Big intersect sends Victoria shares soaring

A single hole at Victoria Resource‘s (VIT-V) Cove-McCoy project in Nevada was enough to send shares flying.

In Toronto on Dec. the company’s shares shot up 70% or 55 to $1.33 on 3.8 million shares traded. Its shares have traded between 54 and $1.58 over the past 52 weeks and it has roughly 72 million shares outstanding.

The hole was highlighted by 61.9 metres grading 12.57 grams gold including 42.2 metres grading 16.36 grams gold per tonne, 13.9 metres grading 37.21 grams gold and 12.2 metres grading 12.59 grams gold.

All of the intercepts came within an interval of 208.8 metres averaging of 4.6 grams gold.

Gold assays came from a hole NW-5 at Cove-McCoy a past producing open pit mine — which sits in the north-central region of Nevada.

While Victoria has yet to determine true widths of mineralization it has now drilled five core holes for 4,800 metres.

While NW-5 is its strongest hole yet, prior holes were highlighted by 38.4 metres grading 10.96 grams and 14 metres grading 8.16 grams gold in another hole.

Victoria’s chief executive, Chad Williams, says in a statement that the hole confirms the possibility of a large new gold system at the site and says the company will use the same exploration tactics at 14 other targets both at Cove-McCovy and at other sites in Nevada.

The hole was the first hole in Victoria’s second phase of drilling and six more holes are planned to test the mineralized area the company refers to as the Helen zone.

Victoria must spend US$8.5 million over seven years on exploration to earn a 100% interest in the project from Newmont Mining (NEM-N, NMC-T). Newmont has a back-in right once Victoria delivers a feasibility study with at least 500,000 oz. outlined. If it exercises the right, Newmont will have a 51% interest and Victoria will maintain a 49% interest. Newmont must spend 250% of the Victoria’s exploration expenses to earn in. If Newmont doesn’t earn in, Victoria will pay the major US$1.5 million in cash and will pay a net smelter return as high as 5% depending on the price of gold.