TAU.V: Continuing to Develop their Thesis
Thesis Gold is generating positive headlines from the work going into its Ranch and Lawyers projects as it advances towards a universal MRE and renewed PEA in 2024.
tl;dr:
Thesis Gold is continuing to find success with the drill bit with its ambitious 50,000m drill campaign, pulling up strong intercepts on multiple targets. It has also initiated more geotech and met work as it continues to develop a renewed PEA slated for next year.
Intro
Thesis Gold has continued to release positive news on a number of fronts over the past while. The drill campaign is obviously the headline topic, but they also continue other efforts that are worthy of discussion.
To help with my update, I sent CEO Ewan Webster a brief series of questions that he provided some answers to which will be found below.
Just as a brief recap, the two-fold approach of this newly-merged company – simultaneously pursuing further exploration on its Ranch project while continuing to develop and redevelop the mine plan of its Lawyer project – is a big part of what I like about the newly-merged Thesis, as I discuss in more detail here. There’s strong evidence already of a viable project from Benchmark’s 2022 Lawyers PEA.
This puts Thesis in a powerful situation. Despite already possessing a (robust-and-improving) economic study on one half of their project, on the other half they haven’t even found the borders of their current mineralized zones and are still identifying new targets and making new discoveries. It is this two-fold approach that provides Thesis with multiple avenues to create rule value for shareholders.
Thesis Update:
Anyway, let’s talk updates:
Non-Drilling Work
Geotech logging of multiple drill holes moving forward at the Lawyers Project to support a pit redesign as they look to go UG first in pursuit of up to 500k oz of 5+ gpt Au.
Geomet work moving forward across both projects to understand and optimise the recovery algorithms. This season’s work will be based on 40 samples, 22 from Ranch and 18 from Lawyers. Note that the PEA had Au recovery ranging from 91-97%.
In terms of marrying the two separate projects successfully, Thesis writes that its work continues “supporting the inclusion of the Ranch Project resource” into the Lawyers Project flow sheet.
The $13m financing is a few days overdue (Sept. 26) but will be closed within a few days. The terms will also reportedly stay the same ($0.93 flowthrough and $1.13 Premium FT shares)
All of the above development work details are courtesy of their 2023-24 Work Plan, released on September 19th. It is well worth a read for any shareholder.
The Drill Campaign
Thesis’s current drill campaign has a series of targets where they were looking to expand via step outs and down dip drilling. The program is over half done drilling, but the great majority of assays are still outstanding.
Step 1: High grade beneath the pit shell.
In the first batch of assays from this season, released on August 29th Thesis proved it has a high-grade zone beneath their current pit shell, boosting the odds they could go UG first to improve economics. So step 1 - confirm high grade mineralisation beneath current pit? Check. See below:
Step 2: Drill out the BV zone for the first time to see what’s still there
This latest batch of assays (BV001, BV002, BV004) released on September 28 was looking to explore the BV zone, which is home to a small, historical, open pit operation. This returned a headline assay of 6.27m of 14.87 gpt Au in BV001, and other intercepts of lesser, but still encouraging numbers in the other holes. BV003 is missing, and I am uncertain if that it was a duster or not returned from the lab yet. I will follow up.
Significant also is the rock samples that are returning extremely high grade numbers. So we have strong assays and strong grab samples promoting further step work. So. Step 2? Check. See the image below of the BV zone for context.
It is always neat to see success occurring in real time - Thesis is returning positive, confirming work, piece by piece, zone by zone, with every new batch of assays.
Just as a side note - personally, I am excited to see what starts coming out of the Steve Zone, which has had at least a couple more holes poked in it this year.
That wraps up my general update on Thesis. Read on for my written Q&A with Ewan. A video interview should be forthcoming shortly as well.
My (Brief) Written Q&A with Ewan Webster
(I plan on having Ewan on my show again soon and am going to try something new with him. Namely, I am hoping to get it set up so Ewan can demonstrate using simple visuals in real time how this season’s drilling is expanding known areas of mineralization, so stay tuned. In the meantime, Ewan sent me some additional content in the form of a brief Q&A email session that I will share below. Any emphasis my own.)
Question 1.
JRI:
How much have you extended the deposit with the last 2 batches of assays, and explain where:
Ewan:
The first set of results for the Dukes ridge deposit were the deepest holes drilled in that zone and extended mineralization at depth by over 50 metres, to over 400 vertical metres (section below). Demonstrating the system remains strong and open at depth
The second set of results were the first modern holes into the BV zone on the Ranch project. They have confirmed the historical mineralization, grades, and strike extent, but probably more importantly is the field work that we have completed around the BV zone. We have managed to demonstrate a significant gold trend extending south from the BV Zone, more than doubling the strike extend to over 400metres. This then merges with significant surface alteration and a significant multi-element soil pathfinder anomaly, the Ring Zone. Neither the BV extension or the Ring Zone have been drilled, but certainly share all the hallmarks of the known zones of gold mineralization on the project!
Question 2.
JRI:
Have you exceeded expectations/or been happily surprised?
Ewan:
On the Lawyers project I don't think we have had any surprises yet, but in my mind that is a really good thing. Based on our modelling we are hitting mineralization as expected, demonstrating the mineralizing system is very robust and well understood. At Ranch the project is obviously a bit earlier stage (pre-resource). Visual results from the drilling have been exceptionally positive. Right now we are drilling at both the Bingo and JK zones where alteration and visual mineralization in our expansion holes are looking excellent, so that's really encouraging.
Question 3.
JRI:
How has your understanding of the deposit improved from the assays coming in?
Ewan:
At the Lawyers project, not much. But as I mentioned that's great! It means we have a really good understanding of the mineralizing system. But the results have demonstrated it remains open and strong at depth. At Ranch, with so few assays back it hasn't help much yet, however silica alteration is a fantastic on the fly guide for us and can drive the drill targeting, as its typically associated with gold mineralization.
Question 4.
JRI:
Any general update that you would want to highlight from the past few weeks that you feel deserves attention?
Ewan:
Not much to be honest. Drilling is going really well as expected and the Baseline work at Ranch is moving along nicely.
So, to conclude, I believe Thesis is developing along a very positive trajectory and that the next 12 months will see them continue to find success as they hit their stated milestones of an updated, universal, MRE, followed thereafter by a renewed PEA.
If and when tailwinds of sentiment return to this sector, I rather expect Thesis will be a strong beneficiary. In the meantime, Ewan and his team continue to advance and grow a very strong project that - in my opinion - is tailormade for M&A transactions with a mid-tier producer. That clear path to positive shareholder based on healthy, still-growing potential and proven value is makes Thesis so interesting to me.
Yes, Thesis already trades at a healthy $100m mc, but it continues to prove up its value independent of a sluggish stock price. And that imbalance between risk and reward I see at play here is why I continue to think Thesis is a smart pick in this sector.
Thanks for reading.
-JRI
