In late-August 2020 A news release from a company that I barely knew existed at the time caught my attention. On August 24th, 2020 Bitterroot Resources (TSX-V:BTT, OTC:BITTF) had released the results of the first four holes into its 'LM Target' in Michigan's Upper Peninsula, roughly 25 kilometers from Lundin Mining's Eagle Mine (high-grade conduit hosted copper-nickel-PGMs magmatic sulphides). Hole #1 intersection of roughly 5 meters of disseminated sulphides was intriguing because of the location of this new greenfield target, and the region's propensity for hosting such ultra-high grade pools of massive sulphides (similar to Lundin's Eagle/Eagle East, and Talon Metal's Tamarack Deposit in nearby Minnesota). Over the next several months I learned more and more about Bitterroot and proceeded to participate in the private placement at the end of 2020 that helped to fund the year-to-date drilling at LM in 2021. 

I still hold those placement shares/warrants sitting untouched. In fact, I own more BTT shares than ever. The share price has seen a rollercoaster ride from $.065 exactly one year ago, to a $.25 peak back in February,  and then to a recent low of $.055:

BTT.V (Daily)

I recently had the opportunity to have a 45 minute conversation on a Friday afternoon with the CEO of Bitterroot Resources, Michael Carr. What follows is the transcript of the conversation along with some graphics added by myself to help readers better visualize some of what is discussed. 

Goldfinger: Good afternoon Mike, it’s great to speak with you today. Let's get right, the first question that I'd like to ask is, why this project? How did you come across it? And why did you decide to drill it beginning in 2020?

Mike Carr: It started back in 2013. I was on a field trip and talking with a geologist that had drilled about 25 holes in the mid-late 2000’s in the immediate area of what we now call the LM Property. He still liked the area and the untested LM target. Rio Tinto (previously known as Kennecott) had drilled LM (one shallow hole) in 1995 and dropped their lease during a budget cut back period, which lasted until roughly 2001.The 1995 Rio Tinto hole confirmed LM was prospective for Eagle-type conduit-hosted mineralization. Meanwhile, Rio discovered Eagle in 2002 and LM had been leased by another junior explorco who ultimately never drilled it. I acquired the lease from that junior explorco in 2014, after a management change. 

The LM target was still pretty valid for conduit hosted Eagle-type high grade magmatic nickel-copper sulfide. We knew it was the right geology, so it was a low cost, potentially high impact target that was worth testing. I acquired the ground in 2014 and immediately I got to work on acquiring surface access rights for drilling. And then in the ensuing years, it became very difficult to finance nickel exploration. In the last year and a half, certainly things have changed with the battery metals becoming more top of mind for people. So financing nickel exploration now is not as difficult as it was in that period, up until about late 2019.

Goldfinger: I think that it is really important for people to realize that there are times that last for years in the sector where nobody wants to write a check for certain kinds of exploration programs for various metals. And obviously, nickel and base metals in general, went through a pretty rough stretch from 2013 to last year. It was pretty much an eight-year bear market period. So the timing of picking up this property was excellent. And tell us a little bit about this area of Michigan and sort of the bigger picture or why it's so interesting for these sorts of conduit-hosted massive sulfide deposits?

Mike Carr: Lundin Mining’s Eagle Mine is only 25 kilometers east of where we're working at LM, in the same type of rocks. Mafic/ultramafic intrusions in Paleoproterozoic metasediments with sulfides in the sediments, plus sulfides in the Archean basement. It's a piece of the Superior Province that has been affected by a later event called the Midcontinent rifting event, which has been noted as being similar to what happened at Noril’sk, Russia, which hosts the world's largest magmatic nickel-copper-platinum-palladium deposits. 

The Eagle discovery hole was drilled by Rio in 2002, but the target had been identified as far back as 1979, by government geologists, as having good potential. There was an outcrop with net-textured sulfide at surface. It was all pyrrhotite, but there it was, magmatic sulphides in a peridotite outcrop. So you had the goods right there on surface in an obscure little outcrop on the side of a creek back in the woods., A very obvious drill target and Rio Tinto’s geologists recognized it and secured funding to drill it. 

