Drilling at the Antenna target on Premier Gold Mines' (TSX: PG) McCoy-Cove project in Nevada has returned a 119-metre intercept grading 4.12 grams gold per tonne.
Drill hole 19-03R started from 607 metres downhole and includes a 34-metre interval of 5.96 grams gold starting from 692 metres downhole, and a 12-metre intercept of 8.08 grams gold from 703 metres downhole.
Premier plans to twin the reverse circulation (RC) drill hole to further validate the results.
The Antenna target is situated between the historic Cove and McCoy open pit mines that produced 3.3 million oz. gold and 110 million oz. silver between 1986 and 2006.
Barrick Gold (TSX: ABX; NYSE: GOLD) is spending US$22.5 million to earn a 60% stake in the project area, which surrounds Premier's 100%-owned Cove deposit.
Last year, Premier and Barrick completed a $4.4 million program funded by the gold major that included 14 holes and 4,738 metres of core drilling. Earlier this year, the partners then prioritized exploration targets, including Antenna and six other targets.
So far, the 2019 exploration program has completed four RC drill holes in 2,729 metres.
Premier's option agreement with Barrick was signed in January 2018. Barrick must spend US$22.5 million on exploration before June 30, 2022.
The companies describe the Antenna target as a swarm of northeast-striking, northwest-dipping Eocene dikes and faults between the McCoy and Cove mines. "Although many of these features were known to be important primary and secondary controls to mineralization in the Cove and McCoy pits," Premier states in its news release, "they had not yet been tested at depth in the newly drilled area, until now. Furthermore, only a few drill holes have drilled to sufficient depth to intersect the Favret Formation, the favourable carbonate host rock unit, leaving an extended area for further exploration."
News of the intercept sent Premier Gold's shares up 6%, or 9 ?, to $1.62 in mid-morning trading.
Premier Gold's shares are trading in a 52-week range of $1.39 to $3.07. The company has a $341-million market capitalization.
Andrew Mikitchook, a mining analyst who covers the company at BMO Capital Markets, has an outperform rating on the stock and a price target of $4.75 per share.