The drilling results were, on the surface pretty special. I wondered why the SP hadn't jumped spectacularly on the news.
I used Table 1 from the announcement to try and work out the true distribution of the gold from drill hole FVM351.
I've shown this below. Black indicates it's from the announcement and red indicates filling in the missing gaps:
It shows that the gold is concentrated at the 55m mark and then progressively the grade falls away from the 60m and 66m mark based on the data provided by BDR.
A previous poster indicated that the gold may be 'smeared' across the total drill length as it was an RC hole and not a diamond hole. I note that BDR have stated (below Table 1) that there is < 2 metre internal dilution throughout the hole so any smearing would be localised.
I'd be keen to hear from anybody with a geology background to confirm my layperson interpretation but I'd say that the gold is a concentrated pocket within the existing reserve that could yield some additional oz for BDR but is unlikely to provide a major reserve upgrade from outside of the known reserve envelope.
The geological model is encouraging however at depth and I would envisage that BDR will be able to profitably mine Duckshead well outside the current Reserve Pit Outline.
Unless others could provide an alternate view I can now see why the SP hasn't reacted as I'd initially thought.
Regardless - given the POG trend now (higher highs and higher lows) and BDR's metrics I still can't work out why it is priced so low nor why goldie's in general aren't performing better in this market.
Cheers John
BDR Price at posting:
66.2¢ Sentiment: None Disclosure: Held
