Brien Lundin is a specialist in junior resource stocks; in his latest Gold Newsletter, he reviews two recommended stocks that have seen positive developments in their mining projects.

The feasibility study Contango Ore (CTGO) had anticipated would usher in a construction decision at Alaska's Manh Choh hit the market in late July.

The study was produced by Peak Gold, the JV company in which Kinross Gold (KGC) owns a 70% interest and Contango a 30% interest. As planned, the mine’s ore will be batch processed at Kinross’s mill at its Fort Knox mine.

The benefits of this plan, which would see the partners truck Manh Choh’s ore up to Fort Knox, are clear. Not only will they not have to construct a mill or tailings facility, but they also will not have to wait to get those items permitted.

The feasibility study posits the development plan for Manh Choh will cost $182 million, including $30 million for a highway transport fleet. That would put Contango, with its 30% interest in Peak, on the hook for $54.5 million of the initial capex.

All in sustaining costs (AISC) are projected at $900/gold equivalent ounce, giving a margin of $800 per ounce at current gold prices. The mine is expected to produce 225,000 ounces of gold per year, which would mean 67,500 ounces per year directly attributable to Contango.

Early works have already begun at Manh Choh, and Peak Gold’s community work in preparation for construction continues. The mine is predicted to be one of the highest grade open-pit gold producers.

Another possibility is that some company may look to buy out Contango’s share of the mine (or buy out Contango altogether). Within two to two-and-a-half years, the company is looking at receiving $50 million a year at $1,750/ounce gold.

In this respect, Contango is more like a development-stage, premium royalty company than a typical junior explorer. Add in the exploration upside on the historically high-grade Lucky Shot project, on which drills are currently turning, and Contango Ore becomes one of the more compelling buys on our list.

Meanwhile, a couple of weeks ago, Vizsla Silver (VZLA) reported results from 26 holes on the Copala vein, a large and growing piece of the Tajitos-Copala resource area on Vizsla Silver’s Panuco project in Mexico. The results were nothing short of remarkable. Equally remarkable has been the market’s lackluster response to them.

Consider the highlights from the latest batch, which included Hole 191 (12.5 meters of 1,011 silver equivalent), Hole 173 (14.5 meters of 826 g/t silver equivalent), Hole 159 (10.5 meters of 418 g/t silver equivalent and 2.7 meters of 2,489 g/t silver equivalent) and Hole 181 (3.4 meters of 1,051 g/t silver equivalent).

So far, Vizsla has reported 72 holes from Copala and traced its footprint for 900 meters along strike and to 400 meters down dip. It has grown to a very significant size, yet remains open in all directions.

Moreover, the results from this latest batch have extended the high-grade shoot at Copala for 450 meters to the south-southeast beyond the resource boundary.

With an indicated resource of 61.1 million ounces silver equivalent and an inferred resource of 45.6 million ounce silver equivalent, Panuco has all the makings of a large, primary silver asset. The growth of Copala in recent drilling only adds to the project’s allure.

Vizsla Silver is one of those resource-stage companies on our list that I think could generate drill-hole-play type multiples with just a normalization in the silver and gold markets. For that reason, Vizsla is still very much a buy at current levels.

Subscribe to Gold Newsletter here…