In the world of junior exploration, finding a project with a high-grade historical resource, a permitted mine and a fully-owned processing plant is something of a holy grail. To find one in a Tier-1 jurisdiction like the US State of Idaho, and then to pick it up for a song from a motivated vendor is the kind of thing that market veterans talk about for years.

Enter Elk Range Mining which is about to hit the ASX boards with a remarkable brownfields opportunity that looks more like a mine-in-a-box than a greenfields punt.

The company completed a successful and significantly oversubscribed Initial Public Offering (IPO) raising $10 million at 20-cents a pop, with Inyati and Bank of Montreal (Euroz) acting as brokers to the issue. The funds will be used to breathe new life into its Idaho Gold project, an expansive package of tenements centred around the historic Orogrande gold district.

Elk Range’s cornerstone asset in the package is the Friday gold mine, a fully permitted underground operation located 15 kilometres southwest of Elk City. It was briefly brought into production in May 2020 before its previous owner, Finnish company Endomines, put it on care and maintenance in February 2022 amidst COVID-induced operational headwinds.

The company says the project comes with an extensive historical drilling database which points to a significant high-grade gold system. While not yet JORC-compliant, a foreign resource estimate for Friday outlined 758,000 tonnes grading an impressive 5.91 grams per tonne (g/t) gold for 144,000 ounces.

A quick scan of the historical drill results shows why Elk Range is chomping at the bit to get the drill rods turning. Previous intercepts include a stunning 110.3-metre-wide hit running at 5.34g/t gold from just 26.7m. The dataset also includes results of 54.1m at 5.62g/t gold from 237.7m, 31.7m at 7.80g/t gold from 232.3m and 134.6m at 2.52g/t gold from 223.4m.

These are not the kind of numbers you see every day. Combined, they point to a large, robust, mineralised system hosted within the structurally significant Orogrande Shear Zone that has seen virtually no modern, systematic exploration for two decades.

The historical work completed at Friday has confirmed not only the presence of a large-scale gold system, drilling has also defined a one-kilometre mineralised strike that remains open in both directions and at depth.

With the pre-raise cash now in the bank, Elk Range is not wasting any time. It has a 3000-metre, 10-hole diamond drilling program set to commence almost immediately designed to follow up on those historical results. The key objective of the initial campaign, which will see holes drilled to depths of up to 400m, is to obtain crucial structural information on the ore body in addition to confirming the impressive grades already uncovered.

And that’s only the first step.

Immediately following, the company will put in motion a second 3000 metre campaign designed to dig deeper under the existing underground mine and test the system at depth.

Notably, Elk Range also holds the nearby Orogrande processing plant, a permitted 50,000 tonnes per annum facility that is currently on care and maintenance. The previous owner tipped over US$40 million (A$57 million) into the project and Elk Range says the plant could be restarted within 12 months, offering it an efficient and low-capital pathway to production.

The company has already fielded approaches from other operators in the district about potential toll-treating arrangements, which could provide a source of non-dilutive funding to pour back into exploration. Additionally, the facility comes with its own assay lab, but for the upcoming drill campaign, Elk Range says the initial assays will be sent to Nevada for a quick six-week turnaround ensuring timely news flow.

Beyond the headline Friday mine, the Idaho Gold project also contains the Buffalo Gulch and Deadwood deposits. Each host substantial gold systems and add serious scale to the company’s district-wide ambitions.

Buffalo Gulch is a large, near-surface gold deposit with a non-JORC foreign resource estimate of 9.8 million tonnes grading 0.5g/t gold for 140,000 ounces. The bulk of this is oxide-hosted and historically been considered for heap leaching operations, however the real intrigue potentially lurks beneath.

Elk Range says previous drilling has barely scratched the surface. Geophysical data on hand suggests a significant untested sulphide system could lie beneath which may be controlled by the same Orogrande Shear Zone driving the regional mineralisation. With less than half of the prospective geology tested, Buffalo Gulch presents a compelling target for significant resource growth.

Similarly, the Deadwood deposit adds a further 59,000 ounces of gold to the inventory from a non-JORC foreign resource estimate of 2.4 million tonnes grading 0.8g/t gold. Deadwood is a shallow, oxide-dominant system where historical drilling rarely pushed past 150 metres. It shares the same geological DNA as Friday and Buffalo Gulch with its sulphide potential at depth remaining almost completely untested by modern exploration.

