Landore Resources (LND.L), the London-listed exploration company with an asset in Ontario, has just released an updated resource estimate on its fully owned BAM Gold project.
The new resource estimate – which isn’t NI43-101 compliant as Landore isn’t a Canadian company, now contains a total of 28.8 million tonnes at an average grade of 1.03 g/t for a total of 951,000 ounces of gold. Almost three quarters of this resource (20.2 million tonnes at 1.08 g/t for 701,000 ounces of gold) were part of the indicated category, with the balance (approximately 250,000 ounces) categorized as inferred resources.
Additionally, and this is where Landore’s resource calculation shows a material difference compared to NI43-101 compliant resources, the compay has an additional 14.76 million tonnes at 0.93 g/t in an ‘unclassified’ resource category, and perhaps this should just be seen as some sort of ‘exploration target’ as this ‘unclassified’ category isn’t JORC compliant either. The entire resource estimate was based on 169 drill holes for a total of almost 32,000 meters of drilling, along a zone with a strike length of approximately 3,000 meters.
The resource update is a clear positive as the total amount of gold increased by in excess of 50% while Landore considers the remainder of the 31 kilometer long Archean greenstone belt to be very prospective. In fact, Landore is even hinting at ‘a multi-million ounce gold deposit’, something it would never be allowed to do under the NI43 regulations.
Landore currently has a market capitalization of just over 10M GBP which appears to be cheap for what could easily be a 1M+ ounce gold resource, but as the project is a bit in the middle of nowhere, it will be interesting to see the economics in an upcoming PEA, which should be completed next month. The capex number will be very important to determine if this project could be viable on a standalone basis, and it will be interesting to see whether Landore includes a proposed hydropower station in its base case scenario or if it will use diesel generators.
In any case, the current resource of 951,000 ounces appears to be too small to be developed as a standalone project.
Go to Landore’s website
The author has no position in Landore Resources. Please read the disclaimer
