The Critical Investor looks at a junior miner that has been raising cash and acquiring additional claims for its Ontario projects.
Platinex Inc. (PTX:CSE; 9PX:FSE) doesn’t seem to be slowing down anytime soon, as it has been adding more claims to the highly prospective and strategically located district-scale Shining Tree gold project and recently acquired W2 Copper-Nickel-PGE project, both located in mining-friendly Ontario. As management and board of directors were strengthened, and a high-quality core investor base came in since, one of the last building blocks remaining was filling the treasury with adequate funding. As a first tranche of CA$1.5 million (M) was recently closed, with a final tranche coming up soon, it seems Platinex is ready to complete targeting and design drill programs for both Shining Tree and W2. In my view, strong drill results, positive metal price movements, and renewed enthusiasm in the Ring of Fire after the recently finalized acquisition of Noront by Wyloo Metals could provide substantial catalysts for share price appreciation in 2022.
It is no small feat for a tiny junior with a CA$8M market cap to raise CA$1.5M, but Platinex didn’t seem to have much trouble with it, raising this in a month. It was a non-brokered private placement, with a first tranche closed at April 5, 2022, consisting of 16M common shares at CA$0.05, and 12.2M flow-through common shares, both with a half warrant (three years at CA$0.07). The aforementioned second tranche will probably close within two weeks from now.
Right before the closing of this first tranche, Platinex was busy expanding their Shining Tree claim package, as it acquired another 1,372 hectares, bringing the total at 23,219 hectares. This came at limited costs of just CA$11,500 in cash and 400,000 shares. The claims are subject to a 2% NSR, of which 1% can be bought back for CA$800,000.
As can be seen, the new claims cover numerous faults, associated with the prospective Ridout-Tyrell Deformation Zone (RTDZ), which hosts several world-class gold deposits like Coté Gold (IAMGold) and Juby (Aris Gold):
A lot of reconnaissance exploration has already been completed, and more recently results of an airborne magnetics survey and a LIDAR survey came in, enabling management to determine drill targets, so Platinex will be ready to go when the ongoing financing will be completed soon. The understanding of the project has improved considerably, and lots of IP targets have been defined, correlating with the RTDZ trend, high gold counts and/or high multi-element anomalies in the gold till fines:
What to expect from drilling? As a reminder, Platinex already completed a 51 drill hole program a while ago at the important Herrick target (one of seven to eight target zones within Shining Tree), and hit gold at almost every hole, with highlights accounting for 7.15 meters at 2.76 g/t Au, 46.3 meters at 0.65 g/t Au, 7.2 meters at 2.38 g/t Au, 14.1 meters at 1.2 g/t Au and 12.2 meters at 1.47 g/t Au, all within open pit depths.
Mineralization at the Herrick target is open at depth, and management hopes to find more mineralization at depth, as lots of deposits in the Abitibi show these characteristics. There are many more targets to be drill-tested, and management is currently outlining plans for this at the moment as mentioned. According to the presentation, a Phase 1 program has already been completed (1,270m), confirming Vein 109 on the Caswell target. The intended but still preliminary Phase 2 could see 5,000 meters of drilling, of which a part is thought to be deeper drilling, and another part could be definition drilling on the Herrick, Churchill, and Ronda targets. Through this program, management intends to complete a maiden NI43-101 resource estimate for Herrick.
Besides Shining Tree, Platinex is also active on the W2 front, as it expanded this project two times since my last article in January. On March 17, 2022, it acquired 2,932 hectares, bringing the total claims to 15,973 hectares. The staking fees were CA$7k as the claims just lapsed.The W2 Project now covers approximately 80% of the layered mafic-ultramafic Lansdowne House Igneous Complex (“LHIC”) which is highly prospective for copper-nickel (Cu-Ni) and reef-type platinum group element (PGE) deposits.
Keep in mind, Wyloo recently acquired nearby Noront Resources Ltd. (NOT:TSX.V) for its high-grade Eagle’s Nest Ni-Cu-PGE deposit, for CA$616.9M after a bidding war with a formidable competitor: BHP. As BHP is known for doing extremely thorough due diligence on its transactions, it seems certain it saw compelling reasons to bypass the usual Ring of Fire objections, as this area still has been underdeveloped due to lack of infrastructure. The Ring of Fire has been viewed as one of the most promising mining opportunities in Ontario for more than a century.
