The Gold Advisor July 5, 2023: Snowline Gold (SNWGF; T.SGD) hits 418.3 meters of 1.9 g/t gold in first hole at Valley.
The 2023 drilling season kicks off with a bang, with Snowline’s first drill hole at the Valley project returning yet another banzai assay.
The headline hole measures a whopping 794.7 gram-meters (multiply the two).
Within that hole they hit two higher-grade zones: 3.08 g/t gold over 216 meters (665.2 gram-meters) and 4.12 g/t gold over 121.4 meters (500.1 gram-meters).
This hole is special, because…
The entire hole is within 400 meters of surface. That means it could be open pittable, at least to start, which is cheaper to mine.
It has strong continuity; no assays came back below 1 g/t gold.
It is the highest sustained gold grades at the Valley target to date (they also hit 6.38 g/t gold over 15.4 meters and 5.23 g/t over 24 meters).
It is the strongest gold grades sustained over >10 meters downhole, expanding the known extent of multiple-gram-per-tonne gold mineralization within the target.
It’s worth pointing out what CEO Scott Berdahl says (emphasis mine), “Our first drill hole of 2023 was drilled to test what we thought was the edge of a relatively high-grade gold corridor within the Rogue Project’s Valley intrusion. It ended up as Snowline’s second-best drill hole to date. The entire 418 metre hole is mineralized. The consistency of gold grades over large distances is remarkable. Internal intervals ranging from 15 to 25 metres in length bear higher gold grades than we have previously seen at Valley. These results highlight the discovery potential still present within and around the broad spatial footprint that we tested with sparse drilling last season.”
The continuity here means it’s cheaper to drill. And likely cheaper to mine… engineers will love designing this textbook deposit. Heck, geology students may someday read about Snowline and what an ideal discovery looks like.
Three drills are currently turning at Valley, with over 5,800 meters and 13 holes completed to date. Lots more assay results ahead.
Let’s talk about the stock, as in my opinion it’s not too soon to start comparing it to some of the bigger gold discoveries in North America. For example, Great Bear discovered 5 million ounces and was bought by Kinross for C$1.4 billion. And yet so far, on an ounce-per-meter basis, Snowline’s results are basically tracking two orders of magnitude greater than Great Bear.
Before it was bought out, Great Bear’s stock was trading below C$3 for over a year—but then there was some sort of sudden realization on the part of investors about the discovery and it jumped into the teens, then jumped again above $20.
To be clear, Snowline is not in the same league yet as similar looking deposits. There is still a lot of work to do—but there is a lot of runway left here, and that’s just at Valley. Snowline’s advantage now is that it will likely take less drilling than some of those other deposits to de-risk it and get Valley and potentially other deposits to a stage where institutional money gets more interested, along with a potential buyout suitor.
Last, surveying the analyst reports shows that as of their May reporting, the average one-year price target for Snowline Gold was C$5.92. They range from a low of C$5.15 to a high of C$6.82. It’s currently below C$4.
The stock is up today, on heavy volume. Don’t chase it, but this is one you want in your portfolio. It’s in mine, as an overweight holding.