Gold junior’s shares jump more than 50% on “exceptional” drilling results

Shares in gold exploration minnow Redcastle Resources Ltd (ASX: RC1) jumped more than 50% in early trade on Monday after the company announced “exceptional” gold assays from its Redcastle Reef prospect.

The company said on Monday that the first results from grade control drilling at the prospect had delivered some very high gold results, including a 1m section measuring 3650 grams per tonne of gold at a depth of 15m.

The company did caution that such high results were indicative of “nuggety” gold, which was known to occur at the prospect, and which would be typically cut to a lower value during resource estimation.

Strong grades welcomed

Other results included 7m at a grade of 527 grams per tonne of gold across 7m (including the previously reported section) and 2m at 14.58 grams per tonne of gold from a depth of 24m.

Redcastle said the results were from the first eight holes planned as part of the grade control drilling program, which was being conducted by its joint venture partner BML Ventures.

The company went on to say:

The drilling program at Redcastle Reef is planned to include approximately 12,800m on an 8m x 6m grid and designed to improve grade definition for mine planning and gold production.

Redcastle Resources Chair Ray Shaw said on Monday:

These initial grade control results from Redcastle Reef are highly encouraging, with multiple high-grade intercepts reported over meaningful widths, demonstrating the continuity and tenor of the mineralised system. It is particularly encouraging to see that … grade control drilling is supporting Redcastle’s existing mineral resource estimate (MRE) drilling results. Redcastle Reef has long been recognised for the presence of coarse gold, and these results further confirm that characteristic. Redcastle is fortunate to have access to experienced personnel with extensive expertise in managing coarse-gold mineralisation in the Eastern Goldfields over many years.

Drilling is continuing at the prospect, and new results will be reported as they come in, the company said.

Happy hunting grounds

Redcastle’s portfolio of gold exploration assets is located about 60km east-southeast of the Gwalia gold mine, the company said.

The portfolio comprises a series of contiguous tenements centrally located within a region known as the ‘golden circle’, an area delineated by multi-million-ounce gold mining operations within the highly prospective Leonora-Laverton portion of the greenstone belt of the eastern Yilgarn.

Redcastle shares traded as high as 11.5 cents on the news, up 51.3%, before settling back to be 26.3% higher at 9.6 cents.

Redcastle Resources was valued at $9.1 million at the close of trade on Friday.

The post Gold junior’s shares jump more than 50% on “exceptional” drilling results appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.