Ramp Metals (TSXV: RAMP) shares gained more than a quarter of their value on Wednesday after gold bug Eric Sprott invested in the Saskatchewan explorer.
Sprott is the lead investor in a C$4.5 million stock offering due to close around Aug. 8, Ramp said in a release. It has the Rottenstone SW project that in June reported the Ranger-01 hole result of 7.5 metres of 73.55 grams gold and 19.5 grams silver starting at 227 metres downhole.
The shares, which the company has said are held 60% by management and directors, rose by 28% to C$0.83 apiece by mid-Wednesday in Toronto. The shares are up nearly 340% since listing in March at C$0.19. The company is valued at C$27.5 million.
About 3.8 million shares are to be offered through Canada’s charity flow-through regime at a price of C$0.78 apiece for gross proceeds of around C$3 million, Ramp said. Another 2.7 million shares are to be priced C$0.55 each to raise about C$1.5 million, it said.
CEO Jordan Black commented this month on how a second set of drill results at Rottenstone SW, which is on the same trend as the historic Rottenstone mine, hit mineralization 3 km away from the June Ranger result.
“It shows a cross-regional strike,” the executive said by phone July 8. “Hitting gold in all four holes on our first four holes ever on the property is something people dream of their whole life.”
However, the market knocked Ramp’s stock at the time when the newer results showed hole Rogue-01 cut 4.5 metres grading 0.66 gram gold per tonne from 14 metres depth. Hole Rogue-02 returned 1.5 metres at 0.6 gram from 216.5 metres downhole; and Rogue-03 cut 1 metre at 1.22 grams from 243 metres depth.
The Ranger and Rogue holes comprise Ramp’s initial drilling at the 325-sq.-km project about 700 km north of Regina. It’s on the same geological trend as the former Rottenstone open pit mine 30 km to the northeast. It produced nickel, platinum group metals (PGM) and gold from 1965 to 1969, and is now held by Fathom Nickel (CSE: FNI).
Rottenstone produced 26,057 tonnes with an average grade of 3.28% nickel, 1.83% copper and 9.63 grams per tonne of palladium, platinum and gold from resources estimated to range from 45,000 tons (40,800 tonnes) to 60,000 tons, Fathom Nickel says.
Ramp compares its project with the eye structure of the Nova-Bollinger nickel-copper mine in Western Australia that Sirius Resources sold to IGO (ASZ: IGO) for A$1.8 billion in 2015. Mark Bennett, who led Sirius, is an adviser to Ramp.
The Canadian junior sees an opportunity since most prospectors in northern Saskatchewan are focused on uranium and the world-class Athabasca basin for the nuclear fuel, but not other metals.
