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Analyst: New Discoveries Could Point to Regional Scale of Gold Mineralization at Quebec Project

Streetwise Reports, Streetwise Reports
0 Comments| July 2, 2020

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Recent drill results and project model changes, leading to an increased target price on Troilus Gold, are outlined in a Canaccord Genuity report.

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In an April 24 research note, analyst Tom Gallo reported that after updating its gold price forecast, Canaccord Genuity increased its target price on Troilus Gold Corp. (TLG:TSX; CHXMF:OTCQB) to CA$1.70 per share from CA$1.20. Troilus stock is now priced at CA$1.03 per share.

Canaccord increased its projected gold price to US$1,716 per ounce from US$1,631. Given this environment, Gallo also reported, new discoveries at the Troilus gold project in Quebec are "shining light on better potential project economics." Canaccord's estimated net asset value of the Troilus gold project increased to CA$594 million from CA$242 million, excluding the CA$72 million in value of the non-priority underground resource there.

Gallo reviewed Troilus Gold's recent new discovery in the Troilus project's Southwest zone, and noted that based on drill results from that, Canaccord added to its Troilus model 353,000 ounces at 1.1 grams per ton (1.1 g/t) gold in additional conceptual resources.

In Southwest, the drill bit encountered grades above 2 g/t gold at significant widths, which "support the potential regional scale of this mineralized system," highlighted Gallo. TLG-ZSW20-189, one of several highlight holes, demonstrated high-grade intercepts at Southwest. It returned 1.56 g/t gold equivalent (Au eq) over 73 meters (37m), including 2.05 g/t Au eq over 48m; 1.23 g/t Au eq over 6m from surface; 0.98 g/t Au eq over 13m including 1.9 g/t Au eq over 3m and 2.17 g/t Au eq over 2.2m.

Gallo pointed out that the strike length at Troilus, currently extending 4.5 kilometers from the J zones to the Southwest zone, is noteworthy. He wrote that it "could have positive implications for a potential future large operation, especially in a high gold price environment" despite the property's overall lower grade.

Canaccord Genuity has a Speculative Buy rating on Troilus Gold.



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