After an initial jump shares in Solgold plc (LON, TSX:SOLG) were trading flat by lunchtime on Wednesday after the company, worth $865m on the Toronto stock exchange, released the maiden resource for the Alpala target at its massive Cascabel copper-gold project in northern Ecuador.
The latest in a string of announcements from Ecuador, where the Brisbane-based company have completed 63,500m of drilling not only shows the sheer size of Alpala, a porphyry deposit located on the Andean belt, the world’s richest source of copper, but a substantial high-grade “core” within the orebody.
Highlights from the maiden resource statement:
Solgold, which has $110m cash in the bank, said 11 diamond drill rigs are currently active at Cascabel and another starting up this month. Solgold plans 120,000m of further drilling at Cascabel in 2018.
SolGold’s CEO and Managing Director, Nick Mather, said in a statement: “This maiden Mineral Resource Estimate (MRE) is a tremendous start and in our view by no means represents a final size or grade because the deposit is still growing. That the maiden MRE is so big, achieved with so few drill holes and that such a large percentage is in the indicated category is testimony to the size of the system at Alpala.
“SolGold plans to announce updated MRE statements throughout 2018. We plan to immediately follow this maiden MRE up with initiation of a PEA (Preliminary Economic Assessment) of the deposit at Alpala, towards commencement of the PFS (pre-Feasibility Study) later in 2018.”
The company has in the past pointed out that Cascabel has produced “some of the greatest drill hole intercepts in porphyry copper-gold exploration history” and calls attention to Hole 12 which returned 1,560m grading 0.59% copper and 0.54 g/t gold including, 1,044m grading 0.74% copper and 0.54 g/t gold.
SolGold owns 85% of Cascabel located 180km north of the capital Quito, with the remainder held by Cornerstone Capital Resources (CVE:CGP). Shares in TSX Venture‐listed Cornerstone declined on Wednesday, dropping its market value to $159m.
Australian gold miner Newcrest Mining owns 14.5% in SolGold. Newcrest, the world’s sixth largest gold producer, put Craig Jones, the top exec at its giant Wafi-Golpu block caving project in Papua New Guinea, on the board of Solgold in March.