SOLG, page-21

Proactive investors

Solgold* (LON:SOLG) 45p, Mkt Cap £641m – Holes 19-25 show ongoing massive intersections of copper and gold mineralisation
(SolGold holds an 85% interest in ENSA which which holds 100% of Cascabel)
• SolGold is reporting an update on holes 19 – 25 at the Cascabel project in Ecuador.
• The results show more of the very long intersections of copper, gold mineralisation which we have come to expect from Cascabel
• The first two holes, 19 and 20R show final assay results with hole 19 showing a particularly impressive intersection of 552m grading 0.68% copper and 0.45g/t gold.
• This equates to 1% copper equivalent or 1.41g/t of gold at today’s metal prices which are good numbers when considered over such long intersections.
• Hole 19 final results return:
o 1,344m @ 0.44 % copper and 0.28 g/t gold from 268m (at 0.10% CuEq cut-off), including:
o 980m @ 0.55 % copper and 0.36 g/t gold from 514m (at 0.30% CuEq cut-off), and
o 552m @ 0.68 % copper and 0.45 g/t gold from 822m (at 0.5% CuEq cut-off).
• Hole 20R intersects strongly mineralised porphyry clasts within hydrothermal breccia returning open-ended intersection of:
o 498.4m @ 0.20% copper and 0.15 g/t gold from 844m (at 0.10% CuEq cut-off), including:
o 126.0m @ 0.27 % copper and 0.32 g/t gold from 1136m (at 0.30% CuEq cut-off), and
o 44.0m @ 0.27 % copper and 0.58 g/t gold from 1202m (at 0.50% CuEq cut-off).
• Visual estimates:
• SolGold also reports estimates based on visual inspection of Hole 21. It is unusual to describe and estimate grade in this way but we consider it to have value based on previous drill results from the Cascabel project.
• Hole 21 shows another massive intersection of 925m from 685m depth. Visual inspection shows an estimated “average of >1.5 volume-percent chalcopyrite, which includes a zone that averages >2.0 volume-percent chalcopyrite over a down-hole length of approximately 490m. The abundance of bornite in the 925m interval is visually estimated to range from zero to 0.5 volume-percent. Chalcopyrite and bornite are copper sulphide minerals that contain 34.6% and 63.3% copper, respectively. Assay results for Hole 21 are expected in late April 2017.”
• Hole 22 also intersects visible copper sulphide mineralisation from a much shallower 253m depth to around 1,150m depth. The drill core also shows “very strong bornite mineralisation around 960m depth”. The drill core also shows multi-directional quartz -chalcopyrite ±bornite veining occupies up to a maximum of 23 volume-percent in parts of Hole 22. Assay results for Hole 22 are expected in early April 2017.”
• “Hole 23R intersects hydrothermal breccia and strong phyllic alteration, with the presence of mineralised porphyry clasts in parts of the breccia. Hole 23R, at a current depth of 356.6m, is planned to intersect deep untested mineralisation up to 1800m below surface and has a planned hole depth of at least 2000m.”
• “Hole 24 continues drilling at Alpala Southeast, at a current depth of 649.5m testing approximately 570m to the southeast of Hole 23R. To date Hole 24 has intersected strong pyrite and trace chalcopyrite and trace bornite and molybdenite mineralisation. Hole 24 is planned to extend the known mineralised corridor at Alpala to some 1150m from Hole 13 in the northwest.”
• “Hole 25 continues drilling at Hematite Hill, at a current depth of 560.5m testing some 250m to the southeast of Hole 23R. To date Hole 25 has intersected hydrothermal breccia with strong phyllic alteration and trace chalcopyrite mineralisation, and has a planned hole depth of 2000m.“
• A fourth man-portable drill rig is expected on site shortly.
• See maps etc at: https://www.rns-pdf.londonstockexchange.com/rns/4981B_-2017-4-4.pdf
Conclusion: Hole 19 presents a particularly good intersection. We are grateful for the estimate given on Hole 21 where management have taken the time and trouble to work out a probably estimate grade range by visual inspection. This sounds like a particularly good hole and we should see the assay results for this in the next few weeks.
We note, many joint ventures with major mining companies are reluctant to publically report results till absolutely necessary and often then in large batches after the management of the major have formed their view of what they want to do.
We are therefore pleased to see SolGold continuing to publish drill results as they are released and to take the trouble to give an early estimation of the potential grade from what sounds like a particularly interesting drill hole. While we would not want to see many mining companies report results in this way we do feel this is appropriate in this particular situation and we look forward to the final assay reconciliation. If Cascabel does turn out to be one of the world’s next major copper mines then we may be grateful for SolGold’s early reporting of its results.