Contango Silver & Gold Hits 140 g/t Gold at Lucky Shot as KM Vein Drilling Advances

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2. As of the date of this article, officers, contractors, shareholders, and/or employees of Streetwise Reports LLC (including members of their household) own securities of Contango Silver & Gold Inc.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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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.

Key Investor Takeaways

• New assays from the 2026 surface program at Lucky Shot include 140.23 grams per tonne gold over 0.63 meters, and the company's CEO says the results demonstrate continuity of the Coleman segment of the vein system.
• All intervals are downhole core lengths; true widths are not yet known.
• The surface program totaled approximately 5,800 meters in 27 holes and concluded on August 31, 2026, with some assays still pending.
• Underground development has reached about 54% of a planned 830 meters, and KM vein drilling is underway with assays expected in the fourth quarter of 2026.
• An updated mineral resource estimate is targeted for the first half of 2027, followed by a feasibility-level study on a five-year mine plan of 40,000 to 50,000 ounces a year.
• Two analysts maintained positive ratings on the company before the latest results, while flagging costs at the Manh Choh mine.

Lucky Shot Drilling Hits High-Grade Gold at Coleman

Contango Silver and Gold Inc. (CTGO:TSX; CTGO:NYSEAMERICAN) reported new assay results on October 6 from its 2026 surface drilling program at the Lucky Shot Project in Alaska, including 140.23 grams per tonne (g/t) gold over 0.63 meters in hole LSS26018.

The same hole returned 9.97 g/t gold over 4.57 meters, including 86.98 g/t gold over 0.39 meters. Hole LSS26021 intersected 18.16 g/t gold over 3.65 meters, including 61.73 g/t gold over 0.52 meters. Hole LSS26019 returned 13.80 g/t gold over 2.74 meters, including 118.36 g/t gold over 0.30 meters, plus 27.28 g/t gold over a separate 0.36-meter interval.

On a webinar held after the release, Vice President of Exploration Dave Larimer said the holes from Pads D, E, and F were designed to target the heart of the Coleman vein system. "To me, it's really exciting to see this picture coming together from basically the heart of the system," Larimer said.

The company noted that all reported intervals are downhole core lengths and that true widths are not yet known and may be materially different.

The results cover nine holes from Coleman Pads C, D, E, and F and are the second batch from the program, following a first set reported on September 1. The surface program ran from June 22 to August 31 and totaled approximately 5,800 meters in 27 holes from five pads.

"The results demonstrate the continuity of the Coleman segment of the Lucky Shot vein system as well as better constrain the location of previously mined zones of the Coleman segment," Chief Executive Officer Rick Van Nieuwenhuyse said in the release.

More Coleman Results as KM Vein Drilling Advances

At Pad D, hole LSS26017 intersected 46.32 g/t gold over 0.30 meters from an unassigned vein and 15.86 g/t gold over 0.30 meters, in addition to the LSS26018 results. At Pad E, hole LSS26031 returned several intervals, including 3.94 g/t gold over 1.26 meters. A deeper 3.92-meter interval in that hole contains visible gold and has assays pending. The company cautioned that visible gold does not establish the grade or economic significance of the interval. Assays for hole LSS26025 at Pad F are also pending.

At Pad C, hole LSS26006 intersected 2.87 g/t gold over 1.60 meters, along with 7.19 g/t gold over 1.22 meters and 5.88 g/t gold over 0.30 meters in intervals whose vein assignments remain uncertain. Hole LSS26009 returned 10.62 g/t gold over 0.51 meters. Two step-out holes, LSS26007 and LSS26008, had no significant intervals but intersected the Lucky Shot Fault. Larimer said on the webinar that, from a geology standpoint, the two holes were "a huge success" because they helped fix the position of the fault that offsets the Coleman and Lucky Shot veins.

Cantor Fitzgerald analyst Mike Kozak maintained a Speculative Buy rating and a US$32 price target.

