Shares in Bitterroot Resources (TSX-V:BTT) doubled on Tuesday after its US subsidiary secured $5.22 million in government funding to accelerate exploration at the company’s LM nickel-copper project in Michigan.
The stock doubled in price, reaching C$0.16 apiece at 9:45 a.m. in Toronto, before easing to a gain of 82% at C$0.15 later in the session. The US Department of War award will cover half the cost of eligible work, including exploratory drilling, geophysical and geochemical surveys, permitting, labour, equipment and travel.
Trans Superior Resources, Bitterroot’s subsidiary, operates LM and owns 51% of the joint venture, while privately held Below Exploration holds the remaining 49%.
“The non-dilutive funds will reduce our cost of capital and allow the LM project partners to finance and resume an aggressive drilling program,” CEO Michael Carr said.
The government support gives Bitterroot access to substantial exploration capital without issuing shares as the partners pursue the source of high-grade nickel-copper massive sulphide fragments encountered during earlier drilling.
Deeper drilling
Previous exploration at LM included 7,565 metres across 26 core holes reaching depths of 300 metres. Ten holes intersected disseminated, semi-massive or massive sulphide nickel-copper-platinum group metal mineralization within what the company interprets as a magma conduit.
Trans Superior plans to begin a 15- to 20-hole drilling program in the December quarter, with holes ranging from 500 to 700 metres. The campaign will test the interpreted conduit at depths of 400 to 700 metres, extending exploration well below the previous drilling.
Borehole electromagnetic work and other geophysical surveys will help refine targets as drilling progresses. The central objective is to locate the source of the high-grade massive sulphide fragments identified in earlier work, which could help determine whether a larger mineralized system exists at depth.
The LM project is in Michigan’s Baraga basin, a district that also hosts Talon Metals’ (TSX:TLO) Eagle nickel-copper mine.
