Australia’s Bellevue Gold gets top marks from Macquarie

Macquarie Research has chosen Bellevue Gold (ASX: BGL) as its top explorer pick in Australia for 2019.

The junior, which trades at A49.5¢ per share and has a US$143-million market capitalization, is delivering high-grade drill results from its Bellevue gold project in Western Australia.

The company says it has delineated over 1 million oz. gold in less than 12 months at a discovery cost of A$15 per oz. gold.

In October 2018, the company increased its inferred resource for the project to 2.6 million tonnes grading 12.3 grams gold per tonne for 1.04 million oz. gold, with the addition of a maiden inferred resource for the Viago lode, which has an estimated 550,000 oz. gold within 0.8 million tonnes grading 22 grams gold.

Haul roads at Bellevue Gold’s namesake gold project in Western Australia. Credit: Bellevue Gold.

The past-producing Bellevue mine churned out 650,000 oz. gold (1.6 million tonnes grading 12.4 grams gold per tonne) between 1986 and 1997, and another 142,000 oz. gold between 1895 and 1909 (253,000 tonnes averaging 17.4 grams gold).

Resource expansion drilling over the next few months will focus on three areas: extensions north and south of the Bellevue underground mine, as well as a number of unmined areas near existing underground development; step-out down-plunge and down-dip drilling in the Viago lode; and depth extensions in the top 250 metres north of Bellevue workings targeting shallow-dipping mineralization intercepted in historic, shallow broad-spaced drilling.

The company estimates that the Bellevue lode historically produced 700,000 oz. gold at 15 grams gold from underground mining and another 100,000 oz. gold from open-pit, and says “a significant amount of mineralized material was left unmined during the previous operation, due to the mining of only ‘bonanza’ style, super-high-grade ore shoots, and leaving the proximal ore behind.”

Bellevue Gold says there is “significant potential” to extend the known mineralization along strike to both the north and south.

In December the company reported drill results from the Bellevue Surrounds area (in and around the historic Bellevue underground area), which it expects to bring into the resource category in the first quarter of this year.

Highlights from the drilling include 2 metres grading 26.1 grams gold from 269 metres’ depth; 4 metres of 16 grams gold from 197 metres; 2 metres of 13.1 grams gold from 417 metres; and 1 metre of 35.2 grams from 75 metres.

Those results, along with mineralized extensions south of the underground workings, “have confirmed the company’s view that there is [a] significant amount of high-grade gold mineralization remaining in and around the historic Bellevue underground area,” Steve Parsons, the company’s managing director, says in a press release.

The historic Henderson pit at Bellevue Gold’s namesake gold project in Western Australia. Credit: Bellevue Gold.

Parsons, a geologist, was previously managing director of Gryphon Minerals, which he founded and listed on the ASX. Gryphon established the 3.6 million oz. Banfora gold discovery in Burkina Faso. Teranga Gold (TSX: TGZ) took over the company for $100 million in 2016.

In October Bellevue Gold raised A$15 million in a private placement to institutional investors of 45 million shares at A34¢ per share.

Macquarie Research said in a recent research note that the company is top pick for its exploration potential. The company “recommenced exploration at Bellevue in late-2017 and quickly discovered the Tribune and Southern Belle lodes, followed up by the recent high-grade Viago lode [22 grams per tonne],” its analysts wrote. “BGL is well funded to drill … and we expect regular resource updates, and potential new discoveries to be key catalysts for the stock over 2019.

“Given its high-grade and close proximity to the sealed highway, we believe Bellevue could displace lower-grade ore into almost any regional processing plant. Combined with its large and prospective regional exploration tenements, we believe that BGL could make an attractive target for gold miners in the region.”