Liberty Gold Corp. (LGD:TSX; LGDTF:OTCQB) announced that 13 holes drilled in the M zone at its Black Pine project returned shallow, high-grade gold mineralization, which has positive implications for a future resource and, ultimately, mine plan, reported Haywood Securities analyst Dr. Geordie Mark in a November 8, 2022 research note.
"We see the M Zone resources easily growing, as well as many of the other areas on Black Pine (e.g.,) Rangefront), which highlights the growing mass of exploitable gold that is required to elevate the potential scale of a future open-pit, heap-leach operation," Mark wrote.
Key Points About the Stock
Mark reiterated Haywood's Buy rating and target price of CA$2 per share on Liberty. The latter represents a projected return of 471%, as the Canadian mining explorer's current share price is about CA$0.38.
"Liberty Gold shares continue to trade at an attractive valuation," Mark wrote.
Upcoming events that could increase Liberty's share price, Mark indicated, are an ongoing stream, over the next two quarters, of drill results from its 65,000-meter (65,000m) program at Black Pine in Idaho, still in progress.
Subsequent catalysts are a Black Pine resource update and preliminary economic assessment.
"Liberty Gold shares continue to trade at an attractive valuation, particularly given the incremental derisking being demonstrated through ongoing drilling on Black Pine that will inform [the] resource update in 2023," Mark wrote, "which will likely expand given how open the systems are currently."
Interpretation of the Drill Results
This newly reported batch of Black Pine drill results for 13 holes in the M zone has several implications, Mark noted. One is the mineralized system remains open both along strike for 750m-plus and to the northwest.
The second is there likely is lateral continuity of gold mineralization between the pit-defined resources.
The third is this intra-pit mineralization sits at depths equal to or less than those of the pit-constrained resources. This suggests, Mark wrote, resources could be grown by combining them into one pit, a move that would increase the resource's total mass and boost the average grade at a lower waste-to-ore strip ratio.
Three newly reported holes demonstrate the shallow depths and grades well above the average grade of the 2021 M zone global resource of about 0.62 grams per ton (0.62 g/t) gold.
- LBP688: 36.6m of 1.53 g/t gold from 79.2m
- LBP715: 57.9m of 1.4 g/t gold from 76.2m
- LBP717: 15.2m of 2.46 g/t gold from 89.9m
More drilling in the M zone is needed, Mark pointed out, to fully determine "the spatial distribution, grade and metallurgical characteristics" of the "predominantly oxidized and strata-bound gold mineralization" there. Three drill rigs remain active in this zone and also in the Rangefront and Section 36 areas.
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Disclosures For Haywood Captial Markets, Liberty Gold Corp., November 8, 2022
Analyst Certification: I, Geordie Mark, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.
Important Disclosures:
Of the companies included in the report the following Important Disclosures apply:
Haywood Securities, Inc. has reviewed lead projects of this company and a portion of the expenses for this travel may have been reimbursed by the issuer.
Haywood Securities Inc. or one of its subsidiaries has managed or co-managed or participated as selling group in a public offering of securities for this company in the past 12 months.
