Simon Ridgway's Volcanic Gold Mines Inc. (VG) leapt 10.5 cents to 53 cents on 1.54 million shares on word that it has drilled a 14.8-metre interval averaging 3.96 grams of gold and 1,097 grams of silver per tonne at the Holly project in Guatemala. The high-grade hit occurred in the La Pena vein, where the silver grades continue to increase with depth. A week ago, the company hit an 11.12-metre interval that returned 6.29 grams of gold and 282 grams of silver per tonne.
"It is great to see the La Pena vein developing as a robust gold-silver system," enthused Mr. Ridgway, president and CEO. He also looked forward to assays still to come, noting that the company is currently drilling another stepout hole along strike of La Pena, "which does not appear to be a narrow shoot." Results should be available from several other holes first, however, including four tests that targeted the Alpha vein zone over a 450-metre strike. There, Mr. Ridgway cheers, the drilling appears to have intersected a robust vein and breccia with visible banded sulphides. (If one is not seeing visible gold, it helps a wee bit to view potentially gold-bearing rock.)
Not all the news warranted breaking out the party hats and kazoos at Volcanic today: Mr. Ridgway conceded that assays from four other holes targeting the El Pino vein system -- not La Pena, unless misgendering is a problem among geologists -- had cut weaker mineralization; so weak, it appears, that offering grades and thicknesses was unwarranted. What is perhaps warranted, says Mr. Ridgway, is more work at El Pino, as the zone is exposed over 100 metres higher than at La Pena.
Volcanic can earn a 60-per-cent interest in Holly and the nearby Banderas project from Bruce Smith's Radius Gold Inc. (RDU) by spending $7-million (U.S.) on exploration over a four-year period. The spending requirement called for 3,000 metres of drilling and a $1-million (U.S.) expenditure over the first year, which ended this spring. Radius, which added four cents to 27.5 cents on 579,000 shares on the news, has been puttering about at Holly for the past 20 years.
The first drill program in 2001 produced promising assays, with one hole yielding high-grade possibilities with 43.56 grams of gold and 1,618 grams of silver per tonne over six metres. A second hole managed four grams of gold and 150 grams of silver per tonne over 10.5 metres and the following year, a 10.7-metre interval returned 4.83 grams of gold and 265 grams of silver per tonne. Nevertheless, Holly endured long periods of inactivity, one from 2004 to 2010 and another from 2012 until last year, when Radius agreed to option the project to Volcanic.
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