Contango Silver & Gold to Acquire 100% of Lucky Shot Mine From Alaska Hardrock for $16.1M

Why It Matters

Full ownership removes royalty drag and streamlines the cost structure, positioning Lucky Shot for a faster path to a DSO mine and potentially higher shareholder returns.

Key Takeaways

• Contango to own 100% of Lucky Shot for $16.1 M, eliminating royalty
• Phase‑one drilling intersected bonanza‑grade veins up to 295 g/t gold
• Indicated resource now 226,963 t @ 14.5 g/t (~105,600 oz) gold
• Additional 12,000 m drilling planned to map vein continuity
• Deal includes $2 M upfront, $4.1 M cash, $10 M promissory note

Pulse Analysis

Lucky Shot, a legacy gold district north of Anchorage, has long been prized for its exceptionally rich veins that once yielded over 250,000 ounces of gold. The historic mines—Coleman, Lucky Shot, and War Baby—averaged more than an ounce of gold per tonne, a rarity in modern mining. By securing full title to the surface and subsurface assets, Contango eliminates the lingering 2% net smelter return royalty, a move that not only simplifies the project's legal framework but also improves the economics of any future direct‑shipping ore operation.

The latest underground drilling campaign underscores the project's upside. Assays from the first 40 holes revealed multiple high‑grade intercepts, notably a 1.16‑metre section grading 294.77 g/t gold in the KM vein and several other intervals exceeding 60 g/t. These results validate the continuity of the L‑vein system and introduce new targets such as the CK vein, expanding the underground footprint. With indicated resources now approaching 106,000 ounces of gold and inferred resources adding another 25,000 ounces, the data set strengthens the case for a low‑cost, high‑margin DSO mine.

Financially, the $16.1 million acquisition—structured as $2 million cash at signing, $4.1 million additional cash, and a $10 million promissory note—represents a strategic investment that aligns capital outlay with de‑risking milestones. The removal of royalty obligations and the consolidation of ownership give Contango a clearer path to a feasibility study, likely accelerating funding timelines and attracting institutional investors. In a market where high‑grade, low‑cost gold projects are scarce, Lucky Shot’s enhanced economics could position Contango as a notable mid‑tier gold producer in the near term.

Deal Summary

Contango Silver & Gold Inc. announced a purchase agreement to acquire full ownership of the Lucky Shot gold project in Alaska from Alaska Hardrock Inc. for $16.1 million, with $2 million paid at signing, $4.1 million cash, and a $10 million promissory note to be issued upon closing. The deal consolidates surface and subsurface royalty interests, enhancing the project's economics.