Sabina Gold launches spring drilling at Back River project
Sabina Gold & Silver Corp. [SBB-TSX; SGSVF-OTC; RXC-FSE] said Tuesday March 6 that crews have been mobilized and are drilling at the Goose property on Sabina’s 100%-owned Back River gold project in Nunavut.
The company has commenced a 6,000-metre Phase one spring drill program. That will be followed by another 20,000 metres this summer.
A key focus of the first phase program will be a follow up on last year’s success at the Umwelt “Vault” and Llama Extension targets, where significant mineralized intersections included; 16.86 g/t gold over 13.50 metres in drill hole 17GSE511B at Vault, and 9.48 g/t gold over 38.55 metres in drill hole 17GSE516B at Llama Extension.
In addition to the continued drill testing of the main Umwelt and Llama gold structures, drilling will test targets located within significant gold trends where geologic modeling and past work indicates the potential for large scale growth.
These target areas or main trends include; the Goose Main gold trend; the laterally extensive DIF target horizon; and the over 2 km long Echo-Kogoyoko gold trend. Drilling will also continue to target down plunge and lateral extensions of the Echo deposit.
Sabina has budgeted $83 million this year for exploration and the advancement of infrastructure improvements needed to advance the Back River project towards production.
“During the 2017 exploration drilling campaign we had continued success in demonstrating the potential for new discovery and high impact additions to mine life at the Goose project,” said Sabina President and CEO Bruce McLeod.
“We have demonstrated that at Llama and Umwelt, the gold structures are robust for greater than 2 km with potential for continued growth down plunge,” he said.
“It is our belief that we can continue to grow our gold resources by aggressively exploring along our better known gold trends and the newly emerging gold trends that are targeted for priority drilling this year.”
On Tuesday, Sabina Gold shares rose 1.12% or $0.02 to $1.80. The 52-week range is $2.70 and $1.23.
Sabina is releasing its exploration plans after Zhaojin International Mining Co. Ltd., a leading Chinese gold producer and smelting company, agree to invest $66.1 million in the Vancouver company, via a private placement of 24.9 million common shares at $2.65 a share.
Zhaojin now owns a 9.9% stake in Sabina, a well-funded, emerging precious metals company with $94.5 million in cash.
Sabina holds a 100% interest in the Back River Gold Project, which has the potential to produce 200,000 ounces of gold annually for 11 years, according to the results of a feasibility study that was released in September, 2015.
At a US $1,150/oz gold price and 0.80 exchange rate, the study delivers a potential after tax internal rate of return of 24.2% with an initial capital expenditure of $415 million.