Golden Arrow Resources (GRG.V) has released more drill results and its investors continue to be spoiled as the most recent batch once again has expanded the surface area of the mineralized zones at the Chinchillas silver project. We are extremely impressed with holes 121 and 122 (see image for the location of these holes) which encountered respectively 43 meters of almost 12 silver-equivalent ounces per tonne and another 16 meters of just shy of 5 silver-equivalent ounces per tonne for hole 121, and 9 meters of 8 silver-equivalent ounces per tonne.
The results of these two holes are very important because they open up the boundary of the currently known resource estimate towards the west, and this means that the resources at the Silver Mantos zone will most definitely continue to grow in an updated resource estimate. At this moment the first 9,000 meters of the expansion drill program have been completed, and we expect another drill campaign focused on infill drilling to start shortly to increase and upgrade the current resource estimate.
Golden Arrow is advancing the Chinchillas project very aggressively, as it is now targeting to have a feasibility study completed by the end of this year. As we have no doubt the resource will grow, we expect a much higher Net Present Value for the Chinchillas project, and this should be reflected in its share price, especially after First Quantum Minerals (FM.TO, LON:FQM) acquired Lumina Copper (LCC.V) in a $470M deal. This increases the confidence in Argentina as a mining destination, as First Quantum will have to spend another $3B to get the Taca Taca project up and running, and you can be very sure these guys will have done their homework before buying Lumina Copper.
Disclosure: The author holds a long position in Golden Arrow Resources. Golden Arrow is a sponsor of the website. Please see our disclaimer for current positions.