Gold Standard Ventures’ Railroad an ‘attractive target,’ Macquarie says

With Barrick Gold’s (TSX: ABX; NYSE: GOLD) now-abandoned hostile takeover bid for Newmont Mining (NYSE: NEM) putting new scrutiny of both companies’ assets in Nevada, Gold Standard Ventures’ (TSX: GSV; NYSE-AM: GSV) Railroad gold project in the state is “increasingly an attractive potential target,” mining analysts at Macquarie Research claim in a recent research note.

“Gold Standard Ventures has the largest undeveloped oxide gold deposit on the Carlin trend,” the analysts wrote in a Feb. 25 note to clients, stating that it puts the company “firmly on the radar for its [more than] 3.6 million oz. Carlin trend land position in the merger-mania context focused on Nevada.”

The company owns a 100% stake in the Railroad project, which makes up part of Gold Standard Ventures’ 18 km long land position in the gold-rich district.

“Gold Standard Ventures is in the early innings of documenting multiple deposits at Railroad,” the analysts forecast. “Dark Star has a high-grade, +1 gram gold oxide pit and an emerging sulphide resource to depth, with pit potential — typical of Carlin systems. Dark Star also has ‘Cortez-like breccias’ that are potentially high-grade feeders in the Penn Perm, with depth potential at the favourable Devil’s Gate contact. This makes Gold Standard Ventures an attractive target, especially in the context of the ABX hostile bid for NEM.”

Oxide gold deposits at
South Railroad-Pinion/Dark Star property. Credit: Gold Standard Ventures.

The Railroad project in north-central Nevada — 47 km southwest of Elko — covers 208 sq. km, and is next to Newmont Mining’s Rain and Emigrant mines.

It consists of the newly discovered Dark Star deposit, the near-surface, oxide gold Pinion deposit, and the classic Carlin-style North Bullion deposit.

The project covers 14 km of the Bullion fault corridor, a gold-mineralized, north- to south-trending structural corridor, which hosts both Pinion and North Bullion. North Bullion is 7 km north of Pinion, and the company says there are many untested targets in-between.

Dark Star, 2.1 km east of Pinion, is hosted at the north end of the 7 km long Dark Star structural corridor.

On March 4, the company reported more oxide gold results from 37 reverse-circulation (RC) infill and step-out holes in the southern part of the Dark Star deposit.

Eleven infill holes were drilled on the east side of the deposit. Noteworthy holes were 52 metres of 0.73 gram gold per tonne, including 14 metres of 1.58 grams gold in 19-37; 43 metres grading 0.50 gram gold, including 6 metres of 1.15 grams gold in 19-46; and 63 metres of 0.40 gram gold, including 8 metres of 1.04 grams gold in 19-52.

Dark Star has an indicated resource of 15.38 million tonnes grading 0.54 gram gold for 265,100 contained oz. gold, and an inferred resource of 17.05 million tonnes grading 1.31 grams gold for 715,800 contained oz. gold.

North Bullion contains indicated resources of 2.92 million tonnes grading 0.96 gram gold for 90,100 oz. gold, and inferred resources of 10.97 million tonnes grading 2.28 grams gold for 805,800 oz. gold.

Pinion has 31.61 million indicated tonnes averaging 0.62 gram gold for 630,300 oz. gold, and 61.08 million inferred tonnes grading 0.55 gram gold for 1.08 million oz. gold. The resource estimates will be updated this year with drill results from 2018.

Macquarie has a 12-month price target on the stock of $4 per share.

At press time, the company was trading at $1.51 per share within a 52-week trading range of $1.46 to $2.40.

Gold Standard Ventures has 260 million shares outstanding for a $392-million market capitalization.