Stonecap - More High Grade From The South East

Probe released assay results for 52 drill holes from its flagship Borden Gold Project in Ontario. Highlights include:

Higher grade zone – To test the new higher-grade zone, four holes were drilled on section 1150 m SE (Figure 1). Highlights include drill hole BL13-359, which intercepted 26.7 m grading 3.2 g/t gold (starting 335.5 m down-hole) and drill hole BL13-362 which intercepted 42.9 m grading 3.4 g/t gold.

Infill drilling – a further 45 drill holes were released which continue to add confidence to the main zone.

Significant intercepts include: 53.7 m grading 1.6 g/t gold, starting 125.3 m down-hole (drill hole BL12-327) and 36.5 m grading 4.5 g/t gold, including 1 m grading 102 g/t gold, starting 249.5 m down-hole (drill hole BL13-358).

Hanging wall drilling – Two holes were drilled in the hanging wall with both returning narrow intercepts,

7 m grading 1.3 g/t gold and 3.5 m grading 1.4 g/t gold.

Depth Extension Drilling – Drill hole BL12-316 targeted extending the deposit to depth and returned 4.7 m grading 4.4 g/t gold (starting 355.3 m down-hole) and 29 m grading 0.7 g/t gold (starting 383 m down-hole).

Valuation

Our adjusted net asset valuation of $3.74 is based on our DCF analysis of Borden Lake with a 0.45x multiple to get to our rounded target price of $3.75 per share.

Conclusion

Drilling results continue to highlight the higher-grade portion of the deposit to the south-east. Probe remains well funded to pursue its exploration plans and a major catalyst in the form of a PEA is expected this quarter, which is expected to further de-risk the Borden Gold project. We are maintaining our Outperform rating and $3.75 price target.