Wallbridge Mining (WM) - Fully Funded for $70M Drill Program

Wallbridge Mining Company Limited is currently advancing the exploration and development of its 100%-owned Fenelon Gold property located along the Detour-Fenelon Gold Trend, an emerging gold belt in northwestern Quebec. Within three years of the discovery of Area 51 and Tabasco/Cayenne Zones, through drill programs totaling 300,000m, Wallbridge reached an important milestone by announcing a maiden MRE (Mineral Resource Estimate) for Fenelon and an updated MRE for the Martiniere Gold Property totaling 2.67Moz gold in the indicated category and 1.72Moz gold in the inferred category. Wallbridge is also the operator, and a 17.8% shareholder in Lonmin Canada Inc., a privately held company with a portfolio of nickel, copper, and PGM (Platinum Group Metals) projects in Ontario’s Sudbury Basin.

Matt Gordon caught up with Marz Kord, President, CEO, and Director, Wallbridge Mining Company Limited. Mr. Kord is a professional mining engineer with over 3 decades of progressive experience in mining operations and project management. Prior to joining Wallbridge in 2011, he held the position of Executive Vice President, Global Mining (now WSP Global) for Genivar Inc., a large Canadian firm, where he led the development and growth of the company’s domestic and international mining profile. During the early part of his career with Falconbridge Ltd., Mr. Kord was involved in mining operations in both Sudbury and Timmins. His expertise includes managing large, multidisciplinary teams of engineers and operators as well as extensive experience in developing strategic growth plans and in M&A (Mergers and Acquisitions). Mr. Kord is the largest shareholder among the Directors and Senior Management.

Company Overview

Wallbridge Mining Company Limited is an advanced exploration-development company driven by a strategic and targeted approach. The company’s Fenelon Gold property and Martiniere Gold property are located on the company’s 910 square kilometres land package along the Detour-Fenelon Gold Trend in Northern Abitibi, Quebec, with significant potential for further discoveries over a 97-kilometre strike length of this under-explored belt. The company was founded in 1996 and is headquartered in Ontario, Canada. It is listed on the Toronto Stock Exchange (TSX-V: WM), and the OTC Markets (OTCQX: WLBMF).

Wallbridge Mining has been exploring the flagship projects along the Detour-Fenelon Gold trend, namely Fenelon and Martiniere properties over the past few years. The company recently released its maiden resource estimate at Fenelon, along with an updated mineral resource estimate at Martiniere. The collective resource estimate for both these properties is about 4.4Moz in the Indicated and Inferred categories with the former accounting for 60%. 

It is important to note that in addition to these 2 gold systems that have been identified on the belt, there’s also a large wall system that has been identified at Detour. The company controls about 900 square kilometres of the land package along the under-explored belt. It has plans to continue the exploration program in 2022. The company is looking to drill about 160,000m at Fenelon and Martiniere. Out of the 160,000m, it has allocated 10,000m for regional exploration in order to follow up on targets and potentially make new discoveries. 

Cash Position 

Wallbridge Mining has had a couple of capital raises in the past few weeks. The management has been highly supportive of the company. Some of the company’s Directors and Management participated in the most recent financing. The company’s CEO, Marz Kord remains the largest shareholder among the Directors and Senior Management. The company’s board collectively owns a 1.8% stake. 

The company has plans to buy back its shares once it is financially feasible. In the first financing round, the company raised $14.2M through private placement, and an additional $15M was raised by way of a bought deal. The capital raise was done to ensure that the company can support its aggressive exploration program, and bring it to the next milestone. 

By 2021-end, the company had about CAD$40M in cash flow. It is expecting a $10M refundable tax credit from the Quebec government, making it a $50M program. The company is looking to improve and expand its existing resources while following up on other targets. It is also looking to conduct studies on the land package. As per the company, the extensive scope of work warrants a $70M program. It is looking to fill that $20M shortfall for its program, as $50M would only carry the exploration program to a certain stage. It seeks to become fully funded, ensuring that the drill program can progress as planned. The aggressive drill program is focused on value generation for the company’s shareholders. It understands the exploration growth potential for both Fenelon and Martiniere assets. 

The company was successful in raising capital with minimal dilution by way of flow-through funds. Wallbridge Mining’s share price was $0.35 during the capital raise, which was done at $0.55. As a project moves closer to the development stage, the possibility of flow-through funds becomes likely, and the company is looking to make the most of this opportunity. 

The company wanted to ensure that the program is well-funded to reach the next milestone. This funding would shield the company from any unforeseen situations that arise from the ongoing geopolitical turmoil or uncertain gold prices in the near future. 

Operational Challenges 

Delayed assay results have been an industry-wide problem. This is majorly a result of the pandemic-related restrictions imposed on the labs. Additionally, the advent of Omnicron early this year led to a lot of absenteeism in the workforce, directly impacting the company’s drill programs. 

