Drilling Nearly Doubles Strike Length at Historic Mining District

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Dakota Gold Corp. (DC:NYSE American) announced that step-out drilling north of the JB Gold Zone at its Maitland Gold Project in the Homestake District of South Dakota has nearly doubled the known strike-length of the Homestake iron-formation hosted gold mineralization at the project.

This year's drill program has delineated four distinct ledges, each of which has yielded high-grade Homestake Mine-style gold intercepts analogous to the gold mineralization found in the "West Ledge" system that produced about 6 million ounces (Moz) of gold at the historic Homestake Mine, the company said in a release.

The drilling at Maitland so far has generated 49 intercepts from 73 holes at an average grade of 10.11 grams per tonne gold (g/t Au) over an average thickness of 3.8 meters, Dakota said.

"The results of our drill programs at Maitland have demonstrated beyond doubt that the same mineralizing fluids that produced the Homestake Mine are repeatable and have mineralized the exact same host rocks at Maitland," Chief Operating Officer Jerry Aberle said.

Analyst Peter Bell with Canaccord Genuity Capital Markets wrote in an updated research note Tuesday that "Dakota continues to extend and better understand the high-grade mineralization at Maitland."

"Those of us that worked at the Homestake Mine or were engaged in Homestake's exploration of the corridor extending north of the mine have waited a long time for the opportunity to prove that these Homestake Mine-style deposits are repeatable. We've now demonstrated that with our results to date, and we've only just begun."

Analyst Peter Bell with Canaccord Genuity Capital Markets wrote in an updated research note Tuesday that "Dakota continues to extend and better understand the high-grade mineralization at Maitland."

"In our view, the results released this morning demonstrate the prospectivity for a substantial Homestake-style deposit and underscore the continuity of mineralization at JB," wrote Bell. "To date, the company's program at Maitland has generated 49 intercepts from 73 holes at an average grade of 10.11 g/t Au over an average thickness of 3.8 meters. In our view, the continued advancement of Homestake-style targets adds excitement and optionality to the Richmond Hill deposit located to the west."

Ledges Remain Open Along Strike, to Depth

The historic Homestake Mine, about 3 miles south of Maitland, produced 41 Moz Au and 9 Moz silver (Ag) over 126 years. The company has 48,000 acres of holdings surrounding the original mine, which was first discovered in 1876 and consolidated by George Hearst. Dakota Gold first began its drill programs to test the Maitland project in 2022 and has made two discoveries.

Dakota noted that "while the modeling of the Maitland gold system had previously appeared to share a similar sized footprint with the West Ledge system of the Homestake Mine, this step-out drilling has substantially extended the mineralization northward, with the system still open to further expansion to the north, south and at depth."

Highlights of the results include:

• Step-out drill hole MA24C-058 intersected 28.10 g/t Au over 0.8 meters. MA24C-058 is located 710 meters northwest of the JB Gold Zone discovery drill hole MA23C-017, nearly doubling the length of the known mineralization.
• MA23C-032D intersected 14.45 g/t Au over 1.8 meters
• MA24C-051 intersected 8.93 g/t Au over 3.5 meters
• MA24C-055 intersected 11.50 g/t Au over 1.6 meters

With the inclusion of step-out drill hole MA24C-058, the length of all mineralized ledges in Maitland so far is 1,646 meters, the company said. The ledges remain open along strike and to depth.

"My experience as an exploration and underground geologist working 10 years at the Homestake Mine informs my belief that the Maitland drill results identifying Ledges 34, 35, 36, and 37 are analogous to the West Ledges of the Homestake Mine," Vice President Exploration James Berry said. "The Homestake Mine is the world’s largest banded iron formation hosted gold deposit, and similar gold systems include Orla’s Musselwhite and B2’s Back River deposits. The one unique characteristic of the Maitland mineralization is it is close to infrastructure and a 15-minute drive from our head office. As we wrap up our 2024 drill program at Maitland for the year, we will be refining our modeling of the ledges and analyzing the results to create a follow-up drill program for the 2025 year that will target shallower intercepts."

In a flash note update on Dakota on Tuesday, Analyst Andrew Mikitchook of BMO Capital Markets wrote that further extensions or new discoveries at Maitland would bode well for the stock.

"With the completion of the 2024 drill program, the company is currently assessing results with plans to refine the geological model, which will inform a follow-up drill campaign in 2025," he wrote. "In our opinion, further growth through extension of JB Zone or discovery of other high-grade zones at Maitland will be rewarded by the market. We will monitor exploration updates closely."

The Catalyst: More 'Upside Potential' in Gold Than Risk

According to Reuters, gold trimmed its gains on Tuesday after a strong U.S. jobs report, while a softer dollar and easing Treasury yields limited losses as markets waited for more economic data to gauge the Federal Reserve's rate path.

Spot gold was US$2,641.53 per ounce Tuesday morning. Prices were up as much as 0.7% before the U.S. job openings data, Reuters said. U.S. gold futures gained 0.2% to US$2,664.40.

"A strong jobs report could lead the Fed to take a cautious stance on cutting interest rates," Reuters author Sherin Elizabeth Varghese wrote. "Investors' focus turns to the ADP employment report and Fed Chair Jerome Powell's speech on Wednesday, ahead of Friday's payrolls report."

Experts say we are still looking at a gold bull market, but prices "could easily go either way in December — and in the coming months," Aly Yale wrote for CBS News on Monday.

"There is one thing that can drive the price of gold down — and that's a credit crisis when every asset is being sold to urgently raise cash to service debts," said Keith Weiner, chief executive officer of Monetary Metals, according to Yale's report. "A crisis may be coming, though it's hard to say it will be this month. All the other foreseeable events — war, government profligacy and debt, geopolitical shifting — seem much more likely to push more people to buy more gold."

Weiner said the yellow metal had more "upside potential than downside risk" in the near term. "The bull market in gold will likely continue, as all the macro-economic and geopolitical drivers are still in full force," he said.

Ownership and Share Structure

About 25% of the company's shares are with management and insiders, including Co-chairman, Director, President and Chief Executive Officer Robert Quartermain, who holds the most shares at 7.9%, while COO Jerry Aberle holds 4.5%, the company said.

About 26% of its shares are with institutional investors. Top institutional holders include Fourth Sail Capital with 3.9%, Van Eck Associates with 3.7%, Blackrock Institutional Trust Co. with 3.9%, The Vanguard Group Inc. with about 3.6%, Fidelity Management and Research Co. LLC with 2.8%, and CI Global Asset Management with 2.4%.

About 16.5% is with strategic investors, including Orion Mine Finance, which owns about 9.6%, and Barrick Gold Corp., which owns about 2.3%. The rest is retail.

Dakota Gold has a market cap of US$201.14 million, with 93.7 million shares outstanding. It trades in a 52-week range of US$3.25 and US$1.84.