Liberty Gold lifts Black Pine indicated resource by 52%

Liberty Gold (TSX: LGD) has released a resource update for the Black Pine oxide project in southern Idaho, significantly increasing the indicated and inferred ounces and highlighting a significant exploration target.

The company announced on Tuesday after markets closed that the deposit now hosts an indicated resource of 157.3 million tonnes grading 0.52 grams gold per tonne for 2.61 million oz. of metal, a 52% jump compared with that outlined in the initial resource announced just 18 months ago.

The inferred resource entails 35.15 tonnes grading 0.43 grams gold per tonne for 483,000 oz., 32% more than the previous resource estimate.

It now also includes a high-grade core within the 0.2 gram gold cut-off constrained resource pit shell, using a 0.5 gram per tonne cut-off. The high-grade portion entails 47.4 million tonnes grading 1.02 grams gold per tonne for 1.5 million oz. indicated and 7.3 million tonnes grading 0.93 gram gold for 219,000 oz. of inferred metal.

The significant increase in ounces can be attributed to the discovery and subsequent intensive drilling of 154 holes included in the resource in the Rangefront Zone beginning in July 2021 over 15 months. The company had succeeded in expanding and merging several existing zones, including the CDF, E, and M zones and the discovery of the Bobcat Zone, a southern extension of the CDF Zone.

The company’s drilling of surface waste rock storage and pit backfill and definition drilling in previously defined areas of inferred mineralization also contributed to the resource increase.

Liberty CEO Jason Attew said in a statement the resource update positioned Black Pine in the “rarified territory” of an oxide resource with more than 2.6 million indicated oz. and a further half a million oz. inferred.

Liberty Gold’s corporate technical advisor, Moira Smith, said the updated resource represented the next step in validating the company’s hypothesis that the Black Pine gold system might be the most extensive oxide gold system in the Great Basin not currently being mined.

“Our initial concept of a gold system hosted along low-angle, bedding-parallel faults over a wide area has withstood the test of time, and we were able to test the concept in an area of shallow cover to the east of the main zone of mineralization, resulting in a major discovery at Rangefront,” explained Smith.

The company said there are already another 40 holes pending assay results post-resource, pointing to strong potential for further resource growth. Smith estimates the resource potential within and outside the current resource pit, including across its other Great Basin property, Goldstrike, could extend to at least 7 million ounces.

Much of the gold system at Black Pine remains unexplored or incompletely tested, including areas along the southeastern, eastern and northeastern edge of the deposit, as well as the gap between the Back Range and E zones, the company said.

The 2023 drill program started on Jan. 7 in low-elevation areas along the eastern margin of the deposit. While the company awaits feedback on its recently submitted modification to the United States Forest Service plan of operations, it also recently received a Bureau of Land Management plan of operations approval, allowing access to some of these priority exploration areas.

The company has budgeted for about 32,000 metres of reverse circulation drilling, targeting resource upgrade and expansion over several areas of the deposit, as well as reconnaissance drilling in new places along the eastern margin of the deposit.

Haywood Capital Markets mining analyst Geordie Mark said the resource update was bigger than expected, with leverage to growth via the drill bit or at lower cut-off grades.

“This update marks a critical milestone as they have now bedded away a cornerstone resource mass to focus on improving and de-risking project economics by targeting shallow, high-grade mineralization and completed metallurgical domaining study for an upcoming prefeasibility study,” wrote the analyst in a note to clients.

At 58.5¢, the company’s shares traded 2.5% lower on Wednesday amid difficult markets generally. It has a market cap of $185.9 million.