Explorer Launches Maiden Drill Program at High-Grade Saudi Arabia Gold-Copper Project

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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Sun Peak Metals Corp. (PEAK:TSX.V; SUNPF:OTCQB) launched its maiden diamond drilling program at its wholly owned Halahila Gold-Copper Volcanogenic Massive Sulfide Project (VMS) in the Kingdom of Saudi Arabia, according to a June 8 release.

This new drilling initiative, covering approximately 2,500 meters, follows the completion of the company's earlier drilling activities at the Safra VMS Project and represents Sun Peak's second drilling operation in Saudi Arabia for the year.

Sun Peak said the initial phase of the drilling at the Halahila Project will focus on the Halahila Main zone, which recent exploration efforts have revealed to contain a 650-meter-long mineralized gossan (the upper exposed section of an ore deposit or mineral vein), extending up to 30 meters in width. Depending on the outcomes of the initial drilling, the program may see further expansion.

"Halahila has rapidly emerged as one of the most compelling exploration targets in our Saudi Arabian portfolio," said Sun Peak Exploration Manager Arron Albano. "The project exhibits many of the hallmarks of a significant VMS system, including extensive hydrothermal alteration, a 650-meter-long gold and silver-bearing gossan, strong surface geochemistry, and conductive targets at depth that may represent sulfide mineralization."

Albano continued, "Recent exploration has also identified additional mineralized gossans along a 5-kilometer trend south of Halahila Main, highlighting the district-scale potential of the system with a total length of 10 kilometers. This maiden drill program represents the first opportunity to test targets at depth and evaluate the potential for a significant new VMS discovery."

Recent surface sampling at the Halahila Main zone has yielded promising results, with assays returning up to 16.35 grams per tonne (g/t) gold and 180 g/t silver, the company said. Additionally, geophysical surveys conducted in the area have detected electromagnetic (EM) conductors beneath the Halahila Main zone, suggesting potential targets for subsurface sulfide mineralization.

Following the successful drilling of 1,242 meters across 10 holes at two target areas within the Safra VMS Project, the drill equipment was mobilized to Halahila. The core samples from this previous drilling have been sent to SGS Laboratory in Turkey for assaying, and the results will be disclosed once they are available.

"We are pleased to have drilling underway at Halahila immediately following the successful completion of our maiden drill program at Safra," Sun Peak President and Chief Executive Officer Greg Davis said. "Advancing multiple projects from exploration to drilling reflects the strength of our team in the Kingdom and the advantages of operating in Saudi Arabia, where a supportive regulatory environment, excellent infrastructure, and strong government commitment to mining continue to accelerate project development. With drilling now underway at Halahila and core samples from Safra currently being assayed, we look forward to a steady stream of catalysts as we advance our growing Saudi Arabian portfolio."

Exploring Targets Beneath the Halahila Main Zone

The Halahila Project is situated within the Precambrian Arabian Nubian Shield and encompasses a district-scale array of volcanic and sedimentary rocks that are deemed conducive to hosting precious metal-rich VMS mineralization, the release noted.

The initial drilling endeavor at this site is strategically planned to explore priority targets located beneath the Halahila Main zone. This decision follows comprehensive geological mapping, geochemical sampling, and geophysical surveys that have collectively pinpointed signs of a potentially significant mineralized system, the company said.

The drilling will specifically target areas identified by Time Domain Electromagnetic (TDEM) surveys, which have revealed conductive anomalies over a 4.1-kilometer strike length and beneath a 650-meter-long gossan. This gossan is interpreted as indicating potential sulfide mineralization at depth. Recent exploratory efforts have broadened the mineralized scope of the project, uncovering multiple additional gold- and silver-rich gossans extending approximately five kilometers south of Halahila Main. These newly identified gossan zones, which remain untested, highlight the extensive district-scale potential of the project and will serve as a basis for future drilling targets.

The planned 2,500-meter drilling program will consist of multiple diamond drill holes aimed at assessing the geometry, continuity, and potential sulfide content of the primary target areas, Sun Peak said. The drill cores obtained will be meticulously logged, sampled, and sent to accredited laboratories for analysis, with results anticipated after the program's completion. The outcomes from both the recently concluded Safra drill program and the ongoing efforts at Halahila are expected to maintain a steady stream of exploration updates throughout the remainder of 2026.

Both the Halahila and Safra projects benefit from excellent access and favorable logistics, a common feature across all of Sun Peak's projects in Saudi Arabia, according to the company. The Halahila Project is a key component of Sun Peak's wholly-owned exploration portfolio in Saudi Arabia and is part of the company's expanding collection of VMS and precious metals projects within the Arabian Nubian Shield. Exploration conducted thus far has revealed extensive hydrothermal alteration, numerous gossan occurrences, enrichment of precious metals, and geophysical signatures indicative of VMS mineralization.

