Condor Gold (LON:CNR) has moved several steps nearer proving its La India acreage in Nicaragua is part of a sizeable mining district.
Already boosting a 2.31mln resource at healthy grade of 4.0g/t, scout drilling has pointed to promising mineralisation at the Cacao target.
The evidence also points to the prospect lying at the top of an epithermal gold system.
Mark Child, chief executive, said that it was making progress in proving up the scale of opportunity at La India, adding the vein at Cacao is comparable to some of the best intersections found previously.
“It is important to emphasise that Cacao is at the top of an epithermal gold system, preserved because the regional Highway Fault drops down the entire system towards the southeast.
“The Cacao vein is open down dip and along strike with signs of being substantially bigger and is prioritised for further drilling to expand the mineral resource.”
100,000 ounces per year the target
The aim for Condor at La India is to bring on stream a mine producing 100,000 ounces a year through a 2,800 tonnes per day processing plant.
Some heavyweight mining names have come on abroad recently to help expedite the process.
Heavyweight backing for Condor
Well-known Canadian mining investor Ross Beaty, for example, has built up an 8.74% stake through backing a couple of fundings and it is the last of these that is paying for the current drill programme.
Top mining investor Sprott is also on the register and North American investors are likely to play a key part in the next stage of Condor’s development.
One hurdle that was cleared in December was the end of a dispute with its neighbours over royalties on the La India licence.
Under the settlement now agreed, Condor will pay a net smelter royalty (3%) on any gold produced from 90% of the La India acreage.
In addition, Condor agreed to buy 3,508 hectares of land rights from B2Gold covering the mine site infrastructure and mineral deposits.
“The purchase of the land surface rights removes an obstacle to construction, not least because B2Gold undertook litigation against Condor in Nicaragua in relation to these rights, Child said.
Cross-trade in North America
AIM-listed for eleven years, Condor is to set up a US trading facility to boost exposure and liquidity among US investors.
Child said it made sense to cross-trade in North America when Condor's flagship asset is in Nicaragua, Central America.
He believes the plan to establish a major gold district will resonate with a new pool of capital in the US that invests in gold exploration and development companies.
At 68p, Condor is valued at around £42mln.