Massive sulfides in gravel pit one mile east of BTT's LM Property found by Rio Tinto geologists in the 1990s

Rio came to the general area initially looking for zinc in the Baraga Basin in the early 90’s because the shales are very zinc-rich, but shifted focus to nickel and copper after discovering nickel-copper-mineralized boulders in a gravel pit, coincidentally, only about a mile east of LM. And they were the first people to drill that area over what is now the Eagle Mine, starting in 1995. That was 16 years after the government published a report identifying the potential there. So it was... I wouldn't say a no brainer, but I think most explorers would've gladly set up a drill and drilled underneath that outcrop with the net-textured magmatic sulfides. Kudos to one Rio Tinto geologist in particular, who insisted they keep the leases over the Eagle targets between 1996-2001, when Rio’s budgets were lean. And low and behold, they had, I think, 85 meters of massive sulfides in the discovery hole drilled in 2002. After Rio discovered it and Lundin started mining Eagle, drilling resumed at Eagle East, following that conduit down-plunge 800 or 900 meters to the high-grade ore body there. Whereas at Eagle it's at a depth of only 50 to 300 meters.

Long section showing Lundin Mining's Eagle and Eagle East Deposits 

Around 2006, Rio did some drilling in the area where we're working at LM, which is also referred to as the Roland Lake area, with some success, but no discovery hole. Rio pulled out of Michigan after they sold Eagle to Lundin Mining in 2013. There was no more exploration done in the district for several years. 

Our current drilling at LM is funded 51% by Bitterroot and 49% by Below Exploration Inc., a private group who stepped up to finance LM drilling in mid-2020. Bitterroot is also a large landowner farther West. We have 250 square miles of mineral rights, called the Voyageur Lands, which are now subject to a joint venture with Altius Minerals. They own 50.1%. We own 49.9%. Altius funded a VTEM survey in late 2015, which turned up nine high-priority magnetic + EM targets and some startlingly prospective geology, all of which remains untested by drilling. We plan to advance that also, subject to discussions with Altius.  

So what you've got in the Upper Peninsula of Michigan is a district where Bitterroot has a lot of experience, which also has a lot of potential to host more of these high grade Eagle type deposits. The district has seen very little exploration, in the grand scheme of things. There are very few players in the game right now. We're the only people that have drilled any holes for nickel-copper in the Upper Peninsula of Michigan since Rio Tinto left, except for Lundin Eagle Mine, who drilled just three holes, before head office decided that they didn't want to pursue exploration in Michigan anymore. And I'll just point out that in the latest Lundin Mining financial statements, the Eagle mine is performing absolutely magnificently. It's production costs are negative $1 per pound of nickel after copper credits. So in other words it's a highly profitable operation for them.

Goldfinger: So we're in an area of the world where it makes a lot of sense that there's more of these deposits like Eagle and Eagle East to be found. As a junior mining investor, who's flipped through thousands of presentations and reviewed hundreds of different companies and management teams. This project, and the entire area, really attracted me in terms of the potential. And of course I realized it wasn't going to be easy because with diamond drilling, you're essentially trying to find a needle and a haystack, sometimes with these things.

So the ore bodies can be 100 meters by 200 or 250 meters, and 40 or 50 meters thick, but they can be extremely high grade with a high specific gravity of 4.5 to 5. So you can pack a lot of metals like copper and nickel, platinum, gold, etc. in a pretty small orebody just like exists at Eagle and Eagle East. Using those as the analogs for what we're trying to find, it's pretty unlikely you're going to hit the meat of the ore body in the first dozen or a couple dozen holes. So we're 21 holes into it at the LM project. Can you tell us what you've learned so far?

Mike Carr: The surface expression of the LM target is a bullseye magnetic high. And we've focused our initial drilling on that area. We didn't really know what shape it was initially, and now we've defined it pretty much as a sub-vertical pipe. All of our mineralization is occurring at about 260 meters depth in an area where the bottom of that pipe, all of a sudden is horizontal or sub horizontal. So it's not a pipe that goes straight down forever. It's a pipe that goes down almost vertically, not quite for 250 meters, and the then it turns, there's an elbow there. And the challenge has been to determine where it goes sub-horizontally and therefore where the massive sulphides have accumulated...  just like at Eagle East.

3D image of drilling to date at BTT's LM Property in Michigan, USA

It has been a challenge to take that to the next level. Geophysics are of limited use at those depths because the responses are ambiguous. They can be interpreted multiple ways and somewhat overshadowed by the more near-surface responses. That's in the ground magnetics and time-domain borehole EM. We did some borehole EM, in the first hole and defined a conductor right around the elevation of our mineralization. But unfortunately that looks like it's Graphite and sulphide-rich sediments. So very black shales loaded with graphite, which is very conductive. And there's also pyrrhotite sulfide beds within them. Pyrrhotite occurs with the nickel-copper mineralization, but it also occurs in the host sediments and it's magnetic and conductive as well. So you've got a challenging geophysical environment to work with. It's required a little more drilling than I thought we would need. And we're continuing to define the shape of the intrusion and looking for that larger pool of sulfides at depth.

