I'm still reeling from the fact that I made it this far in life without appreciating that Québec Province was a mecca for gold mining. But now that I've discovered this (pun intended...) piece of information I'm finding news about gold mining in eastern Canada everywhere. And it's good news indeed, especially for companies like
Alexandria Minerals Corporation (TSXV: AZX) (OTCQB: ALXDF), a development-stage company engaged in the acquisition, exploration and development of mineral resource properties in Canada.
The company is focused primarily on its Cadillac Break property in Québec where it reported 2 weeks ago on the discovery of high grade gold veins at the drill site Orenada Zone 4. Drill highlights include: 9.00 g/t gold over 13.85 meters, including 16.23 g/t gold over 5.05 meters; 6.29 g/t gold over 15.35 meters; 4.85 g/t gold over 12.00 meters, including 9.15 g/t over 3 meters. These results come from a previously untested area. To put all this jargon in layman's terms, in gold mining, 10 g/t is a high-grade deposit for gold. 1 g/t is a low grade that indicates an area is not particularly mineral dense. So these results for Alexandria Minerals Corp indicate a lucrative drill site. By the end of May, the company plans on having three drills active in this area.
To further understand the significance of the drill highlights reported by Alexandria, it's helpful to translate the statistics above. In gold mining there are vertical strikes and horizontal strikes, and deposits are either poryphyry or vein. A poryphyry could be spread over an area of several kilometers. Veins are not that large; a one or two meter vein is regarded as thick. If a report indicates a vertical strike length of 50 meters, that means the deposit is 50 meters deep. A vertical strike length of 50 meters can also indicate the deposit is 50 meters from the top of the deposit to the bottom, based on the context of the report. One is not necessarily better than the other, as ultimately it is the grade, or quality of the deposit that counts. A horizontal strike length shows how far the area of mineralization is spread. It's also good to know that drilling is much more cost effective if the deposit is shallow, or closer to the surface.
Many geologists and mining experts consider the Canadian province of Québec to be an excellent region for growth in gold exploration and mining, due in part to the relative amount of unexplored land. Mining has only been an industry in Québec since the mid 1920s, and an estimated 40% of the regions's gold and mineral potential is yet undiscovered.
As they head into the warmer drill season with solid exploration reports and strong financials, it could be a very lucrative summer for both the junior mining company and its investors. Alexandria Minerals recently announced a $2 million private equity placement, and according to their financials Agnico Eagle (NYSE:AEM), a global leader in the gold mining industry, owns 7% of the company. (Management and insiders own 6%.) With $7 million in cash and another $2.3 million in credits and other assets, the company is well positioned to make the most of the gold mining opportunities in their portfolio property.
Sara Cornell is a paid contributor of the SmallCap Network. Sara Cornell's personal holdings should be disclosed above. You can also view SmallCap Network's complete Disclaimer and SEC Rule 17b Disclosure.