Dakota Gold Corp. (DC:NYSE American) announced the discovery of a new high-grade gold formation at its Maitland Gold project in the historic Homestake District of South Dakota.
The JB Gold Zone was found drilling hole MA23C-017, which intersected 12.51 grams per tonne gold (g/t Au) over 4.7 meters in the same mineralization style as the Homestake Mine, which produced more than 40 million ounces (Moz) Au over its lifetime.
"We believe the new JB Gold Zone could be Dakota's most significant discovery to date, with hole MA23C-017 returning the most substantial intercept ever encountered north of the city of Lead," Canaccord Genuity analyst Michael Fairbairn wrote in a flash update Thursday.
The hole is a 408-meter step-out to the northwest from a previous Homestake intercept in drill hole MA22C-003 of 10.03 g/t Au over 3.2 meters. The intersection in MA23C-017 occurs in a wider zone grading 7 g/t Au over 9.5 meters, the company noted.
"It is possible the Homestake mineralization encountered in hole MA23C-017 connects to (those) found in MA22C-003, … providing 408 meters of potential strike between the intercepts, a possibility which will be tested with future drilling," Fairbairn wrote.
We believe the new JB Gold Zone could be Dakota's most significant discovery to date, with hole MA23C-017 returning the most substantial intercept ever encountered north of the city of Lead," Canaccord Genuity analyst Michael Fairbairn wrote
The hole with the new discovery was sunk 5.5 kilometers from the Homestake Mine Open Cut, and 2.9 kilometers from Homestake Mining Company's North Drift Discovery, Dakota Gold said. The alteration and mineralization present in MA23C-017 is the same as the high-grade mineral zones found at the Homestake Mine.
"With two potentially economic mineralized intersections in drill holes MA22C-003 and MA23C-017, we can now begin to vector our drilling into wider zones of gold mineralization," said Dakota Gold's Vice President of Exploration, James M. Berry.
Robert Quartermain and Jonathan Awde head Dakota Gold, which has acquired and is exploring 46,000 acres surrounding the historic mine.
Industry giant Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) also backs the company.
The Catalyst: Revitalizing a Legendary District
Dakota Gold continues to have four drills operating on its Homestake properties, two at its Richmond Hill project and two at Maitland Gold.
Last month, the company announced it had outlined an extensive gold system more than a mile long from north to south, with mineralization open in all directions, at the Richmond Hill project, which is 2.3 miles west of Maitland.
Drill hole RH22C-013 at Richmond Hill assayed 5.98 g/t Au over 30 meters at the intersection of a dominant north-south structure, confirming the existence of higher-grade gold mineralization.
Others in the field agree with the strategy. "The best place to find a new gold mine is in the shadow of the head frame of an existing gold mine," geologist and investment analyst Matt Badiali has told Streetwise Reports.
"At Richmond Hill, DC is working on upgrading the historic oxide resource . . . and conduct additional exploration/step-out drilling," Fairbairn wrote. "Results to date bode well for the next resource update, with indications that Richmond Hill hosts a substantial high-grade gold orebody."
"Dakota Gold is now seeking to revitalize this legendary district in hopes of making a material discovery on its land package proximal to the mine," Fairbairn noted.
Others in the field agree with the strategy. "The best place to find a new gold mine is in the shadow of the head frame of an existing gold mine," geologist and investment analyst Matt Badiali has told Streetwise Reports.
CEO: Project Extremely Encouraging
At Maitland, the company is in the early stages of drilling to define the geology, find preferential terrains for gold mineralization, and produce discoveries.
"The next phases of work are geared toward definition of the mineralized zones with drilling on tighter spacing and vectoring toward centroid mineralization," Dakota Gold said in a release.
Homestake's North Drift Discovery led to a US$70 million exploration program between 1988 and 1994, which has served as the foundation of Dakota Gold's land acquisition and exploration programs.
The North Drift program intersected 11.43 g/t Au over 4.6 meters, 4.77 g/t Au over 7.6 meters, and 7.61 g/t Au over 7.3 meters, all of which are on the Company's property. These intercepts have not been verified by Dakota Gold.
President and Chief Executive Officer Jonathan Awde has said he was "extremely encouraged" by Maitland.
"We believe we are on the cusp of vectoring toward higher grades and on making a discovery with Maitland," he said.
Streetwise Ownership Overview*Much of the land owned by Dakota Gold has not been explored in nearly 30 years.
Ownership and Share Structure
According to the company, approximately 30% of the company's shares are with management and insiders. Out of management, Co-Chairman Robert Quartermain holds the most shares at 10% or 7.34 million shares. President and CEO Jonathan Awde is next at 8.4% or 6.2 million shares, while COO Jerry Aberle holds 6% or 4.2 million shares. The remainder of the 30% is held by other members of management and the board of directors.
According to Reuters, about 26.6% of the shares are with institutional investors, including Van Eck Associates with 3.8%, BlackRock Fund Advisors with 3.6%, CI Investments with 3.6%, Fidelity Management with 3.5%, The Vanguard Group with 3.2%, Barrick Gold Corporation with 3%, Medalist Capital with 2.4%, Delbrook Capital with 2%, and Sprott Asset Management with 2%.
About 27.4% is with strategic investors, Reuters said. The largest holding is with Marin Katusa + KCR LLC, which owns 4.9%.
Dakota Gold has a market cap of US$259.76 million, with 75.3 million shares outstanding and 56 million free-floating. It trades in a 52-week range of US$4.69 and US$2.61.
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