Prodigy Gold (PDG-V) has more than doubled a 20,000-metre drill program at its Magino gold deposit near Wawa, Ont., to 45,000 metres after recent results defined new targets of resource expansion.
Infill hole S-88-0007, which was drilled in the deposit’s northeast, returned 207 metres grading 1.24 grams gold per tonne. The company says the hole correlates with previously reported holes 1, 3 and 4, which were released in mid-March, where hole 4 intersected 261 metres grading 1.13 grams gold. Prodigy notes that these holes expanded and upgraded the northeastern portion of the deposit.
At Magino’s southwestern edge, hole 14 hit 107 metres of 1.04 grams gold and hole 16 cut 57 metres of 0.73 gram gold. The company says both holes showed significant gold mineralization, which could expand resources southwest of the current proposed open pit at Magino.
A preliminary economic assessment (PEA) released in April outlined an open pit mine at Magino producing an average of 166,500 oz. gold a year over a nine-year life, totalling 1.5 million oz. gold, at an average cash cost of $521 (US$496) per oz.
The company has four rigs turning at the property and says about 17,000 metres have been drilled.
It also recently reported four other holes (12, 15, 17 and 21) that hit new gold mineralization along the deposit’s southern edge. The most notable of the four was hole 12 hitting 212 metres of 0.69 gram gold, including 61 metres of 1.06 grams gold.
Other holes that hit long, shallow, intercepts include: hole 7, which cut 211 metres of 0.5 gram gold; hole 8, which intersected 30.9 metres of 0.92 gram gold, and then another 417 metres of 0.71 gram; and hole 9, which cut 262 metres of 0.79 gram gold, including 119 metres of 1.04 grams. The company notes that the true thickness of mineralized zones in holes 8, 9 and 14 is thought to be 76% of the drilled length.
Prodigy says that the longer hits could boost the proposed mine plan because stockpile material could possibly be blended with higher-grade ore, producing a consistent head grade for the mill once the proposed mine is built.
The PEA estimates start-up costs for the mine to be $242 million, while the project would have a pre-tax net present value of $351 million, at a 5% discount, and a 49% internal rate of return.
Magino has an indicated resource of 51.6 million tonnes grading 1.16 grams gold for 1.9 million oz. gold, and another 17.5 million inferred tonnes of 1.04 grams gold for 587,100 oz. gold.
A feasibility study for Magino is set for early 2012.
The company has a 52-week trading range of 19¢-81¢, and its shares recently closed at 68¢.
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