Gold Co. Targets High-Grade Veins In Nevada Drilling Program
Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) has started its 2024 drilling program at its wholly-owned Aura gold and silver project in Nevada. Find out why one expert's money is "on this team and their prospects."
Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) announced the start of its 2024 drilling program at its wholly-owned Aura gold and silver project in Nevada.
The 4,000-meter campaign will target the high-grade veins identified in the Jarbidge rhyolite east of the Gravel Creek deposit, where 2023 drill results provided a "breakthrough" showing a significantly expanded resource, the company said.
"In 2023, we identified a corridor of high-grade mineralization immediately adjacent to the Gravel Creek resource," said Western Exploration Chief Executive Officer Darcy Marud. "Since the discovery of Gravel Creek in 2013, 19 drill holes have intersected significant grades and widths of this high-grade mineralization in the corridor. The 2024 drill program will focus on connecting these drill hole intercepts with sufficient drill density to add this new area to future Gravel Creek resource updates."
Western Exploration noted that last year's drilling identified a significant North-South trending/moderately west dipping zone with multiple high-grade gold and silver (Au-Ag) bearing quartz-pyrite-marcasite veins, stockwork, and hydrothermal breccias, located 140 meters to 250 meters east/north-east of the Gravel Creek resource area.
Multiple intercepts of more than 20 grams per tonne gold equivalent (g/t Au Eq) in two parallel vein zones and associated splay structures were traced along a dip length of over 200 meters, with drill widths ranging from 0.3 to 4.6 meters, and individual assay grades up to 257 g/t Au and 1,800 g/t Ag, the company said.
This year's drilling will bracket the 2023 discovery section with an 80-meter step out drilling on strike to the north and south, as well as 80 meters up dip.
Industry veteran Jeff Clark, who has taken over Gwen Preston's The Maven Letter as Paydirt Prospector, has written that "there was a buzz" around the company at this year's Prospectors and Developers Association of Canada (PDAC) convention in Toronto around the company and its experienced management.
"Bottom line, we have a proven mine finder who's found strong hints that his company's flagship project has significantly more gold, in a pro-mining jurisdiction," Clark wrote. "Is Western's flagship project about to double in size, and push the resource over 2 million ounces (Moz)? It's a spec, but my money's on this team and their prospects."
Expanding the Resource
The Aura Project consists of three locations in Nevada: Doby George, Gravel Creek, and Wood Gulch. Earlier this year, the company announced that it is expanding the size of the Wood Gulch/Gravel Creek resources area and working toward a resource update and Preliminary Economic Assessment (PEA) for Doby George.
"Past drilling has already outlined very high Au and Ag grades, and this should allow us to connect the dots and expand the current Gravel Creek resource," Marud said in an annual update to shareholders this spring.
Oriented core data from 2023 identified an array of intersecting veins, stockwork, and hydrothermal breccias following steep to shallow northwest-to-northeast trends that mimic the known structural controls of mineralization, the company said.
"The strongest correlation between 2023 holes WG456 and WG457 linked mineralized
structures to a north/north-west trending corridor, with moderate dips west/south-west towards the main GC Fault zone," Western Exploration said in a release. "Multiple legacy intercepts along two sub-parallel veins zones show grades of over 20 g/t Au Eq along a dip length of over 200 meters. Initial drilling in 2024 will bracket Discovery section 500N, with holes drilled along strike and up dip on 80-meter step outs."
The Catalyst: Gold Already in a Bull Market?
Gold hit its highest price ever of US$2,483.35 last week, and many believe it is already in a bull market. It was US$2,408.57 on Wednesday.
Some experts, like Bloomberg Senior Commodity Strategist Mike McGlone, have predicted that it will only be "a matter of time" before gold hits US$3,000.
Brien Lundin, editor of the Gold Newsletter, told Investing News Network in a story published last week that "clearing US$2,400 for good trading a few weeks about that level would be key."
"Eventually, I think we're going to go much higher," Lundin said. "The timing of that is always the hard part. Getting back to where I think we're going to be at the end of this cycle, I think the gold price is going to be somewhere between US$6,000 and US$8,000."
Having a major effect is the increasing role of central banks buying the metal. The World Gold Council's 2024 Central Banks Gold Reserves Survey showed four in five respondents expected reserve managers to increase their gold holdings in the next year, the website reported, according to a report by Stockhead on June 18.
According to analysts at J.P. Morgan, the "bull case for gold remains intact."
Streetwise Ownership Overview*
Western Exploration Inc. (WEX:TSX.V;WEXPF:OTC)
*Share Structureas of 3/27/2024Source: Thomson Reuters and Western Exploration Inc."Gold's resurgence has come earlier than expected, as it further decouples from real yields," said Gregory Shearer, head of base and precious metals strategy at J.P. Morgan. "We have been structurally bullish (on) gold since the fourth quarter of 2022, and with gold prices surging past $2,400 in April, the rally has come earlier and has been much sharper than expected. It has been especially surprising given that it has coincided with Fed rate cuts being priced out and U.S. real yields moving higher due to stronger labor and inflation data in the U.S."
Ownership and Share Structure
About 74% of the company is owned by strategic investors. This includes Golkonda LLC, a syndicate of dozens of high-net-worth investors, which owns about 58% of the company, and Agnico, which owns 16%.
Management and directors own about 7%, and other institutions own about 12%, the company said. The rest is retail.
Western Exploration has a market cap of CA$38.54 million and has 43.8 million shares outstanding. It trades in a 52-week range of CA$1.50 and CA$0.46.
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Western Exploration Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Exploration Inc.Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. They or members of their household own securities of: [COMPANY]. They or members of their household are paid by: [COMPANY]This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.For additional disclosures, please click here.