Drilling at Probe Gold’s Monique project returns grades of up to 10 grams per tonne

Probe Gold (TSX: PRB; US-OTC: PROBF) says results from 37 drill holes, totaling 10,772 meters, have returned significant gold intercepts from surface to 425 meters vertical depth at the Monique gold zones at its Novador property near Val-d’Or, Que. 

Top results from the 2023 winter drill program included gold zones grading up to 3.8 grams gold per tonne over 24.4 metres (including 9.1 grams gold over 8.9 metres); 2.1 grams gold over 34.3 metres and 3.3 grams gold over 20.5 metres (including 58.6 grams gold over 1 metre).

Near-surface expansion and infill drilling in the northwest area of the conceptual pit intersected gold zones grading up to 1 gram gold over 62.5 metres (including 4.3 grams gold over 9 metres); 1.6 grams gold over 19.2 metres and 1.1 gram gold over 25.5 metres.

“An updated PEA is currently in-progress for the Novador project, which will offer a more comprehensive representation of the project’s expansion and progress towards a larger production scale,” said Probe president and CEO David Palmer. 

The company reported that all 37 holes drilled to identify or confirm in-pit mineralization returned gold intercepts over 0.42 gram gold, which is above the cut-off grade used in the 2023 pit-constrained resource estimate. Twenty-five holes returned gold intercepts with grade times thickness above 10 grams gold.

More than 50,000 meters of drilling, out of the planned 68,000 meters for the 2023 program at Novador have been completed. Two drills are active now: one at Monique and one on regional exploration, with more drilling planned for September.

Monique hosts total measured and indicated resources of 41.8 million tonnes grading 1.52 grams gold for just over 2 million oz., and inferred resources of 6.7 million tonnes at 1.65 grams gold for 357,200 ounces, according to an updated resource released in January 2023. 

The preliminary economic assessment (PEA) for the larger Novador project — released in 2021 — outlined an operation with annual production of 207,000 oz. over a 12.5-year mine life, with initial capital expenditures of $353 million. The PEA gave the project a net-present value of $598 million at a 5% discount and using a gold price of US$1,500 per ounce, an after-tax internal rate of return of 32.8% and a 2.7-year after-tax payback period. 

In a research note on Tuesday, Canaccord Genuity analysts Jeremy Hoy and MacGregor Ross said they’re encouraged by the continued drilling success at Monique, “featuring hits outside the current resource envelope at comparable grades.”

They added that they’re looking forward to the upcoming preliminary economic assessment (PEA) for the project, expected in early 2024, which they said they believe will outline a mine plan with more ounces, higher production levels and updated costs and with more certainty than the initial 2021 PEA.

 “We continue to like Probe for its 5Moz+ and growing gold resource, robust project economics, substantial production potential, and lower geopolitical risk,” they said.

The analysts give Probe shares a speculative buy rating and a $3.00 target. Probe shares traded at $1.53 in Toronto on Tuesday afternoon, giving the company a market capitalization of $246 million. Its shares traded in a 52-week window of $1.09 and $1.90.