Goldfinger: So trying to wrap my brain around this, there have been five holes that have intersected semi-massive or massive sulfides of some width, including hole 21-07. Which probably was the best intercept with nearly a meter of semi-massive sulfides grading, 5% nickel and 1.2% copper with some gold and platinum thrown in there as well. It was a very high tenor hit there, including a rip-up clast, that was probably about the size of my hand, massive sulfides that carried grades of almost 8% copper and 7% nickel with some platinum and gold thrown in. 

Massive Sulphides from Hole 21-07 at LM 

Just incredible grades, but obviously very narrow. So when you see something like that at that elevation that you're talking about, where clearly there is an envelope of sulfides there, we just don't know how it extends and exactly what the shape is. Where did that come from? What is the next step to figure out where those sulfides that contain all this nickel, copper, gold and platinum came from? And what is the drilling so far telling us about where it came from?

Mike Carr: The orientation of the intrusion and its keel at depth is really the key question that we've been trying to solve with our drilling. Our sulfide rich, mineralized intervals are all in the Southeast quadrant of the pipe. However, you have to remember that the sulfides are settling out into the bottom, or the keel, of the intrusion. So if you've got a conduit that's pumping magma with sulfides entrained in it, sulphide droplets are floating around in there, but they're denser than everything else, but they're still being pulled along by the momentum of the magma moving up. Eventually they're going to settle out just like heavy minerals in a stream bed or placer gold. So the orientation of the sulfides is likely a little bit different than the host intrusion. We've basically moved around the perimeter of this pipe- shaped intrusion, looking for where it goes laterally at about 250-300 meters depth. There are still gaps between our holes.

We're looking for the well-mineralized keel. We've got some ideas for additional targeting techniques. We're still processing our data and looking at 3D models and whatnot, and trying to figure out where this thing may go. And beneath the mineralization we have hit so far, we've probably got at least 500 meters of room below us down to the Archean basement to follow this conduit. So there's still plenty of potential. The challenge is to determine the orientation and that's what we've been trying to do with drilling.

View looking down from 200 meters depth at LM

Goldfinger: Like you said, there's still plenty of room below. 500 meters of depth to the basement rocks. If you think about a core drill and I'm not sure exactly the size that you're using, but let's just say for example purposes, the diameter is 5 centimeters (2 inches) or something like that. And you're trying to hit this ore body with this relatively small surface area of the drill. Unless you hit it pretty much right on, you clip bits and pieces of it, you get the toenail, you get the finger, but you're not in the body of it until you are. And it's an iterative process where you're basically prospecting with a drill.

And as you said, the magnetics and EM (electromagnetics) is only helpful so much and there's no magic formula to find these things. If we think about Talon Metal and Rio Tinto's Tamarack deposit in the neighboring state, which has millions of tons of really high-grade massive sulfides, copper-nickel, platinum, massive sulfides. Their discovery hole was the 42nd hole into the deposit, which wasn't a deposit yet, it was a target. So it was a 42nd hole into it. And then they hit a hundred plus meters of semi-massive to massive sulfides.

And with Eagle, I think they hit it on the 10th or 12th hole. With Eagle East, it took a lot more drilling. I'm not sure the exact number of holes, but it was more than 40 because they had to follow it down to depth at many hundred meters. I think it's 900 meters depth. So you just don't know until you know. But if we're seeing the prize, the potential prize as something like an Eagle East or an Eagle or a Tamarack, or even something half as good as those deposits, the prize is very valuable. The prize is extremely valuable. Especially in this environment that we face in the world with battery metals in need across the world. And Tesla's just going to new all-time highs almost every day. And they're consuming a lot of nickel and copper cobalt, a lot of metals in their vehicles and they're just one company, right?

And China's got their own battery metal... Their own electric vehicle manufacturers, etc. So copper, nickel, cobalt, all these battery metals, we're going to need a lot more of them. A lot more of them for many years to come. Bitterroot is conducting real greenfield exploration in a highly underexplored area of the US to find a big domestic source of those battery metals in a safe jurisdiction in a great location for mining,  where there are already existing mines that are similar in size/scale and extraction method to what would likely occur at LM. And so we've made progress, but we haven't found the belly of the beast yet. So what's next, Mike? And how do we do a better job with drilling and making sure the drill goes to where we want it to go?

Mike Carr: The drilling has been challenging, no doubt. We've had equipment issues, we've had crew issues. I would say certainly the crewing issues have been common throughout the industry. Eric Coffin was telling me, he's hearing the same thing from many different companies that good drill crews are very hard to find right now. But we don't have any other alternative. If you're trying to drill core holes your choices of contractors are somewhat limited and drill rig availability is a challenge. So we just try and keep the good guys working and make sure the guys that are less to our liking move on. In terms of equipment, we've had some breakdowns, no doubt. Our equipment availability's been less than I would like. I think we've got that partially solved for our next phase.

