Battle of the Blobs - Bayhorse and Hercules in Idaho

The Bayhorse Silver (BHS.V) VTEM results are out. There is a resistivity anomaly on the Oregon side of the Snake River and a very intriguing resistivity anomaly on the Idaho side. I say intriguing because of the provisional nature of VTEM surveys. There is also a significant magnetic anomaly at the north end of the Idaho area. Potentially another Bayhorse Mine structure in a much better jurisdiction…but I am going to ignore it.

VTEM gives a very rough approximation of the rock underlying the area flown. Lovely as it would be for VTEM to provide a 100% “BINGO” it does not work that way at all. Rather it is able to provide the magnetic and resistivity “signatures” of the rocks under the area flown. From there geophysicists, geologists and mining engineers (eventually) are called in to interpret those signatures.

Along with their interpretation, surface features and samples are gathered, ideally systematically, to see what expressions the rocks may have left. Sometimes an explorer gets lucky and finds old workings, or shafts, or stockpiles which can be analysed.

But, realistically, an anomaly is just an anomaly until it has been drill tested and that is expensive.

BHS’s VTEM result on the Idaho side is a large resistivity anomaly but it is also a strong anomaly. BHS reported the minimal resistivity of the anomaly, but we know low resistance normally means high conductivity. In really simple terms, metallic rock is less resistive and more conductive than less metallic rock.

Bayhorse has staked the area covered by the VTEM and well beyond that, with operations manager John Farrell doing “billy goat” honours on a dirt bike and on foot, up and down seriously steep hillsides. He has the able guidance of BHS’s new director, Mark Abrams, who has run many exploration projects for major mining companies and has been working to ensure that Farrell’s staking efforts bring back photographs and samples.

The obvious question for investors is whether or not the Bayhorse Idaho anomaly is similar to the copper porphyry Hercules Silver (BIG.V) has discovered 45 km to the north east at another suture of the Izee and Olds Ferry terranes.

Here’s what BIG’s IP anomaly looks like from a December 15, 2022 news release:

One and a half kilometres long, 150 to 300 meters thick and starting about 200 meters from surface.

On the right of the figure below is the Idaho resistivity anomaly for Bayhorse, (note, scale is very different).

Bayhorse estimates that this anomaly begins 100 meters from surface and extends down 425 meters. Bayhorse believes that the anomaly is circular with a diameter of 0.76 – 1.2 kilometres. This would mean the Bayhorse Idaho anomaly may be substantially bigger by volume than the Hercules anomaly. Much bigger.

From a mining perspective, size is important, but so is geometry. The Hercules deposit is best described as “horizontal”. Which is fine, but it means that overburden would have to be cleared if an open pit mine were to be constructed. That overburden looks to be 100-300 meters. And that overburden would have to be cleared all along the 1.5km to get to what is at this time, at most, 300 meters of mineralized rock. Which is a lot, but it is a bit of a mining nightmare.

The Bayhorse Idaho anomaly is more “up and down”, vertical in other words, with an estimated depth of 425 meters beginning 100 meters from surface. Prima facie this looks like a more economical pit structure. (Actual mining engineers will be looking hard and translating the anomaly, as it emerges, into a pit shell and doing the economics from there. Strip ratios and all that.)

And now we arrive at the, literally, billion dollar question: what’s the grade?

Hercules took off October 10, 2023 when it announced the results of its first “deep” hold which drilled into the “blind” copper porphyry. Its shares which had been trading at around $0.20 shot up and touched a high of $1.62 a month later. Barrick arrived with 23 million to finance exploration and enter a strategic partnership. The headline numbers for this hole were, “185 Meters of 0.84% Cu, 111 ppm Mo and 2.6 g/t Ag, including 45 Meters of 1.94% Cu” which are outstanding for a copper project.

It was a huge discovery for BIG and the market went into a bit of frenzy. But the market sobered up a bit when it realized the mineralization began 246 meters down. Good results from step-out holes were still at depths greater than 200 meters. That is a lot of overburden along a 1.5km strike.

Bayhorse has not begun to drill yet. There are encouraging signs of copper staining at surface in the staked area and we’ll see how the samples our billy goats have collected assay. But shipping a drill across the Snake and up to a drilling pad will be essential. The good news is that, with the anomaly close to surface, it should not take all that long to have some preliminary results. The very good news is Idaho is one of the most exploration and mining friendly jurisdictions in the US so permitting should be smooth sailing.

Were I BHS CEO Graeme O’Neill, I would move Heaven and Earth to permit and reconnaissance drill the resistivity anomaly in the southeast corner of the VTEM survey. Initially, short holes, 300 meters to see if there is decent grade near surface. Drill right for the near purple on the VTEM.

A decent hit, with decent grades, and BHS is over $1.00 and the big companies will be eager to fund “Bayhorse Idaho Copper”.

This may be a lot bigger than BIG.V

(Notes:

1. I have largely ignored the resistivity anomaly BHS has found on the Oregon side. It might be a feeder for the Bayhorse mine and it is certainly good to see, but because it is in Oregon, permitting issues will likely make it undrillable for the foreseeable future. It may go right to the bottom of the Bayhorse Mine which would be very interesting. It gives the BHS geos valuable information and suggests structure, but it is likely to have a minimal impact on the share price. It does, however, tend to confirm the Izee terrane structure’s ability to host mineralization.

2. Hercules (BIG.V) put out a press release today, Feb 28, 2024, disclosing significant silver drill intercepts at its Western Idaho property. I want to read that release more carefully before commenting but it is another confirmation of the style of mineralization to be found at the suture of the Izee and Old Ferry terranes.

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[Disclosure: Graeme O’Neill is a friend. I own shares in Bayhorse Silver (BHS.V), a lot of shares, and may buy more or sell some or all at any time. I also have a small position in Hercules Silver (BIG.V)This is not investment advice. Do your own due diligence. ]