Experts: Co. Follows Through

According to a review of the stock by Jeff Clark and Daniel Flynn of the Paydirt Prospector on May 28, the authors said they "like it when companies do what they said they would do."

"We also like it when they do it quickly," they wrote. "And that's exactly what we're getting from Saudi-focused explorer Sun Peak."

Shortly after initiating its maiden drilling at the Safra project, Sun Peak expedited its exploration across a substantial set of licenses recently granted by the Saudi government, yielding promising results, they noted.

An independent technical review, bolstered by remote sensing, mapping, and fieldwork, has validated multiple high-priority targets across the seven licenses, spanning approximately 632 square kilometers, Clark and Flynn said. These areas are deemed prospective for VMS mineralization, a type of deposit known for hosting significant copper and gold systems throughout the Arabian Nubian Shield, which underlies all of Sun Peak's portfolio. In total, 58 initial exploration targets have been identified, including 16 potential VMS sites, two potential orogenic gold sites, and 40 targets displaying characteristics of both. Notably, 15 of these targets have been selected for immediate follow-up, with plans to progress to drilling as soon as feasible.

Elsewhere within Sun Peak's portfolio, drilling operations are ongoing. The initial drill program at Safra is a fully funded endeavor targeting VMS systems identified through geophysical and geochemical data. Initial drilling has concentrated beneath areas at Safra Main where high-grade gold and base metals have been found at the surface.

At Halahila, recent explorations have delineated a substantial target zone with historical sampling results yielding up to 16.35 g/t gold and 180 g/t silver, they said.

Exploration is not confined to the newly awarded licenses but continues across Sun Peak's broader portfolio, including at existing projects like Al Miyah, where recent activities have uncovered a new 6-kilometer-long Hilux mineralized trend, the report said.

Clark and Flynn recommended the stock as a Buy.

"Sun Peak remains the first foreign junior to secure 100%-owned exploration licenses in Saudi Arabia," Clark and Flynn said. "And now results will start to arrive — and if they confirm the company's view of strong early discovery potential, the re-rate potential ... remains strong. That's why both Jeff and I have taken positions, and why I've been adding on recent weakness."

The Catalyst: Gold Sees Uptick as Precious Metals Face Challenges

In early U.S. trading on Tuesday, spot gold and silver prices saw an uptick, with gold trading near US$4,338.80 an ounce, marking a 0.20% increase, and silver at US$68.475, up by 0.44%, according to a report by the Kitco NewsWire on June 9. This rise in precious metals comes as oil prices experienced a pullback, U.S. equity futures indicated a positive opening, and market participants anticipated the release of the May consumer price index (CPI) set for Wednesday.

Despite the uptick, the broader macroeconomic environment remains challenging for precious metals, largely due to the impact of last Friday's stronger-than-expected employment report. The 10-year Treasury yield is maintaining levels above 4.5%, the U.S. dollar index is hovering near a two-month peak, and expectations for a rate hike have intensified in anticipation of this week's inflation data. The CPI report is scheduled for release at 8:30 am. ET on Wednesday, followed by the producer price index on Thursday.

Geopolitical tensions have also influenced market dynamics, particularly following a recent U.S. Apache helicopter crash near a key waterway, although both crew members were rescued, Kitco reported. This incident occurred amidst ongoing tensions following Sunday's exchange between Iran and Israel and a fragile ceasefire. President Donald Trump hinted that a deal with Iran could be reached within "two or three days," though significant hurdles remain concerning uranium, sanctions, and frozen assets.

Following the recent downturn in gold prices last Friday, there could be further declines ahead, yet some market analysts suggest that investors should look beyond short-term fluctuations and consider the broader market dynamics, noted Neils Christensen for Kitco News on June 8.

In a recent analysis released on Monday, Fawad Razaqzada, a market analyst at FOREX.com, pointed out significant technical damage to gold's price chart, according to Christensen. This occurred after gold fell below its 200-day moving average last Friday. Razaqzada warned that gold might approach a critical support level at US$4,000 per ounce this week if inflationary pressures intensify unexpectedly.

He recalled a similar scenario from September 2023 when gold last fell below its 200-day moving average, which precipitated an additional 5% drop in its price. "The technical picture has deteriorated noticeably following last week's sell-off. Gold's inability to sustain gains above the US$4,500 region ultimately left the market vulnerable to a deeper correction, with the break beneath the 200-day moving average accelerating downside momentum," Razaqzada explained.

He identified the next significant support level at a long-term ascending trend line near US$4,230. Below this, he noted that support levels thin out until reaching the March lows around US$4,100, potentially paving the way for a steeper decline if selling pressure persists. "Given the current market structure, a move toward the psychologically important US$4,000 level can no longer be ruled out," he added.

Ownership and Share Information¹

Sun Peak Metals has a market cap of CA$67.33 million, with 164.22 million shares outstanding. The company's 52-week range is CA$0.15-CA$0.55.

Management and Insiders own about 23% of shares, and the remaining shares are held by Retail.