Columbus Gold CGT 1

Columbus Gold (CGT.TO) has released a bunch of assay results in August from its 31 drill hole exploration program which was aimed at identifying additional gold mineralization in close proximity to the Montagne d’Or gold project in French Guiana.

Several holes have encountered gold mineralization with hole 295 returning an excellent 45 meters at 0.92 g/t gold but as this was a relatively deep hole (the mineralization was encountered at a down-hole depth of 524 meters) this might add ounces, but not necessarily mineable ounces. Other holes were much shallower and whilst 31.5 meters of 0.47 g/t gold and 37 meters at 0.48 g/t gold are below the average grade of the Montagne d’Or open pit, it could still be profitable to mine these zones in a later phase of the mine life considering the mineralization starts at just a few meters from the surface.

This is an excellent development and strengthens our thesis the feasibility study was just a first step. We already pointed out it would be relatively easy for Columbus Gold and its Russian partner Nord Gold to convert inferred ounces to the measured and indicated category which would have a very positive impact on the mine life and the NPV (as waste rock suddenly gets converted into mineralized rock).

Whilst the ‘regional’ exploration program doesn’t necessarily have an immediate impact on the NPV of Montagne d’Or, it does help to emphasize the potential of the project and this could be particularly interesting for anyone pursuing to acquire full ownership of the project.

Go to Columbus’ website
The author has a long position in Columbus Gold. Columbus is a sponsor of the website. Please read the disclaimer

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