Earle's Commentshttps://www.goldalert.com/2011/01/gold-stocks-gdx-drop-canaco-climbs/Canaco Resources reported significant drill results from a 1,600-meter program of 12 holes, including 11 which were drilled over an 800-meter strike length. Highlights from the results included a massive sulphide intersection of 52.1 meters at 1.55 grams per tonne (g/t) gold, 4.10% copper, and 25.97 g/t silver in hole 10HTD003 starting at a depth of 45.6 meters. The company stated that drilling was performed as part of its due diligence process in acquiring the project, in order to “confirm the potential for a gold enriched, polymetallic Volcanogenic Massive Sulphid (VMS) deposit beneath gold rich gossans previously identified by surface trenching.”
Commenting on the announcement, Daniel Earle, TD Newcrest Metals & Minerals Analyst, characterized the Terakimti drill results as having a “significant positive impact” on the company. Earle also described the intercept at hole 10HTD003 as “spectacular.”
Canaco’s exploration assets in Ethiopia are comprised of six exploration concessions covering 468 square kilometers through a 70%-owned joint venture with Ezana Mining Development. Drilling conducted on the Terakimti concession is located 140 kilometers southwest along strike of Sunridge Gold’s (SGC.TSXV) Emba Derho VMS deposit, and 150 kilometers southeast of Nevsun Resources’ (NSU) Bisha VMS deposit, both in Eritrea.
The emerging gold company also announced that five diamond drill holes totaling 513 meters were drilled to test VMW potential on the Nefasit prospect, located 20 km east-southeast of Terakimti. Highlights from two holes drilled 470 meters apart included an intercept of 3 meters at 1.41 g/t gold, 2.34% copper, and 22.68 g/t silver, from a 52.15m depth.
Canaco went on to say that upon the completion of the Harvest acquisition, “it will consider options for maximizing the value of the acquisition for Canaco shareholders, including the possible spin-out of its Ethiopian assets into a new public company.” This strategy is intended to “allow Canaco to continue focusing on its promising gold exploration properties in Tanzania and the spin-off company to focus on its Ethiopian mixed mineral resource properties.”
Shares of CAN.TSXV bucked the trend of lower gold stocks, climbing as much as 3.7% to C$5.89 per share. Notable gold stocks moving lower alongside the GDX included Freeport-McMoRan Copper & Gold (FCX), Kinross Gold (KGC), and Newmont Mining (NEM). In morning trading GCX, KGC, and NEM fell 0.5%, 1.0%, and 0.8%, respectively.