Several intercepts in the release are not yet assigned to a modeled vein. Larimer said an unassigned interval is mineralization that the team cannot yet confidently tie to a known vein, which makes it a target for future work. When the webinar host asked whether the Coleman 4 vein was turning into the backbone of the system, Larimer was more cautious. "I would interpret it more as maybe a major artery," he said.

Underground, exploration development has advanced 450 meters of a planned 830 meters, or approximately 54%. Crews are working two shifts around the clock on three headings. The 2090W West Drift Extension is complete, and the company expects to finish this phase in the middle of the fourth quarter of 2026, subject to operating conditions.

Drilling of the KM vein system from the West Drift Extension began on September 16. The program comprises approximately 1,140 meters in 17 planned holes from five stations. Ten holes are complete, and assays are expected in the fourth quarter. Van Nieuwenhuyse said on the webinar that the KM vein sits at a different orientation from the Lucky Shot vein, at right angles and much flatter. "There's a lot of detailed geology to do," he said.

A Century-Old Vein System Heads for a 2027 Resource Update

Van Nieuwenhuyse said in the release that the drilling will feed an updated mineral resource estimate in the first half of 2027, followed by a feasibility-level study targeting a five-year mine plan of 40,000 to 50,000 ounces of annual production.

Larimer said on the webinar that the vein system has been explored since the early 1900s and that Coleman's last resource update was in 2023. He said some historic holes were taken out of that model because their assays could not be confirmed, which left the resource in the indicated category, and that this year's drilling was aimed at upgrading that classification.

Freedom Broker analyst Vitaly Kononov maintained a Buy rating and a US$30 price target.

Lucky Shot is an exploration-stage property with no declared mineral reserves. The company said the results do not demonstrate economic viability and that the release does not report a new or updated resource estimate.

Contango owns 100% of the project, which covers approximately 8,600 acres of the State of Alaska and patented mining claims in the Willow Mining District, about 75 miles north of Anchorage. The company completed its purchase of the claims and a 2% net smelter return royalty from Alaska Hardrock Inc. on July 1, according to its second-quarter results release.

Contango also holds a 30% interest in the Peak Gold joint venture, which leases approximately 675,000 acres for the Manh Choh project. An indirect subsidiary of Kinross Gold Corp. (K:TSX; KGC:NYSE) owns the other 70% and operates the venture. The company leases the Johnson Tract project, approximately 21,000 acres near tidewater about 125 miles southwest of Anchorage. It also holds additional Alaska mining claims and approximately 247,000 acres of mineral tenures in the Kitsault Valley in British Columbia's Golden Triangle.

Gold Holds Its Ground as Central Banks Keep the Faith

Gold futures opened at US$4,169.20 per ounce on Tuesday, October 6, up 0.3% from Monday's close, and reached US$4,187.30 in early trading, Tim Manni reported for Yahoo!Finance. The metal was up 0.5% from a week earlier and 6.5% from a year earlier. Manni wrote that safe-haven demand from other countries was lending support and noted a 78.4% chance the Federal Reserve leaves interest rates unchanged later this month.

Central bankers meeting this week at the London Bullion Market Association's annual conference in Sorrento, Italy, said gold remains a core reserve asset even as bond yields climb, Reuters reported on October 5.

"Gold is a safe haven asset, probably the safe haven asset, as proven by its performance over time and across a broad range of crises," Bank of Italy Deputy Governor Sergio Nicoletti Altimari said. Analysts told Reuters that central bank buying and safe-haven demand have kept prices above US$4,000.

Central banks bought a net 288.9 tonnes in the second quarter of 2026, up 62% from a year earlier, and a record 45% of those surveyed expect to increase their own gold holdings over the next year, according to the World Gold Council.