Previously, the labs had a standard assay turnaround time of 4-6 weeks, but nowadays, the turnaround time is between 4-6 months. In order to remedy this problem, the company entered discussions with multiple labs to devise a solution. It was successful in negotiating with one of the labs to assign a dedicated centre for Wallbridge Mining. This was possible due to the scale of the planned 160,000m drill program. The company closed the deal in early March. These developments are expected to show results in the next couple of months. The company expects the assay turnaround to be back at the standard 4-6 weeks delivery time. 

Drill Operations

In early January, Wallbridge Mining published a press release highlighting the 2022 drill program. The company has plans to drill a total of 160,000m, where 60% of the metres will be allocated to Fenelon, 30% for Martiniere, and 10% for regional exploration. The company is also looking to conduct Economic Studies along with Baseline Studies, Environmental work, geotechnical, and geochemical work to advance the project to the next stage. The 2022 drill program has an estimated $70M CapEx (Capital Expenditure) and is detailed in the press release. 

In November 2021, the company disclosed a 4.4Moz resource estimate. Originally, the company had plans to conduct an open-pit operation. The pit wasn’t expected to reach a 600m depth. As a result, the pit’s surface exploration area has now grown to a 1km x 1km area. 

The resource has good grades, with 1.45 in the indicated category and 1.33 in the open-pit category. It has a high strip ratio. It is important to note that 50% of the open pit's footprint had fairly limited drilling before it was brought into the category. The previous operators did not expect the open pit to be such a large size. As a result, the area wasn’t sampled for open-pit material and certain areas weren’t drilled at all. For the Fenelon asset, the company has allocated 100,000m of planned drilling, out of which 25,000m-30,000m of drilling will be focused on resource improvement. This will enable the company to provide a meaningful resource update, for either an open-pit or an underground scenario. 

Based on the resource sensitivity table, the underground portion has about 2.7Moz in Indicated and Inferred at the one-and-a-half cut-off and about 3.3Moz-3.4Moz of the combined resource. When compared to Young-Davidson’s asset which is mining at 2.17-2.65Moz, Wallbridge’s asset has a very respectable underground deposit. The aggressive exploration program will help Wallbridge to improve and expand the existing resource. 

Based on rough estimates, 105,000m-110,000m drilling is allocated to Fenelon, out of which 25,000m-30,000m is assigned for infill drilling or the open-pit area. The other 80,000m of drilling will be focused on the expansion of the Sunday Lake Deformation Zone. Notably, the expansion prospects for this zone have been previously identified. This zone is located 1km away from the edge of the existing pit shell. Past drill operations indicate that the deposit has the potential to grow all the way to the Sunday Lake Deformation Zone. The deposit is open in all directions, and the company is looking to expand the mineral resource towards the southwest, the west, and the northwest. The previous owners carried out about 55,000m of infill drilling in this area. However, the deposit was never sampled for open-pit. This year, Wallbridge Mining plans to conduct open-pit sampling, which in turn, would help add additional ounces to the resource. 

Targets 2022 and Beyond

Wallbridge Mining does not plan on becoming a perpetual explorer, instead, it is focused on reaching the next milestone for the Fenelon asset. Since the deposit is open-pit with a high strip ratio, the company is looking to conduct an Economic Study. The second priority is to grow the deposit to a stage where the economics are well-understood and potential growth can be attained. 

The company had originally planned to develop an operation with a 500t/day mill processing capacity, which was based on the Gabbro area. The company anticipates that the Q1 2023 mineral resource update will help determine the mill’s daily processing capacity. This milestone will serve as a platform for the project’s economics. The Economic Study is expected to conclude between mid to Q4 2023. 

In a press release published today, the company shared its findings from the underground exploration. Interestingly, the discoveries of the deposit at Area 51 have never been seen before, except for two and a quarter inch drill holes that are drilled with a 25m-100m spacing. Even though the company is focused on an oriented core, it also needs to run underground operations in order to better understand and simultaneously de-risk the project. The work done so far confirms that the drill holes crossed through the veins with a drift, verifying the company’s original model. It also confirms through the modelling done at Fenelon that the oriented core is solid. 

Wallbridge Mining has a 3D model for both the Fenelon and Martiniere deposits, which is available on the company’s website. This model showcases the growth potential of the deposit. Since past drilling wasn’t conducted to the required density, it couldn’t be included in the mineral resource. However, additional drilling will enable the same.

Every press release published by the company comprises the highlights of its drill results. It also consists of a table of drill holes where assays have been received. For instance, a press release might have 4 highlight assays identified on the first page. It may comprise 20-30 drill holes that have been reported. The average drilling for each hole is 600m-700m because the company has drilled holes that are over 1,000m. Hence, a report on 20-30 holes is essentially the result of 20,000m of drilling that has already been assayed. The company has a limited backlog of assays from last year. It discloses press releases and drill results only after the assay results are available. 

Comprehensive drill hole information and press releases are available on the company’s website. The company updates the Verify periodically. The current verify model was updated 2 weeks back and has the most updated information. The company has plans for a quarterly update on the model. This would allow investors to look up the existing model and new assays in a convenient fashion. Wallbridge Mining’s BMO conference provides in-depth information on its current resource along with the company’s 2022 plans.

To find out more, go to the Wallbridge Mining website