2nd May 2014 09:03
LONDON (Alliance News) - SolGold PLC Friday said it has terminated Hole 6 at its Cascabel copper-gold porphyry project in northern Ecuador at a depth of 1,401.5 metres.
In a statement, SolGold said Hole 6 intersected a thick sequence of volcaniclastic breccias which were argillic-altered from surface to 471 metres depth, propylitic-altered from 471 to 965.5 metres depth, phyllic altered from 965.5 to 1111.5 metres depth and then potassic-altered with variable phyllic and propylitic overprint from 1111.5 to 1395.4 metres, before ending in intense phyllic alteration to end of hole.
Solgold said it is "clear" that Hole 6 drilled on the margins and to the east of the central zone.
It expected to release results for Hole 6 as part of a further drilling and results update in late May to early June.
Shore Capital's Yuen Low said that the hole represents "an expensive disappointment", illustrating the "difficulties and costs associated with exploring such a deep deposit."
"We reiterate our caution against excessive exuberance in this name. We continue to believe that the market cap remains excessive on results to date and would see instances of price strength as providing profit-taking opportunities," Low said.
SolGold Chief Executive and Managing Director Alan Martin said the second round of magnetic modelling has been a significant step forward for the Alpala Prospect at Cascabel.
"The discovery of high-grade copper and gold porphyry mineralisation to depths of greater than 1000 metres in Hole 5 prompted a detailed review of all exploration data and remodelling of the magnetic data at depth," Martin said in a statement.
"The conclusions from this review point to the presence of 3 targets at Alpala; the Central Zone, which was discovered by Hole 5, the North West Target and the South East Target, which are yet to be drill tested."
"All of these targets, combined, represent the potential for billions of tonnes of copper gold mineralised porphyry, which we will test by drilling in due course. The (induced polarization) survey is anticipated to add another layer of critical exploration data, and we are very excited to be commencing the survey in the next two weeks. Most porphyry deposits have a definite IP signature, and we expect that the IP survey at Alpala will assist with defining the distribution of sulphides that may be associated with high grade copper and gold mineralisation."
SolGold shares were Friday quoted at 8.35 pence, down 8.5%.
By Samuel Agini; [email protected]; @samuelagini
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