Dalradian Resources Adds Irish And Norwegian Assets

We recently visited Dalradian Resources’ (DNA.TO) Curraghinalt gold deposit in Northern Ireland. Since 2010, DNA has drilled 20,562m and it has an NI43-101 compliant resource of 2.7moz. An additional 57 holes totalling 15,677m have recently been drilled and are not included in the 2011 resource estimate. Although c 83% of the resources are in the inferred category, the Curraghinalt mesothermal gold deposit remains open at depth and along strike. DNA’s latest step out holes, located 1,700m along strike, have intersected gold mineralisation grading up to 23.62g/t over 1.5m. With a recent PEA for the Curraghinalt deposit and highly prospective precious and base metals concessions in Norway, DNA is poised to benefit from higher commodity prices.

Gold in the Emerald Isle
The Curraghinalt deposit comprises at least 10 gold-bearing quartz-carbonate veins ranging from 0.3m to more than 2m in width. An initial PEA released on 25 July 2012 indicates an IRR (after tax) of 41.9%, based on 145koz pa with an initial capex of US$192m assuming US$1,378/oz for the 2.7moz resource (83% inferred). There are several high-grade outliers within the additional 15,677m drilled, which will be added to a revised resource estimate in 2013. DNA has a water discharge permit for underground drilling and is working on the planning and permitting for the underground development. DNA expects to have an underground development permit by H113.

Other Dalradian concessions
DNA also has c 1.7m ha over six areas covering three greenstone belts as well as a historic silver mining district in Norway. DNA has conducted a systematic till sampling programme over the Kautekeino greenstone belt and stream sediment surveys from Kongsberg (a historic silver mining district) in southern Norway. Drilling of high priority targets is currently underway.

Valuation: EV/resource of US$41.9/oz
Dalradian currently trades at US$41.9/oz. We believe this reflects, among other things, the 15,677m not included in the current resource estimate as well as the highly prospective properties in Norway, which do not have a compliant resource.

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