Hawkstone Mining Share Price Up on New US Drilling (ASX:HWK)

Hawkstone Mining Share Price Up on New US Drilling (ASX:HWK)

The share price of US focused mineral exploration and developer Hawkstone Mining Ltd [ASX:HWK] are up 28.57% to 0.9 cents per share this morning.

The Perth based explorer has announced maiden drilling has begun at its Lone Pine Gold Project in Idaho.

Unlike some of the other small-cap gold explorers we discuss at The Daily Reckoning Australia, HWK’s share price does not appear to have benefited from the current gold price.

To be fair, this could be due to a disparity in activity.

Relatively speaking, Australian mining has been unphased by the coronavirus pandemic (with exception, of course).

But with operations based in the US, HWK’s share price has been depressed throughout the pandemic.

ASX HWK Share Price Chart - Hawkstone Mining

Source: Tradingview

Getting gold on the cheap

Easing lockdown restrictions in the state of Idaho has meant that HWK can finally begin its drilling program at Lone Pine.

HWK completed acquisition of the gold project in late February from US based Inception Mining, Inc for the consideration of US$510,000.

If you’re thinking that the price is a little on the cheap side you’re not alone.

It left me scratching my head too.

Lone Pine has an identified resource of 122,600 tonnes at 18.06 grams of gold per tonne (g/t) for a total of 71,128 ounces.

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That’s some pretty high-grade mineralisation.

The caveat is the mine was last in operation in 1907, and the resource estimate is non-JORC compliant and was conducted in 1935.

What does this mean?

Well, for starters it means you can’t bank on the accuracy of the resource estimate.

On the other hand, it provides a potentially lucrative target for HWK to explore.

Thankfully for HWK shareholders, this isn’t just a shot in the dark.

The Lone Pine project is located near the historic Queen of the Hills mine and the King Solomon Mine.

The area is situated on the trans-Challis fault system, a 275km long zone that has produced more gold than any other area in Idaho.

Are HWK’s prospects good?

Asides from Lone Pine, Hawkstone owns three other projects across the US.

Lone Pine and Western Desert are two gold projects, and Big Sandy and Lordsburg are lithium projects.

So, having a diversified range of assets is not usually a bad thing.

Investors seem positive about the news this morning after the company’s period of inactivity.

But with no indication of what is really in the ground at Lone Pine yet, this could all just be speculation.

Phase 1 of the drilling plans is to test the area of the historic resource, with further drill programs dependent on these results.

If you’d like to stay up to date on news from explores like Hawkstone, or if you’re just interested in Aussie miners, make sure to subscribe to The Daily Reckoning Australia, it’s a great way to stay ahead of the curve when it comes to Australian miners. It’s free too. Subscribe here.

Kind regards,

Lachlan Tierney,

For The Daily Reckoning Australia