Gold Summary for July 11, 2019

New York spot gold fell $15.20 to $1,403.20 on Thursday. The TSX Venture Exchange dipped 5.45 points to 580.40 while the TSX Gold Index fell 2.13 points to 224.37. Most Canadian gold miners strayed little from Wednesday’s close. One exception was Guyana Goldfields Inc.(GUY), which rose 15 cents to $1.16 on 3.22 million shares. The company produced over 37,000 ounces of gold in the second quarter and its cost reduction plan appears to be going well.

Phillip Walford’s Marathon Gold Corp. (MOZ) is growing its Leprechaun. Marathon added one cent to $1.16 on 417,000 shares today on new assays from its Valentine Lake gold project in Newfoundland. The assays, from a series of infill holes along the Main zone corridor at Leprechaun, ranged as high as 4.24 grams of gold per tonne over a true thickness of 59.2 metres. Other noteworthy hits included 3.59 grams per tonne over a true width of 24.8 metres and 6.94 grams per tonne over 19.2 metres.

Mr. Walford, president and chief executive officer, says the 2019 program at Leprechaun, now nearly complete, has succeeded in “stitching together the high-grade areas” of the Main zone. There will be no rest for the drill crews, as the company has already resumed work at the Marathon deposit. Mr. Walford has found plenty to cheer about ahead of a resource update for Leprechaun, which is expected in September. He says that the wide intersections of high-grade gold will assist in lowering the overall strip ratio of a Leprechaun open pit. (The company’s previous drilling and stitching at Marathon accomplished much the same thing there last year.)

At last report, Valentine Lake held 44.3 million tonnes measured and indicated at 1.79 grams of gold per tonne and 24.4 million tonnes inferred at 1.57 grams per tonne, yielding nearly 3.8 million ounces amenable to open-pit mining. (Another 435,000 ounces at higher grades can be mined from underground.) Leprechaun currently accounts for nearly one million of those open-pittable ounces, while Marathon hosts the bulk of the Valentine Lake resource, at nearly 2.6 million open-pittable ounces.

A preliminary economic assessment, completed last fall, calls for a $355-million mine running at 18,000 tonnes per day for just over 12 years, with half of the ore to be milled and the rest to be processed by heap leaching. The dream sheet calls for an average of 225,000 ounces of gold per year, enough to support a discounted net present value of $493-million after taxes. At the time, Mr. Walford and his crew said there was room for further improvements ahead of the planned prefeasibility study this year. Mentions of that study have dropped off considerably, but the company’s recent presentation now lists a delivery date around the start of next spring.

The Mississauga-based Mr. Walford, who has been running the company and its predecessors since the early 2000s, currently draws a salary of $250,000 per year. He also collected a $125,000 bonus in 2017 for the big increase in the Valentine resource estimate. He got no bonus last year, suggesting the company has come to expect the steady growth in the ounce count at Leprechaun and Marathon. Investors certainly have: Marathon’s stock has zigzagged higher since it bottomed at 65 cents last fall.

Shawn Ryan and David D’Onofrio’s White Gold Corp. (WGO) is cheering news of new gold trends identified from sampling near its Vertigo discovery on the JP Ross gold project in Yukon. White Gold, unchanged at $1.29 on 546,000 shares, says that the new trends were identified across its Stage Fright, Sabotage, Topaz and Vertigo targets. (One can only smile at the mindset of those charged with naming the targets.) The enthusiasm is based on surface sample assays of up to 94.4 grams of gold per tonne.

Mr. D’Onofrio, president and CEO, says that he and his crew are “very excited” by these newly-discovered trends that confirm additional near-surface gold mineralization at JP Ross, and which show “many similarities” to the Vertigo discovery. Vertigo still does not figure in White Gold‘s resource estimate, updated last month. The company now lists 14.33 million tonnes indicated at 2.26 grams per tonne and 10.7 million tonnes inferred at 1.48 grams per tonne, a total of over 1.5 million ounces. Over 1.25 million of those ounces reside within the Golden Saddle area, the rest at Arc, and nearly all the resource is amenable to open-pit mining. Vertigo, and perhaps the new gold trends, could add to those tallies with further drilling.

The Toronto-based Mr. D’Onofrio, who has been with the company since 2015, currently receives a reasonable $84,000 annual salary, although he did pull in an additional $60,000 last year as a cash bonus. So did Jodie Wilson, vice-president of exploration, although his salary is a heftier $180,000 per year.

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