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Friday, August 31, 2018

Sokoman - thar be gold en those swamps

Sokoman have been releasing some interesting results from their Moosehead project (link and link) , the first set released in July managed to catch some money from Eric Sprott (link), but the good news is, he's still in the money.

However, whne you look at the data, you will notice:

  1. There has been a crap load (~113 holes) of drilling on this project
    • 7 holes by Teck in 1999
    • 91 holes by Agnico from 2001 to 2004
    • At least 15 holes by Sokoman
  2. Virtually all of Sokoman's holes are exploring the West Trend, the area that didn't give us the thick high-grade intercept that send the share price soaring.

lots and lots of drilling, not all of it new..

So 12 of the 13 holes on this map (holes 14 and 15 aren't shown on the map accompanying the PR  for some reason), are exploring the very well drilled West Trend, and just one, little, lonely hole, MH-18-01 has been drilled to explore the East Trend.

I've tried to compile as much information as possible into Leapfrog Geo, and here is my pathetic attempt here (link). Please note that it is quite low quality, I had to guess the dip of the drill-holes (I assumed -60 for historic holes and -45 for the 2018 DH, unless there was evidence on plan maps and sections) and their hole lengths. So it is inaccurate, but gives a general feel.

So, by far, hole MH-18-01 has easily been best hole drilled this year, and one of the best intercepts on the project, but why haven't there been more holes drilled around it? If the hole naming convention is logical, it was the first hole drill on the property, hit a high-grade structure and since then, Sokoman haven't drilled a single hole around it to see what it is doing. Instead, they drilling lots of holes into an area that has received considerable drilling before. Why?

  1. All of the historic core as been lost and they are doing confirmation drilling?
  2. Don't want to ruin a good story with the truth machine? 

I'm going to give the the benefit of the doubt, in none of the presentations (including several from Altius) do they show any pictures of old core, so we have to assume that it doesn't exist.

I've tried to compile as much data as I can from the various presentations. We can see that the West Trend is very well drilled (even before the recent drilling) and most of the although high-grade and generally very narrow, and furthermore, most of the high-grade intercepts have had a plethora of holes drilled around them to see what the mineralization is doing. As we haven't been given any assays form these holes, I'm going to assume that they didn't hit anything good (i.e. >1 g/t Au).

Here is hole  MH-18-01, a wide bonanza zone, here is a photo:

(Hard)core porn
And an annotated version:



Oh no, virtually all of the gold is restricted to that quartzy-veiny bit (the white stuff) in the middle, with the surrounding boring grey rock rock with just a smidge of gold. So a big round of applause to Sokoman for that lovely example of grade smearing, however they could have done:

  • 385.85m grading 1.35 g/t Au

I know the hole only went to 250m, but you can't BS-stats.

Why don’t we look at the other intercepts? Please note, I don’t have any info for the pre-2018 drilling, so the section shows approximately where the holes were drilled, but no results.

Section 1: Holes MH-18-02, 03, 12 and 09 (looking East – North to the left)



We see narrow high-grade mineralization, with a minor >1 g/t Au halo. It was a shame that hole 09 was lost before reaching target depth as these holes appear to have defined a gold zone over for 60m down dip. Nothing out of this world, but does show a narrow gold bearing structure with local high-grade mineralization.

Section 02: Holes MH-08, 10 and 13



Similar story, narrow high-grade with a minor ~1 g/t Au halo.

Section 03: Historical drilling


Some very high-grade hits (>400 g/t Au), but again very narrow, and it look like (even though I don’t have the data), that the follow-up holes were not able to find the continuation of mineralization. For me, the data is telling us that at Moosehead, the gold is restricted to narrow, 0.1-1.5m wide quartz veins with a minor Au halo. Unless the ‘new discover’ zone is very different, the mineralization looks too narrow and inconsistent to suggest that there is a large, high-grade deposit to be found at Moosehead.

The fact that >100 holes have been drilled on the project without defining any resources or discovering any zones of consistent mineralization indicates that they probably don’t exist.  My gut feel is that the mineralization in the East and West zones consist of narrow high-grade intervals that will be smeared out in the PRs to make them look wider and better than what they really are.
For Sokoman to make a go of it, they need to drill some more holes in the East Zone to follow-up on hole MH-18-01 and start drilling some of the other structures/anomalies so that they can keep the market happy with new discoveries.


