Co. Continues High-Grade Gold Streak Near Historic South Dakota Mine

Source: Streetwise Reports 04/08/2024

Dakota Gold Corp. DC announces it has found three distinct ledges of high-grade Homestake Mine-style gold mineralization at its Maitland Gold Project in the Black Hills of South Dakota. Find out why one newsletter writer calls the company the "real deal."

Dakota Gold Corp.'s  stock went up more than 7% on Thursday with its announcement that it has now found three distinct ledges of high-grade Homestake Mine-style gold mineralization at its Maitland Gold Project in the Black Hills of South Dakota.

The historic Homestake Mine, about 3 miles south of Maitland, produced 41 million ounces gold (Moz Au) and 9 Moz silver (Ag) over 126 years.

Dakota noted in a release that it had named the ledges 34 Ledge, 34 Ledge, and 36 Ledge and released assay results from two holes at the project.

The company's stock went up US$0.16 to US$2.45 per share on the news.

"Dakota continues to extend and better understand the high-grade mineralization at Maitland" wrote Canaccord Genuity analyst Peter Bell in an updated research note on Thursday. "These strong intercepts, especially (hole) MA24C-038 with 25.03 g/ t (grams per tonne gold) over 4.4 meters, highlight the prospectivity for a substantial Homestake-style deposit. The continued advancement of Homestake-style targets adds excitement and optionality to the Richmond Hill deposit located to the west."

The other hole released, MA24C-036, returned 9.36 g/t Au over 2.6 meters. Both it and MA24C-38 are in 36 Ledge on the west side of the mineralized gold trend. The company said the mineralization intersections were shallow, about 500 meters down.

"Based on my experience working in the Homestake Mine, at Maitland, we have intersected higher grade mineralization that is shallower than exploration results from the upper portion of the West Ledge system at Homestake, which ultimately produced more than 6 million ounces of gol," said Vice President Exploration James Berry. "In the West Ledge, the best grades were encountered at depths that Dakota Gold's exploration programs have yet to drill test. We, therefore, fully expect to find even better grades and additional ledges as drilling continues."

John Newell of Golden Sky Minerals called the company a "revitalized entity, spearheaded by mining entrepreneurs" predicting targets of US$3.60, US$4.05, and US$6.25 for its shares despite a decline over the past two years (chart at left).

"The company's mission leverages this historical backdrop, aiming to uncover significant gold deposits by applying modern exploration techniques and knowledge to this historically gold-rich area," Newell wrote.

The Catalyst: 'High-Grade Exploration Sizzle'

Dakota said drilling at Maitland is transitioning from wider horizontal spacing of about 250 meters to tighter spacing to delineate the ledges now outlined, which remain open along strike and to depth.

The company has 46,000 acres of holdings surrounding the original Homestake Mine, first discovered in 1876 and consolidated by George Hearst, over the past decade. The area was once called the "Richest 100 Square Miles" on Earth.

Dakota currently has four drills at its properties in the district, including Maitland and Richmond Hill 2.3 miles to the west.

After touring the area in 2021, Chris Temple, editor of The National Investor, recently added Dakota Gold to his list of recommended stocks.

"During that trip — and as a multi-faceted exploration game plan has come together since — I have grown to be increasingly of the view that this is the real deal" Temple said about Dakota. "Indeed —as you'll be hearing more of from me in the near future — the exploration potential has been revealed as more substantial than first thought.

The combination of Maitland and Richmond Hill "gives investors exposure to an advancing development project, with high-grade exploration sizzle, in our view," Canaccord Genuity analyst Peter Bell wrote.

Technical Analyst Clive Maund said the bear market the company's investors have known is "changing fast."

"There are two big reasons to believe that Dakota is done falling and is now in position to take off higher" Maund wrote on April 4. "One is that the entire sector is embarking on a major new bull market, and the other is the very positive news out of Dakota just this morning that it has intersected 25 grams per ton gold at Maitland."

Analysts Michael Gray and Jake Savage of Agentis Capital called Thursday's news "very positive."

"The Homestake Formation is interpreted to be very thick in the mineralized ledge area — this is a positive indicator" the analysts wrote in an April 4 research note. "DC is developing a growing understanding of the structural picture and the plunge direction of the syncline folds known to host mineralization."

Potential 2 Miles of Tertiary Epithermal Mineralization

Dakota has consistently been releasing new high-grade drill results from the projects this year. Released in January, drill hole MA23C-026, also at Maitland, intersected 167 g/t Au over 1 meter, which was Dakota's highest intercept to date.

The Homestake Formation gold mineralization contains "visible free gold associated with lower sulfide quartz-carbonate veins" the company noted in a release.

Last month, it reported assays from 11 holes that showed continuity in the Tertiary epithermal gold mineralization in Maitland's Unionville Zone. Highlights included step-out drill hole MA23C-023, which returned 6.24 g/t Au over 2.6 meters, indicating a significant extension of the Tertiary gold mineralization at Maitland.

Dakota noted that drill results to date have only partially tested 1,200 meters of the potential 2 miles of the Tertiary epithermal mineralization there.

Dakota also has found important rare earth elements (REEs) vital to the new clean energy economy at the project. China is responsible for two-thirds of current REE mine production and more than 85% of the refined output of REEs, and developing a new mine can take years.

The company expects to release a maiden resource for Richmond Hill soon.

Ownership and Share Structure

According to the company, approximately 25% of its shares are with management and insiders.

Out of management, Co-Chairman Robert Quartermain holds the most shares at 8.49% or 7.45 million shares, President and CEO Jonathan Awde is next at 6.86%, with 6.01 million shares, while COO Jerry Aberle holds 4.88%, with 4.28 million. The remainder of the 25% is held by other members of management and the board of directors.

About 26% of the shares are with institutional investors, according to Yahoo Finance and Edgar filings. Top institutional holders include Fourth Sail Capital with 5.27%, Van Eck Associates with 3.97%, Blackrock Institutional Trust Co. with 3.65%, The Vanguard Group Inc. with about 3.15%, Fidelity Management and Research Co. LLC with 2.71%, and CI Investments Inc. with 2.63%.

About 16.5% is with strategic investors, including Orion Mine Finance, which owns about 7.7%, and industry giant Barrick Gold Corp., which owns about 3%. The rest is retail.

Dakota Gold has a market cap of US$227.41 million, with 87.7 million shares outstanding. It trades in a 52-week range of US$3.95 and US$1.95.

Important Disclosures:

1. Dakota Gold Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Dakota Gold Corp.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
4. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.