Kalamazoo delivers impressive gold drill results with more to come
Published on: | by Trevor Hoey
Western Australian-based mining group, Kalamazoo Resources (ASX: KZR) has released some impressive results from its maiden drilling campaign at the company’s flagship Snake Well gold project.
The project is located 450 kilometres north of Perth in the Midwest region and consists of five granted mining leases, one granted exploration licence and two exploration licence applications. It includes a 45 kilometre prospective strike length of the Tallering Greenstone Belt in the western portion of the Murchison Domain.
This has proven to be a strong yielding base and precious metals region, hosting a number of significant deposits including Golden Grove (copper-zinc) and Deflector (copper-gold), as well as pure gold projects such as Mt Magnet, Big Bell and Cue.
However, Kalamazoo is an early stage play and investors should seek professional financial advice if considering this stock for their portfolio.
Focusing on the drilling results released today, impressive intersections included two widths of 2 metres grading 9.54 grams per tonne and 4.35 grams per tonne gold from 62 metres and 24 metres respectively. There was also a 5 metre intersection grading 3.2 grams per tonne from 25 metres.
Drill results confirm historical data
Not only are these results encouraging when looked at in isolation, but they also have assisted in confirming historical drill results which will assist KZR in planning future drilling.
The company has now completed a maiden 75 hole reverse circulation and diamond drilling program spanning 1.2 kilometres. This drilling is part of an overall program to complete development studies at the A-Zone section of the project in preparation for a feasibility study.
Should this lead to a decision to mine, KZR is well-placed as the ore can be processed through the Minjar Gold processing plant as part of the ore sale and purchase agreement which was negotiated in January. In terms of the agreement Kalamazoo receives 60% of the free cash flow from processing.
Management noted that mineralisation is open at depth in fresh rock, as also indicated in historical drilling. With 70% of the drill results still to come to hand there is the potential for multiple share price catalysts, particularly given the fact that today’s results have been favourably received by the market.