In what can only be described as a stellar debut on the drilling front, newly listed Elk Range Mining has pulled a massive 290.3-metre mineralised intersection averaging 2.8 grams per tonne (g/t) gold from the very first drill hole at its Friday gold project in Idaho, USA.
The market seems to agree, with the share price hitting an intra-day high of 24.5 cents on heavy volume, up more than 80 per cent from the pre-trading halt close.
Notably, the maiden hole has extended high-grade mineralisation by about 170 metres below the point where previous historical drilling stopped. The result also raises the intriguing possibility that earlier exploration may have stopped short of revealing the deposit’s full potential.
The remarkable intercept, which began just 18.7m below surface, delivered a whopping 820 gram-metres – a measure of the strength of the gold mineralisation calculated by multiplying the intercept’s grade by its length. The interval also contained a swag of high-grade zones, including an impressive 89.6m section grading 5.5g/t gold from 76.6m, which itself hosted a richer 37.1m core running 8.3g/t gold from 129.1m, adding weight to the potential for a substantial high-grade gold system.
Since previous drilling had only ever reached a depth of 137.16m, Elk Range’s maiden hole was designed to test the mineralisation below that point and delivered in spades, returning a further stunning 11.3-metre hit at 21.4g/t gold from precisely where the historical hole terminated.
The mineralisation just kept on giving, with further intercepts below the old hole including 12.7m running at 4.5g/t gold from 177.2m and 51.8m at 2.6g/t from 216.4m. The latter also housed a higher-grade 22.4-metre slice clocking a solid 5.1 g/t gold. The fresh assays also confirmed some eye-watering grades, including a 0.3-metre interval that returned a bonanza 268.4g/t gold and another 0.39-metre section that went a staggering 120g/t gold.
The results provide a stunning vindication for the company, which had previously reported multiple instances of visible gold in the core.
Every investor looking at an old mine asks the same question: did the gold stop where the drilling stopped? This hole answers it. The gold carries on for more than 170 metres below where the old hole stopped, starting with 11 metres at 21 grams per tonne. We drilled this hole along the shear zone to test its continuity, and it delivered: gold over 290 metres, with high-grade zones like 89.6 metres at 5.5 grams per tonne inside it.
The Perth-based explorer only listed on the ASX in August after raising A$10 million in a fully subscribed initial public offering and has wasted no time putting the funds to work.
The company’s Idaho portfolio is a brownfields play that comes with a head start. The Friday project already hosts a non-JORC foreign resource estimate of 758,000 tonnes grading a solid 5.91g/t gold for 144,000 ounces. Adding to the inventory are its Buffalo Gulch and Deadwood deposits, carrying respective non-JORC-compliant gold resources of 140,000 and 59,000 ounces.
Perhaps the real ace up its sleeve is the permitted 50,000-tonne-per-annum Orogrande processing facility and an on-site assay lab. The previous owner poured a hefty US$40 million (A$57M) into the project and management believes the plant could be restarted within 12 months, offering a potentially low-capital route to production.
The timing could also prove handy. Idaho is re-emerging as a mining hotspot, with major developments such as Perpetua Resources’ 4.8-million-ounce Stibnite gold project, 150 kilometres to the south, recently clearing key permitting hurdles, a strong signal the state is open for mining business and attracting serious capital.
Drilling is continuing at Friday, with the rig now working on a second pad. The remaining three holes in the phase-one program will test the system along strike and at depth, with future drill targets to be refined using structural insights gained from this first impressive hole.
For Elk Range to come out of the blocks with a 290-metre mineralised intersection from its very first drill hole is a rare feat. It suggests the company’s technical team has a solid handle on the geology at Friday, with the historical database proving a reliable guide. With drilling ongoing, a processing plant waiting in the wings and its saddlebags full of cash from the recent IPO, Elk Range’s Idaho gold story looks like it may be just getting started.
Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au