Argonaut Gold Inc. [AR-TSX] on Wednesday September 16 released results from a continuing drill campaign targeting high-grade mineralization below the proposed open pit at its 100%-owned Magino property in Ontario.
The Magino mine property is a past-producing underground gold mine located 40 km northeast of Wawa, Ontario, approximately 14 km southeast of Dubreuilville. The property consists of seven patented mining claims, four leased mining claims and 69 unpatented claims covering 2,204 hectares. The project is estimated to host proven and probable reserves of 58.9 million tonnes, grading 1.13 g/t gold or 2.13 million ounces.
A feasibility study released in November, 2017, indicates that the project could yield 2.0 million ounces of gold over a 17-year mine life with average production of 150,000 ounces during the first five years. Total capital costs in the feasibility study were estimated to be US$405 million.
Drilling highlights released on Wednesday include drill hole MA20-045 which returned 12.4 metres at 10.6 g/t gold, including 2.0 metres at 48.7 g/t gold. Hole MA20-43 returned 9.0 metres at 13.4 g/t gold, including 2.0 metres at 55.6 g/t gold.
Argonaut shares advanced on the news, rising 2.4% or $0.07 to $3.00 on volume of 765,753. The shares are currently trading in a 52-week range of $3.42 and 76 cents.
“The continuous high-grade nature of gold mineralization observed in the Elbow Zone is now also observed in the Central Zone,’’ said Argonaut President and CEO Pete Dougherty. “We continue to encounter high-grade gold intercepts below and adjacent to the proposed open pit, and now believe there is potential for a possible connection between the Elbow and Central Zones that we will be testing,” he said.
The Elbow Zone structure occurs along the northern geological contact of the WLS and volcanic rocks in the northeastern portion of the Magino deposit. It had previously been intersected in drilling over an approximate strike length of in excess of 500 metres.
“We also have several other high-grade structures to test at depth within and below the current mineral resource model at Magino west of the Elbow and Central Zone,” Dougherty said.