; therefore, the company may not be able to definitively outline the HGZ until the winter drill campaign (post freeze-up).