15 comments:

  1. Grade smearing may work to impress at the retail investor level, but will never get past the institutional side, and this is why the stock price will never hold up for long after the analysts take a closer look at things.....Companies intentionally grade smear to invoke hype to take advantage of stock price spikes for financings, but the truth always comes out in the end......Angry Geologist is needed in this sector

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    Replies
    1. A lot of the time it impresses other geologist as well. Even though there are tools to check the strength of the BS in the results, most don't

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  2. Chart is speaking loudly on SIC.v rubbish ... http://pennystockjournal.blogspot.com/2018/08/sokoman-iron-corp-sicv.html

    There's fire at Golden Ridge Resources Ltd. - GLDN.v lately.
    http://pennystockjournal.blogspot.com/2018/08/golden-ridge-resources-ltd-gldnv.html

    Lastly I'm gonna respew about Great Bear. Superior heads up from a reader here, it's one to watch.
    http://pennystockjournal.blogspot.com/2018/08/great-bear-resources-ltd-gbrv.html

    ReplyDelete
  3. The original drill plan was 1 drill hole in the discovery hole area, then the remaining holes in the Western Trend. That was the plan and they stuck to it. No need to push conspiracy theories. The 10K drill program truth machine for the new discovery area will begin next month.

    The old drill core does exist at the provincial government storage facility. Tim Froude was examining it a few weeks ago. See Sokoman’s twitter account.

    ReplyDelete
    Replies
    1. If you look at the presentation, slide 15, you can see that the Sokomon geologists have drawn nice red circles around all of the visible gold. So they knew this interval contained lots of VG and therefore was likely to be high-grade.

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  4. I don’t understand the issue. Imagine you’re a geologist for the company that drilled MH-18-01. Would you advise the company to follow up on that interesting drill hole? Or would you advise them to give it up? I assume the former, right?

    So that’s what Sokoman’s going to do. They got $3 million from Eric Sprott and friends and they are planning a 10K drill program to follow up on the hole.

    What exactly is the problem with that? Are you just angry because Sokoman attracted a little too attention from idiot retail investors? What do you care? It’s not your money.

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  5. The issue is that most explorationists, when faced with a new discovery hole in an area that hasn't had the crap drilled out of it would immediately recommend cancelling the existing drilling program and refocusing on the new discovery. The fact that Sokoman plowed ahead with a largely pointless program anyway raises questions about the company that potential investors should be wary of - that's the entire point of this blog, right?

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  6. Did Sokoman have the assays for the discovery hole before the rest of the Western Trend holes were drilled? No. Even if Sokoman wanted to pivot and change the drill program based on visible gold in the discovery hole would they have had the cash? Not enough to drill 10K meters. Is the data from the assays for the discovery hole and the follow-up downhole televiewer survey important for planning that 10K meter follow-up program? YES.

    ReplyDelete
    Replies
    1. It appears thatthey had the assays for the high grade part of the structure, as on page 16 of their presentation you can see that this is the only part that has been cut. The surrounding rock (which was part of the 11.9m @ 45 g/t Au) has been marked up for sampling (the sample numbers are written on the core) but not yet cut and send for analysis.

      This means that they went back later (2-3 week later) and sampled around the high-grade quartz vein/structure to see if there was a mineralized halo around it.

      If they had time to do that, you would have thought that they would have put a hole or two around it to see where it goes, even if they were at the end of the program.

      Delete
    2. They were out of cash to “put a hole or two” by that point. Sokoman was a micro-junior with a C$1 million market cap. You can’t expect much when there’s no cash. They were right to raise the C$3 million from Eric Sprott and take the time to design a proper, well-funded 10K meter truth machine.

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  7. Hindsight bias: you say drilling the Western Trend was largely pointless because you don’t like the assay results. Before the discovery hole hit I’m sure you would have said drilling Moosehead at all was largely pointless (because of all the previous drill holes).

    ReplyDelete
    Replies
    1. No, my thought would be, if you had a limited budget, I would have put a few holes to explore some of the other targets/high-grade surface samples as the west zone appears to be very well drilled and therefore would be a hard story to promote. However, if they had found 2-3 new gold occurrences, then it would increase the potential of the project.

      Going back to the West trend and essentially repeating the historic work, especially as the old core exists (or at least part of it), unless they were testing a new concept, is a little redundant. I have no issues with 4-5 holes in this area as a proof of concept and from the promotional angle, guaranteeing some 'results' for press releases, but if they hadn't of hit the new zone in the each trend, then what story are they promoting? We have some great results which were from the same area that was drilled previously.

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    2. The new concept was that the original holes in the Western Trend were drilled with the wrong orientation. That was the conclusion of a structural study by a consultant. I’m not saying it was a good idea, but that was their approach. They were not just confirming historical drilling.

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    3. I'm not sure I agree with that. There have been holes drilled in multiple directions in the Western Trend, including parallel to the 2018 drilling.

      I can understand 4-5 holes maybe, but not 14, especially as they could have (unless permitting was an issue) drilled a couple of holes to the north (slide 17) where Altius got that very high-grade float samples.

      However, they now have money, it will be interesting to see the results. However, I think that all we'll see is a few irregular narrow high-grade zones that won't join up to make a resource.

      Delete