The Goldsource Mines Eagle Mountain Gold Mine in Guyana, South America. Photo courtesy Goldsource Mines Inc.
Shares of Goldsource Mines Inc. [GXX-TSXV, GXSFF-OTCBB, G5M-FSE] rallied sharply on Wednesday after the company reported a new high-grade discovery at its Eagle Mountain Gold Project in Guyana.
The discovery was made during ongoing exploration in an area known as the Salbora target.
Highlight results include 40.0 metres (estimated true width) grading 6.52 g/t gold in diamond core hole EMD18-053.
A second diamond core Hole EMD18-052 intersected 17.0 metres (estimated true width), grading 2.82 g/t gold.
Investors reacted by sending Goldsource shares up 67% or $0.05 cents to 12.5 cents on volume of 8.79 million. That made Goldsource the volume leader on the TSX Venture Exchange in early afternoon trading, Wednesday. Prior to Wednesday’s news release, the shares had traded in a 52-week range is 3.5 cents and 10 cents.
The company has said its goal is to become a low cost gold miner in Guyana within the next three years, producing between 50,000 ounces and 70,000 ounces annually from a 4,000 to 5,000 tonne per day open pit operation.
The area known as Salbora is located approximately 1.5 kilometres northwest of the Eagle Mountain deposit. Eagle Mountain hosts an NI 43-101-compliant indicated resource (hosted by saprolite (oxide), and non-oxidized rock) of 3.9 million tonnes at 1.49 g/t gold or 188,000 ounces. On top of that is an inferred resource of 20.6 million tonnes at 1.19 g/t gold or 792,000 ounces. This resource estimate has an effective date of June 15, 2014.
The company has said it wants to increase the saprolite resources to a minimum of 600,000 ounces, grading 1.0-1.5 g/t via expansion and in-fill drilling.
Back in May 24, 2018, the shares rallied strongly when the company announced trenching results from the Salbora area, For example, Trench TRSB18-002 returned 123 metres grading 1.92 g/t gold. Also noteworthy are drill hole EMD18-011, which returned 6.0 metres, grading 1.51 g/t gold in the Friendly area; Hole EMD18-018, 21.4 metres grading 1.22 g/t gold, and Hole EMC18-057, 8.0 metres grading 2.65 g/t, which are in-fill holes in the Kilroy and Zion areas respectively.
The Eagle Mountain project is located 230 kilometres southwest of Georgetown, the capital of Guyana. It can be accessed by existing road or via a commercial airport, which is seven kilometres from the project site.
Eagle Mountain is also located 45 kilometres southwest of the former Omai gold mine, which produced four million ounces of gold between 1993 and 2005.
On Wednesday, the company said results from the near surface diamond core holes show high-grade gold mineralization below Trench TRSB18-002, which returned 123 metres grading 1.92 g/t gold.
The estimated mineralized footprint at surface, determined by initial work to date is 500 metres long, 50 to 100 metres wide, unknown depth from surface and open in all directions
Step out diamond core drilling is planned at Salbora in the first half of 2019 to help further define this high grade discovery.
“These diamond drilling results indicate the potential to delineate a near surface, wide, high-grade gold deposit at Salbora, which would expand the current resources at Eagle Mountain,” said Goldsource President Yannis Tsitos.
“The company is starting a step out diamond drilling program on 50 to 100-metre centres along the suggested strike of Salbora to test continuity of high-grade mineralization and further increase our understanding of the overall grade and size of this discovery.’’