We actually have two drill rigs on the property right now. And one of them had a major mechanical failure in a hydraulic ram that was difficult to repair. It's not something you can just get fixed in a few days. So that forced us to go to plan B, which was to use a rig that was not in as good a shape as we thought it was going to be, but we muddled through. Bottom line is we've got to keep drilling. 

Obviously our productivity could be a lot better, but the absolute dollar burn rate hasn't been too terribly bad. There's lots of room to do better and we are focused on increasing drill productivity when we return in the new year.  And we're also looking at potentially doing other types of geophysical surveys to help us see a little deeper into the system.  Since it is currently hunting season, followed by Christmas, we've got some time to do some work, interpreting our existing data, perhaps gathering new data to guide drilling, which I hope will go a little more smoothly in the new year.

Goldfinger: All right. Final question, actually it's a two-part question. Hole 21 was targeting the Southeast quadrant and as you noted in the news release this week, it did not hit the target. It was a little high and right, as you described. Will that be the first hole in 2022? Will it go to that target that you attempted to drill in hole 21? And then the second part of the question in your slide deck, slide 17 I think, you're showing the 600-meter magmatic conduit target, and then you're showing another two circular targets to the South. Are those going to be drilled in 2022? It seems all indications are to go South. Is that still what you see?

LM Conduit Magnetic Footprints 

Mike Carr: Getting back to the first part of your question... Yes. I would go back to where we were just drilling from and drill another hole into the intrusion. Hole 21 deviated significantly in the first 100 feet, mainly in the overburden, which the drillers had some difficulty getting through. That’s a crew experience issue which we expect will be solved going forward. We did hit the base of the intrusion in the general vicinity of where we were aiming, but we exited the intrusion at about five meters higher elevation and further north than we expected to.

I would definitely go back and drill another hole between holes 7 and 21, because hole 7 had a nice 0.75-metre-thick massive sulfide intersection grading roughly 5% nickel. That's a good starting place. Regarding the 600- meter long conduit target, that is a target that still needs to be tested and those two satellite magnetic highs to the South also need to be tested. The land acquisition process has been going on much longer than I expected it to. There was a minerals reservation made over 100 years ago by an individual. And that's really the last time anybody claimed those mineral rights. So based on the way the mineral tenure system works on private minerals in Michigan, that person’s heirs have the best claim to those minerals. We've been working on a deal. So at some point, those things on private land to the south deserve to be drilled and we'll find out whether or not they're what we think they are or might be. But remember, our strategy has been generally to stick close to the high-grade mineralization we have hit at LM to date, and try and determine what direction it's heading in. Rather than doing larger, higher-risk step outs, which are worth doing, but perhaps not quite yet.

Goldfinger: A lot more to be unveiled in 2022. You guys will be back on the ground in the new year. Probably resuming drilling by the end of January, hopefully. You have the cash to continue to drill. and the drilling costs are not terribly high. And quite frankly I started following the BTT story, or at least this version of it, in Michigan in August 2020. The share price was about five and a half cents at the time. That was my first purchase, $.055 and I've bought shares all the way as high as $.18, and I still hold more shares than I've ever owned in the company at this point in time. And I'm not planning to sell anytime soon. I want to see this thing through. I think it's got a lot of potential and there are other projects in Michigan and Nevada that we didn't have time to discuss today, a lot of potential value can be unlocked for shareholders in the future. 

The discovery hole at the Rio/Talon Tamarack Nickel project in Minnesota was the 42nd hole into the target and it intersected 138.4 meters averaging 1.61% nickel, 1.08% copper, and .54 g/t PGMs

And as Eric Coffin says, "It's got a huge amount of torque to a new discovery." Which basically means, if the drill hits anything close to a Tamarack discovery hole (Talon Metals has a C$450 million market cap and owns 60% of the Tamarck Project) or an Eagle discovery hole (The Eagle/Eagle East Mines are Lundin Mining's most profitable operations as of most recent financials), we're talking about a very, very large potential upside. I'll leave that to your imagination. But at the current market cap, $C6 million based on a $.075 share price. It's not pricing in a discovery of any sort, let's put it that way. So thank you for your time, Mike. I appreciate it and I am looking forward to 2022. 

Disclosure: The author owns BTT.V shares at the time of publishing and may choose to buy or sell at any time without notice. Author has been compensated for marketing services by Bitterroot Resources Ltd.

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