Key intercepts include 5.06 g/t gold over 25 metres (including 9.13 g/t gold over 11 metres), 1.8 g/t gold over 48 metres, and 2.19 g/t gold over 37 metres (including 12.1 g/t gold over 1.0 meres, plus another interval of 10.74 g/t over 1.0 metres.
Marathon has now published 88.5 kilometres of fire assay results with 11.5 kilometres still outstanding. The company expects to release an update to the Berry mineral resource estimate, along with updates to the Leprechaun, Marathon and Victory estimates by mid-year 2022.
To put this in context, Marathon’s first mineral resource estimate at Berry, which consisted of 640,000 ounces of inferred resources in 11.33 million tonnes of grade 1.75 g/t gold, was based on 42,000 metres of drilling completed to the end of November, 2020.
The next estimate will be based on the approximately 100,000 metres that was completed by the end of November, 2021. As a result, Marathon is optimistic about the potential for Berry to add a meaningful quantity of future mineral resources to the Valentine Gold Project mine plan.
On Tuesday, Marathon Gold shares were unchanged at $2.73 on volume of 248,450 and currently trade in a 52-week range of $3.73 and $2.12.
Marathon recently published a feasibility study for the project, demonstrating robust economics for a conventional open pit mining operation and a low initial capital cost and high rate of return. The feasibility study estimates an initial capital cost of $305 million.
The feasibility study also envisages a 13-year mine life, a 22-months construction and commissioning schedule.
The study also forsees annual gold production of 173,000 ounces per year and $119 million of annual average free cash flow between 2024 and 2033 from the processing of high-grade mill feed. Proven and probable reserves stand at 2.05 million ounces.
The Berry Zone is situated between the project’s Leprechaun and Marathon deposits.
However, the current Berry estimate is not included in Marathon’s core development plan at Valentine, which is based on two open pits at Marathon and Leprechaun and a central 2.5-4.0 million tonne per year mill.
Marathon has said that at some stage in the future Berry could provide options for mine-life extensions or future grade sequencing (pending future permitting).
The latest results follow news that Marathon has purchased for cancellation the historical 7.5% net profits interest royalty that covers certain areas of the Valentine project. Marathon paid $500,000 in cash and issued 1.34 million common shares (worth $4 million) to the Reid Newfoundland Co. Ltd., the private third-party vendor.
Marathon has agreed to pay an additional $3 million cash to Reid after the formal release of the project from both the applicable provincial and environmental assessment processes and confirmation that the project can proceed to the permitting for mine construction, subject to conditions.