January 18, 2023: Snowline Gold (SNWGF; C.SGD) hits 1.2 g/t gold over 189.2 meters at Valley.
That intersection measures 227 gram-meters, very nice (anything above 100 is very strong). Another hole hit 1.01 g/t gold over 250 meters, a total of 252.5 gram-meters, again very strong.
Just as important is that these results extend the strike length at Valley to southeast and add significant tonnage to the known mineralization. In other words, there’s lots of room to grow.
(BTW, if you didn’t see it, I’ve been to Snowline’s projects, including Valley. You can read the full report with lots of photos in our free write-up here.)
I like how CEO Scott Berdahl summarizes what this means (emphasis mine). “Each round of Valley drill results has increased not just to the known extent of mineralization at the target, but to our understanding of its geology and the geometry of its highest-grade zones. The most robust and consistent mineralization we have seen so far at Valley begins in a broad zone at surface, lending itself to promising potential economics for the project, and reducing the drill metres required to advance the discovery.”
Management also says they’re starting metallurgical testing, something I was glad to read. Met testing basically tells you how much of the gold can be recovered from the ore. I’d like to see 90% recovery rates, or higher. Either way, initial met results will tell management about the economics here.
Why is the stock struggling on this news? The gold price is weak as I write, but more than that I think it’s because investors have seen results like these from Snowline before, and better. That said, almost any company would love to have results like these.
There are still 13 holes pending for assay, a total of 6,003 meters, at both Valley and Gracie, so more news is ahead. Hole 29 at Valley and the results at Gracie could be interesting.
Big picture, this is a company sitting on a huge land package that is proving, right out of the gate, not just how prospective it is but how big it might be. You just don’t see projects like this very often.
In fact, Mining Explained estimates there could be 5.8 million ounces here. That’s NOT official, just a professional guess, but it gives you an idea of just how big this could be. This is why Snowline is a stock I plan to hold for a long time.
I had mentioned earlier that if one wanted to buy or add to a position to look for prices below US$2. We’re there now. I’m not saying this is “the bottom,” but relative to the enormous potential here the stock is at a very attractive price.