Integra Resources (ITR.V) sure isn’t wasting any time as just months after it reported its first (inferred) resource estimate on the DeLamar gold-silver project in Idaho, it has now also released a maiden resource estimate on the recently acquired Florida Mountain project as well.
According to this estimate (based on in excess of 800 drill holes), Florida Mountain contains a gold resource of 675,000 ounces as well as 16.6 million ounces of silver at an average grade of 0.57 g/t gold and 14.12 g/t silver. This represents a gold-equivalent resource of 871,000 ounces at an average grade of 0.74 g/t, based on a pit outline using a mining cost of $2.40/t, a milling cost of $11/t and recovery rates of 95% for the gold and 80% for the silver. This brings the total DeLamar resource (including Florida Mountaing) to 3.54 million gold-equivalent ounces at an average grade of 0.71 g/t AuEq.
We have heard the occasional remarks about Integra Resources’ projects being low grade with just over half a gramme of gold per tonne of rock. Whilst that’s absolutely correct, we shouldn’t ignore Integra’s exploration plans as the company wants to chase the higher-grade veins on the property. This isn’t just an elusive dream as the previous operators of the mine had already discovered these veins but never gave them the attention they deserve. In Florida Mountain’s case, historical drilling rarely went deeper than 130 meters, so everything below the current low-grade open pit resource is pretty much ‘virgin territory’.
Some of the deeper holes confirmed the existence of higher grade gold structures with 3.1 meters at 14.05 g/t gold, 6.1 meters containing 17.76 g/t gold as well as a nice long interval of 19.8 meters containing 12.83 g/t gold. So whilst the low-grade open pit could be seen as low-hanging fruit, the real company maker could be directly under this pit.
Now both properties have been acquired and now both resource estimates have been published, we will dive into the technical reports and provide a more extensive update in the near future. With C$13M cash in the bank, Integra Resources is very well positioned for its 2018 exploration program, and further validating the high-grade vein theory should result in a re-rating of the company which is now trading at just US$14 per gold-equivalent ounce in the ground… The C$0.85 (warrant-free) financing will become tradeable on March 1st (right before PDAC), so keep an eye on weakness around that day.