Liberty Gold Corp. (LGD:TSX; LGDTF:OTCQX) launched both a 40,000 meter (40,000m) drill program with a single rig and a bulk metallurgical sampling campaign at its Black Pine gold project in Idaho for the upcoming feasibility study (FS), reported 3L Capital Analyst Steven Therrien in a May 13 research note.
"[The company's] drilling and metallurgical plan will significantly derisk the mine plan, especially in the early years/payback period, while converting Inferred resources to Measured and Indicated (M&I) and testing new targets," Therrien wrote.
The company has CA$27 million (CA$27M), or US$20M, in cash after raising CA$23M in April through a bought-deal public offering. It spends about US$4.3M per quarter, based on 2024 expenses.
Maximizing the Resource
Therrien reported Liberty's objectives for the Black Pine drill program, now underway. The zones of focus for drilling are Discovery, Rangefront, CD, F and M. At Discovery, infill drilling is being done to convert Indicated resources to Measured, to significantly derisk the early years of the mine's life and payback period.
The goal of drilling at Rangefront is to expand the near-surface and higher-grade oxide gold mineralization discovered in 2024 there and convert existing resources to M&I resources. Because Rangefront has the highest-recovery oxide material at Black Pine, additional ounces are highly accretive.
Similarly, drilling at the CD, F and M zones will convert Inferred ounces to M&I ounces to ensure they are included in the upcoming mine plan.
Right now, only one rig is active at Black Pine. A second rig, is expected to arrive and be running at the site in the latter part of May.
Testing the Heap-Leach Pad
Historical estimates suggest the legacy heap-leach pad at Black Pine could contain about 50,000 ounces (50 Koz) of recoverable gold, so Liberty is placing 20 sonic drill holes over 1,200m there to determine if this in fact is the case, Therrien explained.
If it is confirmed and if drilling outlines a resource gold grade above 0.1 gram per ton, these high-margin ounces, not included in the 2024 prefeasibility study mine plan, could be added to the updated version and stacked on the planned new pad just to the east. This would create room for expansion of the heap-leach pad's capacity and would shorten haul distances, ultimately improving cash flow early on.
More Metallurgical Testing
Liberty is also doing two additional phases, six and seven, of metallurgical work. This entails surface bulk sampling program to support large diameter column testing and column testing of lower-grade oxide material near the reserve cutoff grade. This work is to determine gold recovery rates.
Additional Evaluations
Also planned are a hydrological assessment and soil and bedrock investigation. These will include installing additional monitoring wells, large-scale aquifer pump testing and determining soil/bedrock properties to choose the ideal locations for infrastructure.
Ultimately, the results of these efforts and of other baseline studies will be used in the requisite Black Pine environmental impact statement.
Acquisition Target
As reported by Therrien, the estimated net present value discounted at 5% of Black Pine as noted in the 2024 prefeasibility study is US$552M, using a US$2,000 per ounce (US$2,000/oz) gold price. Over a 17-year life of mine (LOM), the operation would produce an average 135 Koz per year at an all-in sustaining cost of US$1,380/oz. However, Liberty is looking into the possibility of expanding capacity by 30% in the FS, taking average LOM production even higher.
"With an anticipated increase to the LOM average production profile, increased confidence in the resource and gold recoveries, and low upfront capex, Liberty is a Top 5 North America gold developer takeout candidate," Therrien wrote.
Catalyst-Rich Years Ahead
Therrien outlined the future events for investors to watch for. At Black Pine, the fieldwork Liberty just announced will be carried out throughout most, if not all, of the rest of this year. A mineral resource update will follow, in late 2025 / early 2026. Next, the FS will be completed, likely in H2/26.
Also, this year, Liberty plans to advance its Goldstrike project in southwest Utah. Specifically, at the area of the property where the company discovered antinomy, Antimony Ridge, fieldwork, drilling, procuring of funds, and antimony processing studies are slated to be done. Subsequently, the plan is for Liberty to spin out Goldstrike, including Antimony Ridge, most likely in 2025.
Ownership and Share Structure
Ownership of Liberty Gold, noted by Therrien, breaks down like this: insiders own 4%, Wheaton Precious Metals Corp. (WPM:TSX; WPM:NYSE) has 4%, institutional investors hold 48% and retail investors account for 44%.
The company has 454.3 million shares outstanding. Its market cap is CA$130M. Its 52-week low and high are CA$0.25 and CA$0.43 per share. The stock's current price is CA$0.285 per share.
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Important Disclosures:
- Liberty Gold Corp. is a billboard sponsor of Streetwise Reports.
- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
- 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.
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Disclosures for 3L Capital, Liberty Gold Corp., May 13, 2025
3L Capital has prepared this report for informational purposes only. It is intended to provide general information and should not be interpreted as a solicitation to engage in securities transactions, a recommendation to buy or sell securities, or investment advice. The opinions expressed in this report reflect the author's views as of the report's date. It is strongly advised that recipients conduct their independent investigations and seek professional advice before making any investment decisions. While the information contained in this report is derived from sources believed to be reliable, its accuracy cannot be assured. It should be noted that 3L Capital, along with its affiliates and associates (collectively known as "3L Capital"), may have provided financial advisory and other services to the companies mentioned in this report in the past or may do so in the future. As a result of rendering such services, 3L Capital may receive financial and other incentives from these companies. 3L Capital employees and affiliates may hold positions in and may buy or sell securities of companies mentioned in this report. For a detailed discussion of company-specific risks, please refer to the "Risk Factors" segment in the company's MD&A section.
