We take a look at what’s driving reserve and resource growth at Lake Shore Gold.
Lake Shore Gold, an Ontario miner, issued a good gold reserve update on Thursday: by key analyst measures it beat expectations. The headline was 29% reserve growth, after depletion.
It was impressive, albeit growth on top of already short-lived reserves. Lake Shore has only about five years of minelife, though, it must be said, it has pushed that minelife out consistently with reserve additions over the years. The grade dropped, slightly, in its reserve update, but ounces grew: to 773,000 ounces gold @ 4.4 g/t Au from 598,000 @ 4.6 g/t Au.
For it, on a day that the spot price of gold was bouncing off $1,150/oz, Lake Shore did well in trading, gaining as much as 1.2% during the day.
But if the reserve growth surprised, a little, the real meat is yet to come. Much more interesting still, at this point, is what Lake Shore can bring in its relatively new 144 Gap discovery, 500 metres from its mining operations at Thunder Creek.
In drilling 144 Gap this and last year, Lake Shore caught some attention and for good reason: The hits have been high grade and broad. Late last year Lake Shore reported as much as 7.18 g/t Au over 24 metres among a number of other strong hits. More recently it has highlighted as much as 5.36 g/t Au over 47 metres. The intercepts have put the discovery at the forefront of Lake Shore’s drilling plans. This year alone it targets 120,000 metres with 6 drill rigs at surface and an underground drift in the works.
Some have suggested the new zone could beef up Lake Shore by ~1 million ounces. This remains the key question for Lake Shore now in the 144 Gap zone – size. That is: how company-growing – reserve wise – could the 144 Gap be for Lake Shore, ultimately?
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