Together, the two deposits bolster the project’s total historic, non-JORC resource inventory to an impressive 343,000 ounces providing a solid foundation and a target-rich environment for Elk Range’s aggressive exploration strategy.

Elk Range says the initial work at Friday is just the starting point for a district-scale opportunity that combines aggressive exploration with potential opportunities for mergers and acquisitions. While previous operators focused on small-scale production, the company’s strategy is to use modern exploration techniques to test the broader scale potential of the system with an ambitious internal resource target of 2 -3 million ounces of gold.

To better assess the scale of the opportunity across its sweeping tenure, Elk Range will also fly a detailed LIDAR survey to map the district’s extensive historical diggings and old-timers’ mines.

Driving its ambitious strategy, the company has assembled a board and management team with deep experience in both North American operations and Australian capital markets. At the helm as chief executive officer is geologist Edward Keys who brings over 20 years of international experience in mineral exploration and resource growth across both Australia and North America. His CV includes senior exploration leadership roles at Brightstar Resources, where he contributed to significant resource growth, and Prodigy Gold, where he led large-scale exploration for gold and critical minerals.

The board is bolstered by non-executive chairman Campbell Baird, a mining engineer with over 30 years of global experience. Baird was formerly the chief executive officer of Focus Minerals and has held senior roles at SRK Consulting. Rounding out the executive team is executive director, company secretary and chief financial officer Leanne Kite - a chartered accountant with over 20 years’ experience. Kite most recently led investor relations for lithium heavyweight Liontown Resources and spent 13 years in senior finance and strategy roles at Woodside Energy.

The deal to buy the assets Elk Range has landed appears to be astutely structured. The company acquired the project from Endomines, a Finnish gold producer in a staged deal worth up to $20 million in cash and shares with set milestones over five years. The sale was driven by corporate strategy, with Endomines choosing to refocus on its Scandinavian assets, rather than having any issues with the project’s quality.

Significantly, Endomines is retaining a near-10 per cent stake in Elk Range - a move that aligns interests and shows the vendor still sees plenty of upside.

But perhaps one of the most compelling aspects of the story, alongside the mineral prospectivity already highlighted, is the jurisdiction. Idaho is a proven and supportive mining jurisdiction with a long history of production and more than 4300 people directly employed in the sector.

The state’s permitting frameworks are well-established and easy to navigate with coordinated engagement across federal and state agencies complemented by strong community and political backing for responsible mining. A corporate tax rate, enough to make your eyes water, of just 5.695 per cent further supports long-term investment.

The real kicker for the company, however, is the core of the Friday mine which sits on patented claims. In US mining law, this is a game-changer. The company holds surface rights in addition to mineral rights, dramatically cutting through red tape. This allows it to move quickly with drilling and exploration under straightforward local approvals enabling the company can hit the ground running.

Significantly, the ground Elk is set to dive into is well-known for its rich mineral endowment. Roughly 150km south lies the Stibnite gold project, owned by Perpetua Resources. Stibnite is one of the most high-profile and strategically significant mining developments in the United States, holding an estimated 4.8 million ounces of gold along with the country’s only major domestic reserve of the critical mineral, antimony.

To the north is the Sunshine district which hosts large-scale silver resources with a long run of historic production. Sunshine Silver, with a resource of 112 million ounces of silver just lodged its IPO prospectus with a US$2.3 billion (A$3.27 billion) valuation. The US$330 million (A$470 million) fund raised will be used to bring the mine back into operation and expand the project.

Elk Range says projects like these demonstrate the region is more than capable of hosting deposits of scale and the Orogrande Shear Zone has the potential to host multiple-million-ounce gold systems.

After raising the maximum $10 million, the company lists with a market capitalisation of only $25.2 million and an enterprise value of just $14.9 million. Based on the total 343,000-ounce historical foreign resource across its projects, this implies a valuation of just $43 per ounce - a significant discount to the typical $100-plus per ounce that comparable North American gold explorers command.

About to ring the bell on the ASX, Elk Range presents a surprisingly mature investment case. It’s not often a junior explorer comes to market with a permitted high-grade mine, a processing plant, a swag of walk-up drill targets and a clear pathway to an immediate boots on the ground activity.

With a full $10 million war chest, a two-pronged 6000m drill campaign about to kick off, and a clear line of sight to rapid news flow, if Elk Range’s initial holes can confirm – or even improve - on the quality of the historical results, this Idaho gold story could potentially get very big, very quickly.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au