Xtract Resources (LON:XTR) has found another small but “significant" concentration of gold near the surface at its Chepica mine in Chile.
The find was at the intersection of two major geological structures at the Salvadori prospect and could contain approximately 1,000oz to a depth of 25 metres (m), worth about US$1mln at current prices.
Last week Xtract reported that high grades in the ore from another small (25m) surface operation at Salvadori were responsible for a ten-fold increase the gold content in the concentrate produced from Chepica sending it share price soaring.
Xtract stepped up its exploration at Salvadori as a result and this latest find is the result of that additional work, it said.
Mining of the new deposit is expected to start within two weeks.
In mining parlance, Xtract said the new reef outcrops on surface and is open to depth, while containing about 5,000t at 5.5 grams per tonne (g/t) to a depth of 25m.
The ore zone was exposed by underground development on level two (25m down) with an average grade of 17 g/t of gold along 17m of drive intersection.
Jan Nelson, chief executive, said he was delighted with the discovery and a mining contractor has been appointed to start planning the extraction of the ore zone from surface to level two.
Ore from this area would be delivered to the mill in May.
A drilling programme to define the mineralisation to depth is also set to get underway soon he said.
“The discovery of this zone and the fact that we can start to mine this zone imminently will benefit the revenue and profitability for the month."
Xtract used the recent increase its market value to raise £3mln to develop Chepica and assess two acquisitions.