Integra Gold (ICG.V) is currently using no less than eight drill rigs to work on the Lamaque Gold project in Val D’Or Québec and due to the company’s aggressive exploration programs, the labs are unable to follow Integra’s pace. This results in a substantial backlog as Integra is awaiting the assay results for approximately 52,000 meter of drilling!
The recent batch of drill results consisted of infill drilling at the Triangle deposit and seem to have targeted the C1 and C2 structures which are very close to the surface. That’s pretty logical considering these will very likely be the first C-structures to be developed and mined in the future. As it’s an infill drill program we already had a pretty good idea of what we could expect (at least that’s what we thought), but Integra managed to surprise us with an intercept of 2.8 meters containing in excess of 1.5 ounces of gold per tonne in the C2 Structure. There also was a zone of 3.7 meters containing 93.02 g/t gold, but the majority of the gold was found in a shorter intercept of 0.5 meters of almost 700 g/t.
What should you remember from this update? First of all, the gold is where it’s supposed to be, so the infill drill program is proving its value by increasing the confidence in the current resource estimate. Secondly, the C1 and C2 structures are shaping up to be pretty robust which is a really good sign for the company’s future development plans as the odds to encounter negative surprises are being reduced. Using a cut-off grade of 3 g/t the C1 and C2 structures contained 186,000 ounces of gold at an average grade of 6.5 g/t (135,000 ounces at 8.5 g/t using a cutoff grade of 5 g/t) in the indicated category and an additional 137,000 ounces in the inferred category at 5.9 g/t (96,000 ounces at 7.4 g/t using a 5 g/t cutoff grade).
Integra Gold still expects to complete a PEA before the end of this quarter and this will be the first PEA incorporating a 1Moz+ resource estimate so we are expecting a substantial increase in the net present value of the Lamaque project. Eldorado Gold (ELD.TO , NYSE:EGO) seems to be sharing our view, as, according to Canadian Insider, the company acquired an additional 2 million shares at C$0.44.
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The author holds a long position in Integra Gold. Integra is a sponsor of the website Please read the disclaimer
