Luna Gold Corp TSXV:LGC announced results from its Piaba gold deposit in northeast Brazil. Assays include
1.54 g/t gold over 36 metres
1.64 g/t over 31 metres
1.24 g/t over 24 metres
2.57 g/t over 53 metres
2.61 g/t over 14 metres
4.32 g/t over 31 metres
2.22 g/t over 54 metres
2.03 g/t over 35 metres
2.49 g/t over 55 metres
3.64 g/t over 22 metres
1.11 g/t over 25 metres
2.6 g/t over 41 metres
2.01 g/t over 52 metres
1.21 g/t over 38 metres
1.51 g/t over 65 metres
President/CEO John Blake tells ResourceClips.com, “We’re a producing gold mine. We hit our feasibility study production levels in August this year, and we’re producing at the rate of 60,000 ounces per year—we’ve been steady on that for the last three months. We’re working along the Piaba pit, which is a three-kilometre strike length of greenstone orogenic structure.
“We’re coming to the end of our drill program. The company embarked on a 40,000-metre drill program last August. We’ll cut off the drilling at the end of this month, and we’ll be doing our resource upgrade. We’re targeting the first week in December to make the upgrade public. The resource-definition program has been drilling along strike and at depth to improve our inferred resources to measured and indicated and also to add more ounces. The 1.3-million-ounce resource we have at Aurizona at the moment was based on 30,000 metres of drilling. We’re doing 40,000 now, so you can see what we’re trying to target in terms of an additional upgrade.
There are some very good high-grade intersections, but what it really demonstrates is that we’ve got really good continuity around about the 1.36 g/t range—John Blake
“What these results show is continuity along strike and at depth,” Blake continues. “We’re getting very good and consistent values, and I’d say that the upgraded resource is going to show that continuity both along strike and at depth. We’re very encouraged that we can get a sizeable increase in our resource, and these drill results just show that level of consistency. There are some very good high-grade intersections, but what it really demonstrates is that we’ve got really good continuity around about the 1.36 g/t range, which is our current resource head grade.
“We are in process with our scoping study at the moment which will be completed in 2Q 2012. Our market guidance for 2012 is for 60,000 ounces of gold production, and our scoping study will give us a path to produce 100,000 ounces in 2013.
“We’re an emerging producer at the moment, and we’re undervalued. If you look at our history, we’ve raised our capital through private placements. Last month, we raised $42 million with National Bank Financial as our lead. That’s the first time we’ve used banks. Up until now we’ve had no coverage, so we would be one of the only gold producers on the TSX without market analyst coverage. So we are not a well known story for the institutions. We haven’t actively marketed ourselves until recently because we weren’t producing, but now we’ve got a good story to tell.
“We went through a phase where we had mechanical issues in the construction phase that have been repaired and are operating,” Blake adds. “But now we’re delivering our feasibility-study production. We’ve revamped our management team, and we’ve got a really strong operational team now to add to the strong team we already had in finance and exploration. Also, we’ve recently recapitalized the company with WestLB in terms of new project debt financing, and we’ve raised equity in the market.
He concludes, “We’ve now got very solid capital structure to move the company forward. The next step is to increase our resource in December so we’ve got a solid platform for growth.”
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by Ted Niles