Allegiant Gold (AUAU.V) sure hasn’t been wasting any time after closing its financing earlier this year, as the company has immediately started the planned drill programs on a few of its early stage exploration projects. As a reminder, Goldcorp’s (GG, G.TO) main reason to invest in Allegiant was to position itself to ensure it would benefit from potential exploration successes on some of the projects in Allegiant’s Nevada asset portfolio.
The first drill program on the Red Hills project – which consisted of just over 2,300 meters in 9 drill holes) has now been completed and the samples have been sent to the lab. We hope to see initial assay results by the end of this month, but it’s not unlikely Allegiant Gold will wait for the assay results from all 9 holes to be received instead of putting the drill results out in two batches. AUAU is keeping the momentum going, as it immediately started a 12 hole, 2,550 meter drill program at Hugh Canyon.
Meanwhile, Allegiant has completed the first phase of its resource expansion drill program on its flagship project: Eastside just outside of Tonopah, Nevada. The assay results from the final 13 holes (Allegiant completed 8,265 meters of drilling in 22 holes) were released at the end of August, and confirm Allegiant appears to be successful in having expanded the Original Zone an additional 300 meters to the west and 400 meters to the south. On top of that, the mineralization appears to remain open in both directions.
We expect Allegiant Gold to be in a position to increase the current resource estimate at Eastside considering all holes were drilled in what was previously classified as ‘in-pit waste’. Converting waste to ore will have several benefits including a lower strip ratio on top of a higher amount of gold that could be recovered from the open pit. The difference is clearly visible as holes 147, 151 and 168 seem to have opened the mineralization further west:
Allegiant Gold has been guiding to try to ‘double the in-pit resource’, and the company now has a good shot at doing so. On top of that, several holes had to be abandoned due to poor ground conditions, and most of these holes actually terminated in gold mineralization, indicating the excellent exploration potential on the property.
A Phase 2 drill program at Eastside will start after Allegiant Gold completes its high-impact drill program on 6 of its early stage exploration properties in Nevada.