I am always curious about how a junior exploration company comes to take an interest in a particular property. Graham Harris, CEO of Black Mountain Gold (BMG.V) was happy to tell me.
“The group at Millennial Lithium saw that there was likely to be an uptick in the inflation rate due to the massive liquidity injection by the Federal Reserve. This meant that we wanted to have some exposure to gold,” said Harris. “We’re company builders. We like to find a property with potential and develop it over time into a world-class asset.”
Harris and the group began looking at gold projects and letting people they worked with know that they were in the market for a gold asset. M3 Metals, another junior company, had a gold project in the mining-friendly jurisdiction of Arizona. Black Mountain acquired 90% option on the Arizona project and then did a successful private placement to raise money to explore the property.
The Mohave project covers over five square miles. It was originally in private ownership with the owners having spent roughly 12 milion dollars on drilling, sampling and constructing a leach pad and a 350 tonne per hour crushing facility. The private group ran out of funding in the 1990’s and the property and equipment have sat idle since.
From M3 Metals website, “550 drill holes totalling more than 68,000 feet drilled on the project, and this drilling has developed a historic Reserve of 56,000 oz/Au and a historic Resource of 40,000 oz Au for a total of 96,000 ounces of gold. All of the historic drilling has been done in the northern one-fourth of the property, and the majority of these holes were shallow 100 feet-deep, air-track holes, and many stopped in ore-grade mineralization.”
“The original plan was to mine the oxidated rock, crush it and put it on the pad,” said Harris. “But the private group ran out of money and out of steam. They were looking at the property as a 20,000 ounce per year private venture.”
This was not at all a bad idea for private owners, but the price of gold in the 1990s limped along under $400 an ounce and the private venture, having put a lot of money into the property, went dormant.
The Mohave project was never deeply drilled and virtually all of the drilling was at the northern end of the property. This gives Black Mountain valuable information but it also leaves the property open to a new geological interpretation and modern exploration techniques. A lot has changed since the ‘90s.
“We’re seeing excellent surface expressions, there is gold everywhere,” said Harris. June 9, 2021 the company released the assay results from its recent mechanical rock chip-channel sampling program. Commenting in that release, Harris said, “Particularly encouraging are the high-grade gold values such as 53.8 g/t Au over 2.8m suggesting potential for higher-grade feeder zones to the epithermal system. Equally encouraging are some of the wider intersections such as channel C36 at the Scout Prospect where sampling over 24.75m yielded 0.71 g/t Au which suggests the potential for an open pit mining scenario.”
Black Mountain wants to drill the property to test its theory that the deposit is “stacked”. Basically, the Black Mountain geologists understand the surface expressions and the oxide material as the top of a larger gold-bearing structure. By drilling deeper than the 100 feet the earlier owners drilled Black Mountain hopes to prove up a significantly larger deposit.
How much larger? There are gold bearing outcrops all over the Mohave property. Soil sampling shows significant gold in soils across the property. There are ten historic small scale mine sites on the property and the property is believed to have produced 100,000 tons at a grade of between 0.33 and 0.5 oz Au/ton. These were all surface workings. The Black Mountain hypothesis is that those surface indications all suggest that this is an epithermal gold system and that drilling deeper could reveal the feeder zones to that system.
“The Millennial team develops world-class assets,” said Harris. “At Mohave, we see a potential for a million to two million ounce gold deposit.”
Drilling requires permits and Black Mountain has applied and expects to have the permits in three to six months. “But with COVID, well we really can’t control that process.”
Meanwhile, Black Mountain is pushing forward with channel sampling on areas in both the southern and northern parts of the property. The results of this sampling will be combined with earlier sampling, soils work and prior drilling to develop a geological model of the Mohave property. That model will give Black Mountain, M3 Metals and the Millennial team the ability to select drill targets.
“Thanks to the lead time work of M3 Metals combined with our recent environmental work we hope to be applying for drill permits Q3 2021” said Harris.