Golden Star Resources (GSC-T, GSS-N) has released impressive drill results from its Wassa gold mine in Ghana, but the economic implications of the mineralization are still unclear.
Highlights from five holes include 32.6 metres grading 7.5 grams gold per tonne, 11.2 metres of 20 grams gold, 29 metres of 7.5 grams gold, 19 metres of 10.2 grams gold and 31.7 metres of 7.3 grams gold.
The results pair nicely with an updated resource estimate for the property. At the end of March, Golden Star upped reserves by 85% to 31.9 million tonnes at 1.45 grams gold for 1.5 million contained oz. gold from the previous estimate of 18 million tonnes at 1.38 grams gold for 799,000 oz. gold.
The estimate incorporated drill results from up to last August. From last September until the end of March, it punched another 194 holes into the ground for 70,332 metres.
During the first quarter, much of the new drilling was split between testing zones down-plunge of the gold-bearing fold hinge and doing infill drilling.
The company expects to use the most recent drill results in an updated resource model, due out in the third quarter.
BMO Capital Markets analyst Andrew Breichmanas notes that the drill results improve markedly at depth, and that “efforts to expand the processing plant and bring additional open-pit resources into the mine plan may be hindered by the cost of excessive upfront waste stripping.”
BMO Research calculates a weighted-average intercept of 2.51 grams over a true width of 10.3 metres from nearly 250 mineralized intervals reported by Golden Star.
Golden Star has a 90% stake in Wassa, which sits in southwestern Ghana, 35 km east of its Bogoso gold mine.
The property lies within the Eburnean geological province in the West African Precambrian Shield, with mineralization hosted within the same Birimian volcanic-sedimentary greenstone package as its Bogoso-Prestea mining property. Wassa is located along the eastern limb of the Tarkwa syncline, bounded between Tarkwaian sediments in the west and Cape Coast granites to the east.
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