Post by
pipsqueak3 on May 03, 2017 10:58am
Highlights from NR May 3, 2017
https://www.stockhouse.com/news/press-releases/2017/05/03/sage-gold-grade-thickness-model-high-grade-zones-clavos
Very technically illuminating report that might be difficult for the average investor (like myself) to fully grasp. After reaching out to some mining pros, it has been affirmed that this NR is essentially stating that an expansion of the resource is not only highly probable, but also one that may bring in higher grades.
Seems to me like this project may be in the midst of a giant turnaround and could be a massive winner for 2017 and 2018; largely due to the fact $60 million has already been spent on the existing mine, there is a mill very close, which needs ore, and SGX Capex is nearly finished, which was received in the financing from Cartesian this summer.
The NPV of the current resource is still about 40% higher than the current EV of this company, which means these exploration and drilling projects are all free options. Once the gold is poured, the company can expand and explore till their hearts are content; with the obvious goal to expand resource and mine life and in all likelihood, one day acquire more properties and acquire the mill from the distressed company Primero, given this interpretation of the geologic model is accurate. Let me re-iterate - I am not a mining guy so forgive me if my analysis is too simple.
" An outcome of this work is that a number of high grade intersections are proximal to primary structures below the 300 metre level controlling the lens geometry."
"The majority of the higher grade composites occur below the 300 meter level below and adjacent to the mine infrastructure. The intersection of the high angle back thrust faults with the low angle imbricate thrust faults are within reach of drill stations on the 225, 285 and 300 levels. The model also provides vectors to potential new gold plunge directions higher in the Clavos deposit such as at the 100 metre east level. Underground definition drilling will commence on May 7th on the 100 metre east level. Further underground drilling will follow from the 225 level to fill in up plunge from KC99-137 and from the 285 and 300 levels to test up plunge from KC99-131 and 155W."
"We are looking forward to the commencement of our underground drill program and expect to be drilling these higher grade zones next month."
"The grade / thickness geological model reveals six major structures cross-cutting the main mine stratigraphy and the Pipestone Thrust Fault."
"The orientation and arrangement of these structures also displays a remarkable symmetry with structural lineaments interpreted from airborne magnetics. In a regional context, four of these arcuate structures exhibit the habit of imbricate thrust faults facing to the southeast. They conform with right lateral strike-slip deformation during the later stages of the D2 deformation compressional juxtaposing the Kidd-Munro ultramafic assemblage with the Davidson-Tisdale felsic volcanics. The imbricate thrust faults have orientations varying from 55 degrees to 70 degrees and transect the grade / thickness model at shallow angles to the west. A conjugate series of four back thrust faults with orientations at Az 150 degrees steeply crosscut the longitudinal section facing to the east. These faults served as important fluid corridors enhancing gold enrichment processes."