Pilot Gold (PLG.TO) has announced it has discovered a new copper-gold zone at its TV Tower project in Turkey. The company was drilling a porphyry target and one of the holes hit exactly what Pilot was looking for, as the drill bit has intersected an interval of 153 meters, starting at surface, containing 0.99g/t gold and 0.39% copper. As the rock value of this zone is roughly $67/t, you could easily consider this to be a high-grade intercept for a porphyry deposit. Additionally, it’s exciting to see the mineralization starts at surface as this could be important in a later stage when a PEA has to be completed.

Pilot Gold currently owns 40% of the TV Tower project and can increase its stake to 60% by funding a three year exploration program. At that time, Teck Resources’ (TCK.TO, NYSE:TCK) 60% stake will be reduced to 40%.

Pilot Gold has also announced an offer to acquire Cadillac Mining (CQX.V) in an all-share deal. Each share of Cadillac Mining will be converted into 0.12195 shares of Pilot Gold should the transaction be approved. Based on Pilot’s current share price of C$1.38, the offer has a value of C$0.168 per Cadillac share (meaning the Pilot Gold warrant at C$2.00 is valued at C$0.017), meaning Cadillac is currently trading at a premium to the offer (if you’d attribute a zero value to the warrant). However, it could be interesting to keep an eye out for a discrepancy between the offered value and the Cadillac share price, as it could be a possibility to pick up shares of Pilot Gold on the cheap. Cadillac Mining’s asset is very similar to Mt Kinsley (in a JV with Nevada Sunrise (NEV.V) ), as it’s a past-producing project with a large database on a large land package. The company intends to apply its Kinsley Mountain structural models to target different structures and stratigraphy.

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Disclosure: The author currently has no position in Pilot Gold but might initiate a position anytime. Please see our disclaimer for current positions.

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