True Gold Mining (TGM.V) has announced more excellent drill results at its Karma Gold Project in Burkina Faso, Africa. The most recent drill program has revealed several mineralized zones north of the Kao deposit, with intriguing drill intercepts such as 90 meters at 1.5g/t including over 30 meters at in excess of 3g/t.
This new mineralized zone already is quite sizeable as the surface area is 780,000 m² which is only 1/3rd smaller than the Kao deposit which has a surface area of 1.25M square meters. This obviously bodes well for an increase of the resource estimate which will have a direct impact on the mine life and Net Present Value of the Karma project.
Meanwhile, True Gold also announced a capital raise whereby it issued approximately 112.5M shares at C$0.40 to raise C$45M to fund the equity part of the Karma capital expenditures. This means there are approximately 375 million outstanding shares right now, and the additional 56M warrants with a strike price of C$0.47 might cause an overhang over the current share price.
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Disclosure: The author holds no position in True Gold anymore. Please see our disclaimer for current positions.
