Tectonic Metals (TSXV: TECT) has secured C$3 million ($2.2m) to support its 2024 drilling at its Flat gold project in Alaska. The financing is led by Crescat Capital, a mining industry investor and a strategic shareholder in the company.
The financing consists of 50 million units priced at C$0.06 per unit. A majority of the units — totalling C$2.5 million in proceeds — will be freely tradeable under the listed issuer financing exemption of NI-45-106.
Tectonic Metals traded at nearly 20 times its daily average volume on Monday, and closed the session at C$0.065 apiece for a market capitalization of C$20 million ($14.6m).
“Tectonic is one of our top ten holdings in the Crescat portfolio. Our support for Tectonic and their Flat project is underscored by us doubling our ownership level to 22.3% in the company last year,” Crescat Capital chief investment officer Kevin Smith said in Monday’s press release.
Dr. Quinton Hennigh, technical director of Crescat, said that the exploration progress at the Flat gold project by Tectonic, which has only one year of drilling under its belt, has the potential to demonstrate the presence of a tier-one gold asset.
“Recent metallurgical test results indicate gold mineralization appears to be free-milling and readily amenable to low-cost heap leach processing. Such a large, metallurgically friendly deposit is highly desirable to an industry in need of such discoveries,” Dr. Hennigh noted.
The Flat gold project is located 40 km north of the giant Donlin gold project and hosts mineralization similar to that found at the Fort Knox mine operated by Kinross Gold, as well as the Eagle mine in Canada’s Yukon Territory.
The main target area at Flat is the Chicken Mountain, comprising an open-ended +100 ppb gold-in-soil anomaly extending 3,800 x 600 metres over the core of exposed intrusion. According to Tectonic, this target appears to have been the major source of placer gold in the district dating back to the early 1900s.
Before Tectonic, the project had seen sporadic exploration from the 1960s to 2003, consisting of surficial geochemical sampling, geophysics, and both reverse circulation and diamond drilling. To date, approximately 11,000 metres of drilling have been conducted on the property.
“We currently have 1.8 km of drilled mineralized strike at Chicken Mountain alone, which is one of six district-scale intrusion targets at the Flat. To date, every hole drilled at Chicken Mountain for a total of 74 holes intersected gold mineralization and roughly half of these drill holes ended in mineralization even as deep as 300-metre vertical,” Tectonic Metals CEO Tony Reda said.
The team led by Reda was the same that funded the acquisition, discovery and advancement of the Coffee gold project in the Yukon, including the completion of a bankable feasibility study, before selling the multi-million-ounce gold project to Goldcorp (now Newmont) for C$520 million in 2016.
