Red Mountain Mining discovers ounce per tonne gold at Batangas, Philippines
Red Mountain Mining (ASX: RMX) is positioned to trade higher after delivering some very promising high-grade grade gold hits from trenching at its Lobo Prospect, giving the potential for more high grade shoots along the mineralised corridor.
Lobo is part of the Batangas Gold Project in the Philippines.
The highlights include a new trench intersects of: 2 metres at
31.1g/t gold (1 ounce/tonne) gold, including 1 metre at 60.2g/t gold.
The new trench (Trench 7) targeted an area below a surface-subcrop rockchip sample result of 15.9g/t gold and 18.7g/t silver.
Adding
to the prospectivity of the area, separate surface sampling delivered
33.5g/t gold, and extended the mineralised vein corridor to 500 metres.
Jon
Dugdale, managing director, commented on the discovery: “The rich gold
grades of the new, at surface, lode discoveries – more than an ounce to
the tonne - highlights the potential for additional high-grade gold
shoots within this mineralised corridor, which may be similar or better
than the high grade Southwest Breccia resource.
“The company has
identified a vein system that now extends over 500 metres and further
trenching, then drilling, is planned to confirm continuity and define
additional high-grade mineral resources to upgrade our current 408,000
ounce resource base.”
The news flow is set to continue to Red Mountain, with further trenching either side of Trench 7 in progress.
There
is also trenching in the vicinity of the 33.5g/t gold boulder sample
location, 200 metres west of the new trench, and in other prospective
areas.
The importance of the trench result is the proximity to
other gold occurrences, and is located 100 metres along strike to the
southwest of the recent Japanese Tunnel drilling.
In recent
months at Japanese Tunnel drilling delivered: 8.7 metres at 4.34g/t gold
from 2.9 metres, including 3.7 metres at 8.6g/t gold; and 3.7 metres at
3.06g/t gold, 2.26% copper from 12.3 metres, including 1.55 metres at
5.97g/t gold, 4.88% copper.
These results partially confirmed the Exploration Target and opened
up potential to extend the mineralised zone to the southwest.
Analysis
The
news flow will continue for Red Mountain in coming months, with an
independent Scoping Study at Batangas to determine the viability and
potential of a mining and processing gold project.
This study
would be based on existing resources that could generate cash flow in
the medium term, with a target completion date in December 2013.
The
importance of the gold discoveries today is that along with recent
drilling, these have the potential to add high-grade resources with high
margins, due to being so close to surface.
Exploration news will
continue in the near-term with trenching in progress either side of
Trench 7, where the 2 metres at 31.1g/t gold was identified.
Red Mountain is also tightening up its capital structure, with the
removal of a stock overhang and buy-back of shares should prove a
turning point for the company.
The removal of stock overhangs stemming from its acquisition of Batangas from Mindoro Resources (TSXV: MIO; ASX: MDO) has being removed, which takes away threat of shares hitting the market.
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