Analyst Sees 'Genuine Execution Signal' at Contango

In a September 10 flash note, Freedom Broker analyst Vitaly Kononov maintained a Buy rating and a US$30 price target on Contango, which was trading at US$19.78 at the time. Kononov was responding to the company's September 8 project update, which he described as broadly positive. He wrote that field programs were progressing broadly on schedule and within budget across the company's four main assets.

"Running three simultaneous field campaigns and delivering more than 50,000 meters of combined drilling in a single season, without missing a stated milestone, is a genuine execution signal for a company this size," Kononov wrote.

On Lucky Shot, Kononov noted that surface drilling was completed broadly in line with plan and that underground development was providing additional drill access. He wrote that the project's high-grade intercepts reinforce the view of underground potential that can be advanced toward feasibility-level design, and he listed the remaining Lucky Shot assays among near-term catalysts. He also noted that the target for the Lucky Shot feasibility study had shifted from the first half of 2027 to later in 2027.

Kononov's main caution concerned costs at Manh Choh, where second-quarter all-in sustaining costs (AISC) of US$2,877 per ounce were well above the company's long-term target. He called the third-quarter results, expected in November, the decisive near-term catalyst. His target is based on a net asset value approach across the company's four deposits, using a 0.8x price-to-net-asset-value multiple.

In an August 14 report, Cantor Fitzgerald analyst Mike Kozak maintained a Speculative Buy rating and a US$32 price target, with the stock at US$19.48. Kozak called the company's second-quarter results mixed. He wrote that results improved from the prior quarter on higher production and derivative gains, but that Manh Choh continued to process lower-grade ore during its transition to the South Pit, which kept costs elevated. Contango's share of first-half production at Manh Choh, 17,000 ounces, was tracking behind full-year guidance of 40,000 to 45,000 ounces, he noted, while AISC of US$2,830 per ounce was above the guided range of US$2,200 to US$2,300. Contango ended the quarter with US$89 million in cash, and full-year guidance was unchanged.

Chris Temple of The National Investor wrote in his September 27 newsletter that Contango "is one of the most robust economic stories in precious metals anywhere," pointing to what he called "one of the highest-grade open-pit gold mines in the world" in Alaska.

Ownership and Share Structure¹

About 10% of Contango is held by insiders and about 45% by institutions. 

Its market cap is US$561.35 million with 33.45 million shares outstanding. It trades in a 52-week range of US$14.50 and US$34.38.

Common Questions from Investors

What are the standout assay results in the October 6 release? Hole LSS26018 returned 140.23 g/t gold over 0.63 meters and 9.97 g/t gold over 4.57 meters. Hole LSS26021 returned 18.16 g/t gold over 3.65 meters, and hole LSS26019 returned 13.80 g/t gold over 2.74 meters.

Do the reported lengths reflect the true width of the veins? No. The company said all intervals are downhole core lengths and that true widths are not yet known and may be materially different.

How far along is the underground program? Underground development has completed 450 meters of the planned 830 meters, or about 54%. KM vein drilling started on September 16, with 10 of 17 planned holes finished and assays expected in the fourth quarter of 2026.

What is the planned timeline for resource and feasibility work? An updated mineral resource estimate is targeted for the first half of 2027, followed by a feasibility-level study on a five-year mine plan of 40,000 to 50,000 ounces of annual production. Lucky Shot remains an exploration-stage property with no declared mineral reserves.

Are all surface program results reported? No. This release covers nine holes from four pads. Assays are still pending for one interval in hole LSS26031 and for hole LSS26025, among others.

What are analysts saying about Contango? Freedom Broker analyst Vitaly Kononov maintained a Buy rating and a US$30 price target on September 10.

Cantor Fitzgerald analyst Mike Kozak maintained a Speculative Buy rating and a US$32 price target on August 14. Both noted elevated costs at Manh Choh.

What is the outlook for gold? Gold futures opened at US$4,169.20 per ounce on October 6, according to Yahoo!Finance. Reuters reported that central bank buying and safe-haven demand have kept prices above US$4,000.