NxGold finds sources of Mt. Roe gold nuggets

NxGold Ltd. [NXN-TSXV] rallied Thursday June 28 after the company said initial trenching work at its Mt. Roe Project in the Pilbara region of Western Australia has confirmed the source of gold nuggets found on the property.

The company has previously said that gold nuggets found at Mt. Roe show similar characteristics to the recent gold discoveries by Novo Resources Corp. [NVO-TSXV, NSRPF-OTCQX], Artemis Resources Ltd. [ARTTF-OTC, ARV-ASX, ATY-FRA] and De Grey Mining Ltd. [DEG-ASX] in the same region.

Investors reacted by sending NXGold shares up 7.89% or $0.015 to 20.5 cents on volume of 697,585. The stock trades in a 52-week range of 40 cents and 14 cents.

In a press release on Thursday, the company said 15 trenches totalling 417 metres in length were used to initially evaluate approximately 1.8 km of the 7 km of prospective strike extent for the target sediment (conglomerate) horizon.

The company said the trenching confirms the potential sources of ‘specimen’ gold nuggets.

As a result of the initial trenching, the company said sedimentary rocks interpreted to be the source of the ‘melon seed’ gold nuggets have been locally exposed over approximately 160 metres of strike, including immediately adjacent to locations of recently collected gold nuggets, many with the classic ‘melon seed’ shape and texture.

A second phase of trenching is now proposed in this area to expose a larger volume of highly prospective sedimentary rock units for the purpose of larger scale sampling in the near future.

NX Gold holds an 80% stake in the Mt. Roe Project. “We have continued to discover gold nuggets across the Mt. Roe property and results from the exploration trenching work is very encouraging,” said NX Gold CEO Christopher McFadden. “The geological features are continuing to provide insight into this exciting project,” he said.

Meanwhile, the company said it recently undertook a first pass orientation of the Prinsep Project to assess the prospects on a land package that sits 12 km northwest of the Mt. Roe claims. A site where 45 gold nuggets were detected was confirmed, highlighting the prospectivity of the Princep Project, the company said.

“Additionally, sourcing 45 gold nuggets on the Princep licenses is also very exciting,” McFadden said.

News of this exploration work comes after the company recently announced that due to demand from investors, the company elected to upsize a previously announced non-brokered private placement of units to $4.3 million from $1 million.

“Now that we have closed our successful $4.3 million financing, we are looking forward to undertaking expanded follow-up work on our projects that will be guided by this initial work,” McFadden said.

Artemis Resources recently said Pilbara is blessed with both iron ore and oil and gas resources. “We believe that the Pilbara has a third mega-resource: gold,” it said.

NxGold has recently entered into an earn-in agreement with Meliadine Gold Ltd. to earn up to a 70% interest in the Kuulu Project (formerly known as the Peter Lake Gold Project] in Nunavut.

Under an October, 2016, agreement, a predecessor of NxGold gained the option to acquire the first 50% interest by spending $10 million on the property. It agreed to spend another $25 million to increase its interest to 70%.

The Kuulu Project is located about 40 km northwest of Rankin Inlet, and covers 4,174 hectares immediately along trend from Agnico-Eagle Mines Ltd.‘s [AEM-TSX, AEM-NYSE] Meliadine gold mine, scheduled for start-up in Q3 2019.