Wyloo certainly thinks so too, as it has already laid out a comprehensive strategy and budget to advance Eagle’s Nest towards production, as part of their overall battery-related commodity strategy. Wyloo is owned by Australian mining billionaire Andrew Forrest, who is betting heavily on green energy of late. When such powers seek to speed up slow moving ventures like the Ring of Fire, it might be safe to say that such initiatives will likely attract much more investments, and advance the Ring of Fire as a mining district much faster.
It seems Platinex has timed their W2 acquisition well, and could very well enjoy the benefits of renewed interest in the nearby Ring of Fire.
The widespread Cu-Ni-PGE mineralization of W2 is delineated in at least seven significant mineralized zones within a 7.5 kilometer long folded corridor. The new claims add 10 kilometers of strike length to the project, with W2 extending 35 kilometers along the Lavoie Lake Shear Zone System and tying on to Northern Superior Resources Inc.’s (SUP:CVE) TPK Project. The grey areas are the new claims:
As a reminder, the W2 project has seen significant exploration so far, ranging from sampling to airborne surveys to 8,772 meters of drilling. Drill results for the property were impressive:
- 220.6 meters at 0.56% CuEq or 0.96 g/t PdEq (LH-01-06)
- 151.6 meters at 0.45% CuEq or 0.771 g/t PdEq, including 17 meters of 1.08% CuEq or 1.86 g/t PdEq (LH-01-05)
- 42 meters at 1.02% CuEq or 1.8 g/t PdEq, including a high grade 4.5-meter section of 4.52 g/t PdEq (LH-01-02)
- 61 meters at 1.01% CuEq or 1.73 g/t PdEq
- 20.91 meters at 1.63% CuEq or 2.80 g/t PdEq
- 42 meters at 1.02% CuEq or 1.76 g/t PdEq
Please note holes LH-01-05 and LH-01-06 are 4 kilometers apart with no intervening drill holes. The apparent correlation of widely spaced holes suggests a high level of continuity in the Cu-Ni-PGE mineralization. Most results were intercepted close to surface, indicating substantial open pit potential. Numerous targets have already been identified, and the T5 target appears to have the same geophysical signature as Eagle’s Nest (Noront/Wyloo).
Management has designed a two-phase drill program for W2, although this is still preliminary: Phase 1 might see 2,500 meters of drilling, focusing on infilling areas of high grade near surface PGE mineralization, and among others filling in between holes LH-01-05 and LH-01-06. Phase 2 could also see 2,500 meters of drilling, but will likely be more greenfields, as conductors with coincident magnetic anomalies will be drill tested for the first time. It will mainly focus on the T5, T6, T7, T8, and T11 targets. It will be a busy summer for Platinex, with a decent amount of drilling planned, and with management looking for further acquisitions.
It will be interesting to see how much Platinex will be raising in total in the ongoing financing, as they already landed CA$1.5M, which already goes a long way when exploring in Ontario, where drilling cost are pretty cheap (CA$200/meters). The second tranche will add more to the treasury, so Platinex will have enough to complete lots of exploration for this year. I am looking forward to the finalization of exploration programs, and expect a lot from both projects, as historic drill results were already impressive and consistent. Stay tuned!
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Please note: the views, opinions, estimates, forecasts or predictions regarding Platinex’s resource potential are those of the author alone and do not represent views, opinions, estimates, forecasts or predictions of Platinex or Platinex’s management. Platinex has not in any way endorsed the views, opinions, estimates, forecasts or predictions provided by the author.
The Critical Investor is a newsletter and comprehensive junior mining platform, providing analysis, blog and newsfeed and all sorts of information about junior mining. The editor is an avid and critical junior mining stock investor from The Netherlands, with an MSc background in construction/project management. Number cruncher at project economics, looking for high-quality companies, mostly growth/turnaround/catalyst-driven to avoid too much dependence/influence of long-term commodity pricing/market sentiments, and often looking for long-term deep value. Getting burned in the past himself at junior mining investments by following overly positive sources that more often than not avoided to mention (hidden) risks or critical flaws, The Critical Investor learned his lesson well, and goes a few steps further ever since, providing a fresh, more in-depth, and critical vision on things, hence the name.
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