North Peak Resources: Gold Drilling Towards a Resource Estimate at Prospect Mountain Project

Key Concepts

• Prospect Mountain Property: The primary asset of North Peak Resources, a historical high-grade gold camp with no modern exploration for 40 years.
• Oxide Material: Near-surface, open-pittable gold mineralization.
• Dean Cave: An area within the Prospect Mountain property where high-grade gold and silver grab samples have been found underground.
• Sulfide Anomaly: A large, deep geophysical anomaly indicating potential for a significant gold deposit.
• CRD (Carbonate Replacement Deposit): A type of mineral deposit characterized by replacement of carbonate rocks, often associated with base metals and precious metals.
• Open Pit Mining: A surface mining technique where material is extracted from an open pit.
• Underground Mining: Extraction of minerals from beneath the surface through shafts and tunnels.
• Resource Estimate: A calculation of the quantity and grade of mineralized material in a deposit.
• Dilution: The reduction in the average grade of ore due to the inclusion of waste rock during mining.
• Cash Flow: The net amount of cash and cash-equivalents being transferred into and out of a company.

Prospect Mountain Property: A Historical Gem with Modern Potential

Rupert Williams, CEO of North Peak Resources, discusses the company's acquisition and exploration of the Prospect Mountain property. This historical gold camp, mined sporadically from 1880 to 1970, has not undergone modern exploration for the past 40 years and has missed out on the last two gold bull markets. The property was acquired from the Erickson family, who approached North Peak's chairman, Harry Dobson, due to his past success with Kirk and Lake Gold. North Peak has spent two years evaluating the property, conducting soil sampling, and drilling. A significant MT (Magnetotelluric) survey revealed a large anomaly beneath the old workings, below the water table, which the company is excited about. Drilling in the northern part of the property has identified near-surface oxide material, believed to be open-pittable. These initial results have given North Peak the confidence to secure a 100% interest in the property, which they did in July, and are now actively promoting the stock.

Exploration Strategy: A Three-Pronged Approach

North Peak's exploration strategy is divided into three main areas:

1. Near-Surface Oxide Material:

   • Objective: To identify and delineate open-pittable oxide deposits.
   • Details: The company anticipates three to four small open pits, each potentially hosting 300,000 to 400,000 ounces of gold, totaling an estimated 1 to 1.5 million ounces.
   • Progress: Significant progress has been made on one pit, named Williams Bash, which has yielded high-grade drill results, including 24 meters grading 12 grams per tonne (g/t) gold, with a 3-meter interval of 86 g/t gold. A 126-meter intersection grading 1 g/t gold indicates a halo of mineralization around high-grade pods, making it amenable to open-pit mining. The estimated grade for this area is 1.5 to 2 g/t gold, though further work is required for a resource estimate.

2. Oxides Down to the Water Table (Dean Cave Area):

   • Objective: To add high-grade ounces quickly by exploring the oxide mineralization below the historical workings, down to the water table.
   • Details: Recent grab samples from this area, collected by geologists from underground, have returned exceptional grades: one sample assayed 180 g/t gold and nearly 1,000 g/t silver, and another yielded 66 g/t gold and 370 g/t silver.
   • Progress: Drilling is currently underway in this area, targeting the mineralization. Historical mining records indicate that miners were extracting material grading up to 3 ounces per ton (approximately 85 g/t gold), and then simply stopped. This suggests significant high-grade potential.

3. Sulfide Anomaly:

   • Objective: To drill into a large, deep geophysical anomaly identified by an MT survey.
   • Details: One drill hole has been completed into the anomaly from 1,000 meters below surface. This was a challenging drill program due to the old workings, water ingress, and drill bit issues. The hole confirmed the presence of mineralized sulfides, primarily silver and zinc, with very high-grade zinc (10%). Sampling across the top of the mountain indicates a transition from silver-zinc to lead-gold mineralization.
   • Future Plans: North Peak plans to utilize its 11 miles of existing underground tunnels and shafts to drill 1- to 200-meter holes from underground. This will allow for year-round drilling and is expected to target a deposit potentially hosting 3 to 4 million ounces of gold.

Production Potential and Financial Strategy

While the primary focus is on exploration and discovery, North Peak Resources is also considering the potential for production. Rupert Williams draws a parallel to Harry Dobson's previous success with Rupert Resources in Finland, which hosts a 4-million-ounce deposit and has a market capitalization of $1.4 billion. North Peak is prepared to put its discoveries into production if necessary, but is also open to a takeover.

A key aspect of their production strategy involves a waste pile on the North Peak property. Initial estimates suggest this pile contains 220,000 tons of material grading between 0.5 g/t and 1 g/t gold. The company is exploring the possibility of processing this material using a vacant heap leach pad owned by a neighbor. Preliminary leaching tests are required, but the company believes this could generate $15 to $20 million in positive cash flow, reducing the need for future market financings. Williams emphasizes that this is a "side note" to the main discovery story.

Metallurgical Considerations and Timeline

Regarding metallurgical tests, North Peak has not yet conducted any. However, they understand that the sulfide deposit beneath the water table is a Carbonate Replacement Deposit (CRD), which is typically not refractory. This is a positive indicator, as refractory ores can be costly and difficult to process. The company acknowledges that they are a long way from production for this deeper sulfide mineralization, with significant drilling still required.

First Resource Estimate: Williams anticipates a first resource estimate for the open-pit oxide material within the next nine months, likely by summer of next year. This will provide an initial indication of the size and potential of the open-pit deposits.

Future Outlook and Key Targets for Next Year

North Peak Resources aims to avoid dilution, as the top 10 shareholders collectively own 70% of the company. While cash flow is beneficial, it is not the primary driver.

Most Important Targets for Next Year:

• Drill Results: To achieve more positive drill results around the open pit area and in the oxide zones down to the water table.
• Underground Access: To rehabilitate existing underground drifts to enable drilling into the sulfide anomaly from underground.
• High-Grade Intersections: To see more high-grade intersections from the oxide mineralization.

The interview concludes with an optimistic outlook, with the interviewer encouraging North Peak to "let the drills turn" and expressing confidence in the team's ability to replicate past successes, potentially making 2026 a significant year for the company, especially with the anticipated resource estimate by summer.