Anaconda Mining rallies on Goldboro high-grade assays

Anaconda Mining's Point Rousse gold mine on the Baie Verte Peninsula, Newfoundland. Source: Anaconda Mining Inc.

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Anaconda Mining’s Point Rousse gold mine on the Baie Verte Peninsula, Newfoundland. Source: Anaconda Mining Inc.

Anaconda Mining Inc. [ANX-TSX, ANXGD-OTC], on Wednesday announced assay results for the first five holes of an ongoing 6,000-metre diamond drill program at the company’s Goldboro Project in Nova Scotia.

Highlights from this drill program include multiple occurrences of visible gold.  Assays of a high-grade tenor include 34.70 g/t gold over 3.5 metres and 24.34 g/t gold over 3.8 metres.

Anaconda shares rallied on the news, rising 6.3% or $0.025 to 42 cents. The 52-week range is 56 cents and 22 cents.

Anaconda is currently the only producing gold miner in Atlantic Canada. The company is producing roughly 15,500 ounces of gold annually at its Point Rousse Project on the Baie Verte Peninsula, Newfoundland.

The Point Rousse Project is comprised of the Pine Cove open pit mine, the fully-permitted Pine Cove Mill and tailings facility, the Stog’er Tight deposit and a new discovery called Argyle. The project covers 5,800 hectares of prospective gold-bearing property.

The 100%-owned Goldboro Gold Project is located in the Eastern Goldfields of Guysborough County.

The company said it has completed eight drill holes, or 3,553 metres since the program began in October, 2017. The focus was on a combination of down-plunge exploration and infill drilling on three geological sections of the Goldboro Deposit.

Each of the drill holes successfully intersected mineralized zones on both the East Goldbrook and Boston Richardson gold systems, reinforcing the potential for down-dip and down plunge extension of the Goldboro Deposit.

The latest drill results come just weeks after the company released a preliminary economic assessment (PEA). It demonstrates the financial potential inherent in the project, the company said.  Highlights are as follows:

  • Average annual production of 41,770 ounces, peaking at 62,000 ounces.
  • Average cash costs of US $525/oz and an all-in sustaining cash cost of US $640/oz.
  • Processing rate of 600 tonnes per day.
  • Total CAPEX of $89 million (only $47 million in pre-production expenditures).
  • Average head grade of 5.13 g/t gold.
  • Potential for up to 200 jobs at peak production.

The base case scenario outlined in the study envisions the creation of the company’s second center of operations, while leveraging Anaconda’s existing infrastructure and operating experience in Atlantic Canada.

“We will use the results of the PEA to optimize the economics, expand the mineral resources and move closer to demonstrating the feasibility of building a mine at Goldboro,” the company said.

Anaconda says it believes Atlantic Canada presents an opportunity because of the lack of competition for Atlantic Canada projects. Regional geology and structures possess the characteristics necessary to form economic gold deposits, the company said.

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