Alkane Resources (ASX:ALK) successful drill programme during H119 at the Tomingley Gold Project has resulted in the generation of an exploration target ranging from 860,000oz Au to 1,680,000oz Au. Importantly, this exploration target lies within 8km of Alkane’s operational Tomingley gold processing plant. Successful resource drilling of the exploration target, followed by positive feasibility studies, could extend the life of the gold operations at Tomingley beyond 2022.
Business description
Alkane Resources is an Australian production and development company. It previously produced 70,000oz of gold per year from the open pit operations at its Tomingley gold mine but is now transitioning to underground operations and expects to produce around 32,000oz of gold pa.
The exploration target defined the potential for 15.8–23.8Mt at a grade of 1.7–2.2g/t Au, which theoretically could contain between 860,000oz Au and 1,680,000oz Au.
The exploration target at Tomingley is based on the drilling completed to date at the Roswell, San Antonio and El Paso prospects, which cover a combined strike length of 2,500m. The exploration target does not include the 1km section between the San Antonio and El Paso prospects or the areas to the north of Roswell and south of El Paso which, with further work, could provide additional exploration upside.
While this is an important development for Alkane, it is important to note that the exploration target is conceptual in nature and is, therefore, an approximation. There has been insufficient exploration to estimate a mineral resource and it is uncertain whether further exploration will result in the estimation of a mineral resource.
Alkane has now commenced resource drilling at the Tomingley project, and it expects the 60,000m programme to take around 12 months. Environmental studies, as well as consultations with the relevant landholders and regulatory bodies, are also underway. Alkane’s share price was up 5% on the back of this news.