Investors remain aloof despite news from gold and silver producers
by Greg Klein
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Encouraging drill results and profitable production aren’t always enough to impress investors, as Claude Resources TSX:CRJ and SilverCrest Mines TSXV:SVL saw on November 27. Claude’s Saskatchewan gold assays and SilverCrest’s Mexican silver-gold-copper results each brought a slight but perceptible stock pullback.
Claude’s November 27 results came from its Santoy Gap deposit on the Seabee Gold Project, which includes two operating mines, Seabee and Santoy 8, in the La Ronge mining district of northeastern Saskatchewan. The assays show:
- 8.16 grams per tonne gold over 5.93 metres
- 5.07 g/t over 6 metres
- 3.51 g/t over 4.53 metres
- 5.03 g/t over 1.58 metres
- 4.68 g/t over 1.41 metres
True widths are estimated between 75% and 95%. A 3 g/t lower cutoff was applied, but no top cut. The deepest interval stopped at 649 metres’ depth.
These three holes extend the Santoy Gap mineralized system down dip and along strike toward Santoy 8, suggesting possible continuity, the company stated.
Results from this year’s 71-hole, 35,100-metre program will be used to update Santoy Gap’s December 2011 resource estimate, which sits at 2.32 million tonnes averaging 6.63 g/t for 495,000 ounces gold. The resource update, as well as an updated life-of-mine plan, comes due by year-end. Claude is now building an 850-metre-long exploration drift for further drilling.
The 14,400-hectare Seabee Gold Project’s five deposits come to:
- proven and probable reserves totalling 2.1 million tonnes with an average 5.37 g/t for 355,600 gold ounces
- indicated resources totalling 410,900 tonnes with an average 5.35 g/t for 70,700 ounces
- inferred resources totalling 4.19 million tonnes with an average 6.48 g/t for 873,400 ounces.
In Ontario’s Red Lake mining camp, Claude’s 4,000-hectare Madsen gold project includes four past-producing mines, along with some modern infrastructure intact. The high-grade estimate for Madsen’s four zones shows:
- indicated resources totalling 3.24 million tonnes averaging 8.93 g/t gold for 928,000 ounces gold
- inferred resources totalling 788,000 tonnes averaging 11.74 g/t for 297,000 ounces.
A 16-hole, 19,100-metre program using one surface and two underground rigs wrapped up in September. The company plans further drilling, along with a PEA study, next year. Infrastructure includes a permitted tailings facility, 500 tpd mill and a 1,250-metre shaft.
Claude’s other northeastern Saskatchewan project, the 40,373-hectare Amisk Lake property, comes with resources that show:
- an indicated category of 30 million tonnes averaging 0.85 g/t gold and 6.17 g/t silver for 827,000 ounces gold and 5.98 million ounces silver
- an inferred category of 28.65 million tonnes averaging 0.64 g/t gold and 4.01 g/t silver for 589,000 ounces gold and 3.7 million ounces silver.
Amisk is slated for a resource update and PEA to be released next year.
Seabee’s November 27 drill results followed closely on Claude’s Q3 report, which announced a net profit of $3 million or $0.02 a share and 15,073 ounces of gold production with cash costs of $920 an ounce. The company projects increasing production and decreasing costs reaching an estimated 90,000 ounces annually at about $800 an ounce by 2017.
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