Kingfisher Metals (KFR) - Grading 60g/t Gold as Drill Season Starts

Matthew Gordon caught up with Dustin Perry, CEO of Kingfisher Metals, for an update on the upcoming activity at the company’s Goldrange project. The company is looking to build a gold resource there and will have two rigs operating throughout the summer season at the British Columbia site.

Overview of Kingfisher Metals

Kingfisher Metals, a Canadian company based in Vancouver, focuses on the exploration of its gold and copper properties in British Columbia, Canada. Kingfisher holds three projects: 

1.  Goldrange, a 367 282 sq. km parcel with numerous zones of high-grade gold mineralization,

2.  Ecstall, a 282 sq. km tract with over 40 copper-gold volcanic massive sulphide (VMS) targets, and

3.  Thibert, a 124 sq. km gold opportunity with past production of some 200,000 oz. of placer gold.

Additional Details About Goldrange

Kingfisher has a 100 percent interest in the Goldrange property. The project is part of an area of high-grade orogenic gold mineralization similar in style to that at the nearby Bralorne Gold Mine, which produced 4.2M oz. of gold at 17.7 g/t.  There are numerous locations of highly anomalous gold and arsenic in stream sediment samples throughout the project area. Despite that, there has been limited historic exploration and no diamond drilling, despite having hand-mining activity dating back to the 1930s. 

Recent company announcements have highlighted the high-quality mineralization discovered at the Cloud Drifter Trend within the Goldrange project area. As an example, a recent discovery of an approximately 60 m trend of veins and breccia produced grades of up to 38.6 g/t of gold in rock chips and 8.42 g/t of gold over 1 m sampled using backpack drilling. 

This Year’s Drilling Program

Kingfisher is about to get two drilling rigs working at its Goldrange project. One is a highly cost-effective RAB (rotary air percussion) rig, which will be on-site on May 17. The other is a diamond drill rig, scheduled to arrive shortly after the RAB rig comes on site. The field crews will be there about a month earlier getting the camp up and running. 

The dual rigs bring the ability to drill more shallow holes, so more targets can be tested. The RAB drill will go in advance, then the bigger rig will follow up afterward. This gives the company the ability to test a full spectrum of targets with a less expensive method for those with near-surface mineralization. And if these targets find pay, the company intends to utilise the diamond drill to test the depth of each occurrence. 

The company plans to drill through the full summer, although the exact amount of metres is not set at the moment. The overall program will require some more fundraising but Perry foresees that the company can commence without one or might do one if the opportunity presents itself. 

The total amount that could potentially be drilled this year with one diamond drill would be around 11,000 m. This would be a bigger program than last year, which was just shy of 5,000 m. As an additional plus, Kingfisher is going to have pad builders on site, which was a bit of an Achilles heel last year. 

What Kingfisher Is Presenting to the Market?

Last year Kingfisher’s share price ranged from 40 to 50 cents to where it is now, hovering in the 20 to 25 cent range.  Perry attributes this drop to potentially unrealistic expectations in the short term. One thing to keep in mind for those expectations, however, is that the company only tested 10 percent of the large Cloud Drifter Trend anomaly. And those tests were quite widely spaced.  In fact, the company had really good first pass results, said Perry, especially considering a lot of it was blind evaluation. 

This year the company is going to follow up on its best hits and drill much more tightly spaced holes on either side and to depth. Essentially, they are looking to prove up some really sizable zones of high-grade mineralization. For example, the first drill test either side of and go deeper at a previously identified 1m intercept of 73.4 g/t of gold. 

In addition, Kingfisher also intends to test the remainder of the Cloud Drifter Trend anomaly that it didn't get to last year. The big take for the market is that Kingfisher will be testing a lot of really good targets. In some ways it’s similar to buying a handful of lottery tickets; one’s odds of a win with many tickets are a lot higher than if one just buys a single ticket. 

Logistical Perspective

Goldrange is located high up in the mountains of British Columbia. Helicopter transport is required, although there are good roads nearby. The Cloud Drifter Trend is about 12 km from an historic road that accesses an old mine and logging activity in that area. Access requires a helicopter but it's not that far of a flight. 

Is There Enough of the High Grade Gold to Make a Mine? 

So far, the high-grade occurrences are confined to rather narrow vein widths, making investors wonder if there is enough of the high-grade stuff to potentially make a mine or will lower-grade ore within the country rock be needed for a viable economic situation. Perry understands this as well and that is one of the objectives of this year’s drilling campaign. 

The best country rock is a quartz diorite, which has disseminated mineralization that may be indicative of a larger tonnage that hasn't been drilled yet. It's lower down the mountain. Kingfisher intends to get to those targets this year and Perry thinks there's still plenty of potential for that style of mineralization. Nevertheless, it’s still early in the game. All he can say is that it looks like the widespread nature of the gold mineralization suggests that there's a really big system driving this. 

Capital Situation

Kingfisher’s capital burn rate is relatively low. Most of the company’s spending is going into its drilling and evaluation program.  Any future drilling program will probably require additional capital. Nevertheless, with the low share price, raising capital may not be cheap. 

Communicating with the Market

Perry said that there's not much room for Kingfisher’s stock to go down from this point. He thinks it's only up from here. He was recently down in Peru visiting the company’s largest shareholder who has been buying on the open market, and was just shaking his head regarding Kingfisher’s enterprise value, which is around $12 M and “just absurd”. 

Continuously hitting high-grade mineralization with this summer’s drilling program is going to get the market's attention as well. He anticipates that the company may find higher than expected grades in the quartz diorite country rock. The vein system may have higher widths as well. These orogenic systems can go for long distances, as at Bralorne, which was mined at 2 km depth. So there's a lot of room to grow. 

Kingfisher has also switched to a new lab for assays, in the hope of getting data out sooner. The new lab is using a new Chrysos machine, which is also being used by bigger explorers such as Barrick and Kinross. This machine can analyse coarse- and fine gold at the same time. It's more cost effective but the big key is its 30-day turnaround from the time samples are received at the lab. This will enable fine-tuning of the drilling program in the field as the summer progresses. 

Moving Forward

Perry has the budget to conduct this year’s drilling season. We look forward to the information flow as it becomes available. 

Be sure to read the recent earlier conversation we had with Kingfisher available on Crux Investor. 

To find out more, go to the Kingfisher Metals website