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SPA: First Assays from Fall Program Already Impress

What you need to know:
• This morning, SPA announced assay results for its first two drill holes as part of its 9,000-10,000m fall drill program.
• The results confirm strong grades over wide intervals within the proposed pit (in areas previously modeled as lower-grade and/or waste), including 0.77 g/t Au over 112m and 0.64 g/t over 102m.
• Drilling supports advancement toward a 2027 construction decision, building on a PEA with $1.03B NPV5% and 18% IRR at US$2,450/oz.
• We recently initiated coverage on Spanish Mountain; read it here.

This morning, Spanish Mountain Gold (SPA:TSXV, SPAUF:OTCQB) announced the first set of assay results from two holes as part of its 9,000-10,000m fall drill program at its Spanish Mountain Gold Project in the Cariboo Gold Corridor, BC. The first two holes intersected strong grades over wide intercepts, including 0.77 g/t Au over 112m and 0.64 g/t Au over 102m. This first set of results already starts to validate the continuity of mineralization near surface as well as supports the Company’s thesis that closer spaced infill drilling will add higher grade gold mineralization (in early years of the mine life) and add ounces to the already sizeable deposit. Today’s results were in the newly defined Orca Fault area, where there is strong potential that grades in this area will far exceed mineral resource grades. Assays are pending on seven additional drill holes completed in the Orca Fault Area. We are maintaining our BUY rating and our $0.40/share target price on Spanish Mountain Gold.

Highlights from today’s release include:

• 25-DH-1292: 0.77 g/t Au over 112m (from 84m), including 1.18 g/t over 36m, including 1.80 g/t over 10m.
• 25-DH-1293: 0.64 g/t Au over 102m (from 94m), including 0.77 g/t over 60m, and 1.28 g/t over 20m, including 2.15 g/t over 2.4m.

This first set of drill results from the ongoing fall drill program was in a newly interpreted target area called the Orca Fault area (Figure 1). This area is interpreted as a zone where structural features, such as the Orca Fault have resulted in higher-grade gold mineralization.