Mako Gold Ltd (ASX:MKG) has received a speculative buy rating from Blue Ocean Equities along with a price target of $0.28 ahead of its maiden mineral resource estimate (MRE) at the flagship Napié project in Côte D’Ivoire.
The West African explorer has continued drilling over the past two years despite COVID delays and has had ongoing success which will lead to a first resource estimate for Napié expected this month.
Mako shares previously closed at $0.083 and analysts at Blue Ocean believe that the upside potential could be multiples of the current share price.
Share price chart.
Following are the excerpts from Blue Ocean Equities’ research report:
Promising West African gold explorer
West Africa has been the most prospective gold exploration region in the world over the past 15 years with a huge rise in resources and production.
Mako Gold has a management team with previous success. It is exploring its promising gold discoveries at its Napié Project in Côte D’Ivoire.
It has continued drilling over the past two years despite COVID delays and has had ongoing success which will lead to its first resource estimate in June.
Drilling confirms gold discoveries
Napié is Mako’s flagship project in Côte D’Ivoire covering a strike length of 30 kilometres of a major fault structure in Birimian greenstone.
Mako identified gold anomalies in soils extending over 23 kilometres adjacent to the fault.
The major focus has been in the south of the project: on the 2-kilometre-long Tchaga prospect and the adjacent 4-kilometre-long Gogbala prospect where drilling has continued to intersect multiple thick, gold-bearing quartz-pyrite lodes extending along the shear zone.
Preliminary metallurgical tests on the Tchaga core in fresh rock confirmed the gold is free milling.
Multi million-ounce potential
Mako has completed drilling of 49,000 metres (both RC and diamond core) at Tchaga plus 34,000 metres at Gogbala. Drilling is quite shallow with the deepest holes at Tchaga to 200 metres and at Gogbala deepest holes are to 150 metres.
Tchaga displays multiple stacked lodes with many thick intersections. Gogbala looks narrower but extends over 4 kilometres with good continuity.
While we would expect an initial resource estimate of 600,000-700,000 ounces, both deposits are open along strike and at depth and there are some gaps to infill, which offers potential above 1 million ounces.
In addition, there are two strong gold in soil anomalies at Tchaga North and Komboro which are hardly tested.
Latest high-grade hits at Gogbala
Latest drilling from Gogbala intersected gold in 40 of 49 holes, best: 11.2 metres at 7.4 g/t, 13 metres at 3.3 g/t, 11.2 metres at 3.2 g/t, 6 metres at 6.7 g/t and 5.1 metres at 3.8 g/t, 6 metres at 6.7 g/t, 6.5 metres at 5.0 g/t, and 14 metres at 1.9 g/t.
Strong hits at depth were encouraging. We think Mako is on the threshold of a commercial gold project. More drilling is needed but that will come over the next year along with early feasibility studies.
New targets drilling now
Drilling commenced on strong geochemical target areas at Tchaga North with immediate success with a hit of 4 metres at 101 g/t in aircore drilling!
Started 2700 metres RC drilling at Komboro targeting 9 kilometres of artisanal gold pits.
Also, RC drilling has started at the Korhogo project on strong gold in soil and auger anomalies.
We think the stock is cheap ahead of its maiden resource estimate and further likely drilling success. The upside potential could be multiples of the current share price.