Freeman Gold (FMAN.C) has had to exercise a lot of patience with the lab it has been using for its exploration program on the Lemhi oxide gold project in Idaho. It took a while for the assay results to come in and fortunately the delays do not indicate any issues with the project or the drill program as the recently released intervals confirm the existence of thick zones of gold mineralization at Lemhi.
In a drill update last week, the headline result was 174 meters containing 0.9 g/t gold almost starting at surface including some higher grade intervals like 7.1 meters of 3.8 g/t gold and 18.5 meters of 3.9 g/t gold. While those two intervals obviously push up the average grade of the entire 174.2 meters, the smearing is pretty limited as the 149 meters outside these two high-grade intervals still have an average grade of approximately 0.39 g/t gold. Much lower, but still above cutoff grades for these types of deposits.
The company reported on the assay results of eleven holes and you can find the entire breakdown on the image below.
As a reminder, the 34 diamond hole drill program was aiming to increase the confidence level in the historical drilling which contains data of about 355 drill holes and the new data will go a long way to establish a maiden NI43-101 resource estimate at Lemhi. Based on the assay results of the 11 holes, the drill program is well on its way to meet the primary endpoint and the mineralization has now been confirmed to a depth of at least 210 meters (and remains open at depth) while there may be additional exploration potential towards the east of the currently known mineralized envelope as hole 14C encountered almost 22 meters of 1.2 g/t gold starting at a depth of almost 158 meters down hole.
Consistency and continuity seem to be the key words Freeman Gold is focusing on, and the second batch of drill results which contained date of all the remaining holes was even better with a stunning 151 meters of 2.5 g/t gold and even if you would filter out the 25 meters of 8.7 g/t gold, the remaining 126 meters would still contain 1.27 g/t gold.
Great results, but the share price barely moved as the market shrugged it off. We noticed about 75% of the selling on Thursday and Friday was routed as ‘Anonymous’. About 27 million shares have now been released from escrow since the stock started trading and on April 16th the final batch of about 10 million shares will be released from escrow. Since April last year, a net amount of 33M shares (sales minus buys) has been sold through anonymous and of course not all anonymous sales are related to the escrowed shares, but the anonymous selling pressure should wane after the final batch comes out of escrow. The reduced selling pressure, in combination with the good drill results and hopefully a maiden resource estimate exceeding a million ounces should help to re-rate the stock as the current market capitalization of less than C$40M seems to be rather low.
Now the drill program has been completed, the Lemhi gold project remains open in all directions and at depth which means the upcoming resource estimate will likely just be a starting point.
We will be in touch with CEO Will Randall soon and will provide a detailed update shortly thereafter.
Disclosure: The author has a long position in Freeman Gold. Freeman Gold is a sponsor of the website. Please read our disclaimer.