FROM THE BROKING DESK
We recently met up with Nick Mather from SolGold (LON:SOLG) when he was in London. He shared with us some of the details on the large copper-gold porphyry that the company has been drilling on its Cascabel Project in Ecuador (85%), as well as giving us an update on the broader land package that it holds in the country. Project-wide geophysics and geochemical surveys over the project area have defined 14 targets, with all of the drilling undertaken to date having been focused on one — Alpala.
Results from Alpala have included Hole CSD-15-012 (announced in October 2015): 1.2% CuEq (0.67% Cu and 0.63 g/t Au) over 1,312m from 128m. Alpala is a significant copper-gold porphyry deposit that is open in a number of directions. Three rigs are currently on site, with plans to increase this to ten by this time next year. Alpala is formed of a cluster of deposits along a mineralised corridor, for which management increased its estimated length to 1,300m in April.
The scale of this deposit has put SolGold on the radar of the majors, with Newcrest Mining holding a 10% stake and Guyana Goldfields 7%. Similarly, its progress has not gone unrecognised by the market, with the share price having increased by over 11x during the last 12 months. The company now has a market cap of US$820m.
Management expects to continue drilling, with the aim of publishing a maiden resource at the end of 2017 and a PEA in mid-to-late 2018. The company plans to drill test the next target, Aguinaga (3km from Alpala), in July this year, with others to follow. SolGold also continues to build its portfolio of properties in the country. Given the scale of the discovery and the extent of exploration upside in what looks like a new district, we expect the stock to continue to perform strongly.