Spanish Mountain Gold (TSXV: SPA; US-OTC: SPAZF) is infill drilling its flagship Spanish Mountain gold project in British Columbia. The company is targeting near surface areas of the project's First Zone to upgrade from the inferred to the measured and indicated categories.
Highlights from the program include 1.76 grams gold over 27 metres from 24 metres downhole and 0.82 gram gold over 67 metres from 4 metres downhole.
The company hopes the drill program will positively impact the preliminary economic assessment it tabled for Spanish Mountain's First Zone in 2017. It says the study treated the projects inferred resources as "waste," and therefore "artificially inflated" the project's strip ratio and operating costs.
The study assigned Spanish Mountain a $482 million after-tax net present value at a 5% discount rate and a 19% after-tax internal rate of return. It said the project could produce 2.2 million oz. gold and 1.5 million oz. silver over a 24-year mine life. It gave the project a 1.44 strip ratio and a US$792 per oz. gold cash cost.
As of an October 2016 resource update, the Spanish Mountain contains 306.5 million measured and indicated tonnes grading 0.39 gram gold and 0.64 gram silver for 3.88 million oz. gold and 6.28 million oz. silver across both its First and Second Zones. The project also contains 450.6 million inferred tonnes at 0.28 gram gold and 0.61 gram silver for 4.11 million oz. gold and 8.9 million oz. silver.
Shares of Spanish Mountain are currently trading at 5 ? with a 52-week range of 4 ? to 14 ?. The company has an $11 million market capitalization.