Premier investigates Geraldton high grade and bulk tonnage potential

Premier Gold Mines (PG-T) plans to drill 50,000 to 100,000 metres on its exploration projects in Northwestern Ontario and Mexico this year with a new focus on the Geraldton project.

The company plans to have eight or nine drills in action, including four on the Rahill-Bonanza joint venture in Red Lake where partner Goldcorp(G-T, GG-N) took over operatorship by boosting its ownership by 1% to 51% in January.

“That was largely expected on our part,” says Stephen McGibbon, Premier’s chief operating officer. “At the time of the joint venture we were pretty sure they would be taking on operatorship within that 18-month window.”

Instead, the company’s direct activity will be in Geraldton, where up to three drills will be exploring the newly discovered Kailey zone, which is located parallel and to the north of the past producing Little Long Lac gold mine, which produced more than 600,000 oz. gold between 1934 and 1953 at an average grade of 11.66 grams gold per tonne.

So far, two initial holes have been drilled on the Kailey zone about 150 metres apart one drill hole returned a 51-metre intersection grading 1.33 grams gold per tonne starting from 28 metres depth and the other returned 26 metres grading 1.34 grams gold per tonne starting from 137 metres.

One of the holes also intersected the on-strike extension of the Little Long Lac Main zone with an intersection of 1 metre grading 13.58 grams gold per tonne, located about 50 metres east of where the zone was mined.

Two other important zones have also been intersected known as No. 9 and No. 10 zones, where drilling intercepted 1 metre grading 254.8 grams gold per tonne, 1 metre grading 60.88 grams gold per tonne and 1 metre grading 45.3 grams gold per tonne, which the company says shows potential for both bulk tonnage and high-grade mineralization.

McGibbon says that Premier agreed to the joint venture for the Geraldton project partly for this potential lower exploration risk plus good infrastructure and geopolitically stable.

“We felt with the Geraldton district, it has not participated in the flurry of activity that we’ve seen in Canada in general in the last five to ten years certainly, but even more than that, the ground that we’ve picked up really hasn’t seen good systematic exploration in the last fifty years or so,” McGibbon says.

Premier has an option to acquire up to 70% in the Geraldton project from Roxmark Mines (RMK-V).

The company will also have one drill at its PQ North property 430 km northwest of Thunder Bay, near Pickle Lake and at its Santa Terasa project in Baja California Norte, Mexico.

Premier shares rose 2 to $2.06 in Toronto today on a trading volume of 343,000 shares.