Western Gold Resources (ASX:WGR) has today flagged low grades of gold, in “raw data format,” on-site at its Gold Duke play in Western Australia. If that sounds like a somewhat odd way to describe assay results, that’s because it is; Thursday’s announcement from WGR was a little unusual.
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The company wrote: “[We] received first assay results in raw data format on September 12 for 20 holes of the 1,107 holes planned, the data is incomplete and unvalidated, once compiled, the company will prepare the results for release.”
What “raw data” actually means is unclear, given that presumably any data returned from an assay lab would be raw anyway.
Then, to make matters more confusing, the company then posted its “raw data” on page 16 of the announcement, which effectively demonstrates low-grade hits, judging (albeit subjectively) by the parts-per-million (ppm) column.
The fact that WGR has buried that info on page 16 of its Thursday disclosure may have hurt more than it helped when it comes to investor confidence. The fact of the matter is, dataset maturity issues set aside, it’s a standard drilling announcement without any immediately apparent information about drilling.
One familiar with the daily ins and outs of the prolific ASX exploration sector, if you will, generally expects to see drilling and mineral purity (or grade) data more or less around the top of the document to quickly process what the company’s exploration results suggest for future profitability.
With that information, the invisible hand of the market collectively puts the stock at what its fair value should be. Or at least, that’s how it works in theory, which is true if you’ve got enough organic liquidity.
One could ask why exactly the company has omitted grades entirely from the topline segment of its disclosure, especially given that while low grades do often disappoint, at the same time, many investors are sympathetic – or, perhaps a better way to say it is they’ve got a forgiving risk tolerance – to subpar results.
WGR last traded at 11cps.
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