Allegiant Gold Ltd. [AUAU-TSXV], the new spin out comprised of the Western U.S. exploration assets of Columbus Gold Corp. [CGT-TSX, CBGDF-OTCQX], released an update February 5 on exploration at its Bolo gold project northeast of Tonopah, Nevada. Shares of Allegiant, which is owned 16.7% by Columbus, rallied on the news, rising 8.3% or $0.05 to 65 cents in early afternoon trading, Monday.
Bolo is one of 11 Nevada exploration projects that were handpicked for Allegiant by Andy Wallace, a highly successful geologist who is now the company’s CEO.
Gold mineralization at Bolo is Carlin-type, similar to a number of other gold mines in the region (Pinson, Lone Tree, Stonehouse, Turquoise Ridge and Getchell), where gold spreads into wall rocks along high-angle structures.
Surface sampling at Bolo has defined widespread gold mineralization, associated with jasperoids and iron-stained structures, along two parallel north-south trending faults known as the Mine fault and East Fault. That material is amenable to cyanide leaching, according to results of preliminary metallurgical tests.
Alteration along the Mine Fault has been traced for 2,750 metres with outcrop sampling returning gold values of up to 8.6 g/t gold. The East Fault has been mapped for 2,000 metres and has returned gold values of up to 4.7 g/t gold.
“The Mine Fault and East Fault and dozens of outcropping and buried cross-faults at Bolo have had very limited drilling and represent excellent exploration targets,” the company said.
Allegiant went on to say that a multi-phase reconnaissance drill program designed to identify the altered structures on the large Bolo project with the best potential to host gold grade pods of Carlin-style gold mineralization is ongoing.
“Two such pods have been identified so far, and as more pods are uncovered, the focus will eventually shift to definition drilling to establish potential for resources,” the company said.
Working through his private company, Cordex Exploration LLC, Wallace has assembled a portfolio of projects headed by the 100%-owned Eastside property which hosts an inferred gold resource of 721,000 ounces of gold, and the Bolo property (also 100%-owned). Eastside is also located in Nevada.
The company said 1,900 drill samples were shipped out from Bolo in early December.
Eleven of the holes completed last year tested the previously undrilled Uncle Sam patented claim, which was acquired in 2016.
Uncle Sam covers a 500-metre strike extension of a fault zone located immediately south of an area that Columbus previously drilled. Highlights include hole BL-38 which returned 133 metres of 1.28 g/t gold from surface (including 30.5 metres of 3.24 g/t gold).
On December 5, 2017, Columbus announced that it had commenced drilling at Eastside. The aim is to expand the Original Zone, which hosts the inferred gold resource. Eastside also hosts an historical resource of 11.1 million tonnes grading 0.024 oz/ton gold (0.82 g/t gold), for a total of 272,153 ounces.
The company has said it sees a pathway to double the amount of gold resources at Eastside.
Subject to obtaining financing, Allegiant is planning to spend the next 12 months drilling 10 of the 14 projects in its portfolio.
In keeping with that plan, Allegiant recently closed a non-brokered private placement of subscription receipts that raised $4.2 million, an amount that is being held in escrow until the spin-out is complete. Another private placement by Allegiant is planned in early 2018 following the spin-out.