Macquarie Research has chosen Bellevue Gold (ASX: BGL) as its top explorer pick in Australia for 2019.
The junior, which is trading at A$0.495 per share and has a market cap of about US$143 million, is delivering high-grade drill results from its Bellevue gold project in Western Australia.
The company says it has delineated over one million ounces of gold in less than 12 months at a discovery cost of A$15 per oz.
In October 2018, the company increased its inferred resource for the project to 2.6 million tonnes grading 12.3 grams gold per tonne for 1.04 million ounces of gold with the addition of a maiden inferred resource for the Viago lode, which is estimated to contain 550,000 ounces of gold contained within 0.8 million tonnes grading 22 grams gold.
The past-producing Bellevue mine churned out about 650,000 ounces of gold (1.6 million tonnes grading 12.4 grams gold per tonne) between 1986 and 1997 and another 142,000 ounces of gold between 1895 and 1909 (253,000 tonnes averaging 17.4 grams gold).
Resource expansion drilling over the next few months will focus on three areas: extensions to the north and south of the Bellevue underground mine as well as a number of unmined areas near existing underground development; step-out down plunge and down dip drilling in the Viago lode; and depth extensions in the top 250 metres north of Bellevue workings targeting shallow dipping mineralization intercepted in historic shallow broad-spaced drilling.
The company estimates that the Bellevue lode historically produced about 700,000 ounces of gold at about 15 grams gold from underground mining and another 100,000 ounces of gold from open-pit, and believes "a significant amount of mineralized material was left unmined during the previous operation due to the mining of only 'bonanza' style super-high-grade ore shoots and leaving the proximal ore behind."
Bellevue Gold believes there is "significant potential" to extend the known mineralization along strike to both the north and south.
In early December the company reported drill results from the Bellevue Surrounds area (in and around the historic Bellevue underground area), which it expects to bring into the resource category in the first quarter of this year.
Highlights from the drilling include 2.4 metres grading 26.1 grams gold from a depth of 269 metres; 3.9 metres of 16 grams gold from 197 metres; 2.4 metres of 13.1 grams gold from 417 metres; and 1.3 metres of 35.2 grams from 75 metres.
Those results, along with mineralized extensions immediately to the south of the underground workings, "have confirmed the company's view that there is [a] significant amount of high-grade gold mineralization remaining in and around the historic Bellevue underground area," Steve Parsons, the company's managing director, states in a press release.
Parsons, a geologist, was previously managing director of Gryphon Minerals, which he founded and listed on the ASX. Gryphon established the 3.6 million ounce Banfora gold discovery in Burkina Faso. Teranga Gold (TSX: TGZ) took over the company for about $100 million in 2016.
In late October Bellevue Gold raised A$15 million in a private placement to institutional investors of about 45 million shares at A34 ? per share.
Macquarie Research commented in a recent research note that the company is top pick for its exploration potential. The company "recommenced exploration at Bellevue in late-2017 and quickly discovered the Tribune and Southern Belle lodes followed up by the recent high-grade Viago lode (22.0g/t)," its analysts wrote. "BGL is well funded to drill ... and we expect regular resource updates, and potential new discoveries to be key catalysts for the stock over 2019."
"Given its high-grade and close proximity to the sealed highway, we believe Bellevue could displace lower grade ore into almost any regional processing plant. Combined with its large and prospective regional exploration tenements we believe that BGL could make an attractive target for gold miners in the region."