One thing I always pay attention to with exploration companies is what they actually do with their money once drilling starts.
Companies can say all kinds of things about encouraging geology.
Committing more capital and adding more metres is a little different.
Stallion Uranium (TSXV: STUD, OTCQB: STLNF) is a Canadian uranium explorer focused on the Moonlite Project in Saskatchewan's southwestern Athabasca Basin. Their main target right now is Coyote, which they built up through geophysics and geological work before putting the first holes into it this year.
The original drill program was around 4,000 metres.
After getting into the first few holes, they increased the program to 5,500 metres based on what they were seeing.
The first three completed holes on the main Coyote target all showed elevated radioactivity along with alteration and structural features that you want to see when you are looking for an Athabasca uranium system.
None of that replaces assays.
Radioactivity is not the same thing as uranium grade, and alteration or structure obviously does not mean you have an economic discovery.
But I still think the decision to add metres matters.
The technical team is seeing a lot more information than the market is.
They are looking at the core as it comes out of the ground. They have the radioactivity, alteration, structures, downhole data and geophysics, and they are constantly updating their interpretation as each hole is completed.
If the first few holes were telling them the geological model was wrong and there was nothing worth following, you would think the easiest thing to do would be to finish the original program and move on.
Instead, they increased the metres.
That does not mean they have found uranium in economic grades, but it tells me the geological team still sees enough there to justify continuing to spend money.
They have also continued doing more geophysical work around the broader Coyote corridor, which is another thing I like to see. They are not treating it as a single hole or single target story.
How much weight do people here put on that kind of thing?
Do you basically ignore everything until assays come back?
Or does management putting more money behind the target give you at least some indication that the geological model is moving in the right direction?