Close

Welcome back to Stockhouse
Member Sign In

Email or Username:
Password:
Close

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Enter your email address:
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

Lassonde says gold find could be among richest in B.C.

Peter Kennedy Peter Kennedy, Stockhouse
1 Comment| February 1, 2013


In an era when large gold deposits are increasingly hard to find, a Canadian mining executive had some good news for investors in New Gold Inc. (TSX: T.NGD, Stock Forum) and junior companies exploring in the vicinity of the gold miner’s Blackwater project in central British Columbia.

New Gold director Pierre Lassonde said there is an even chance that the Blackwater property and others nearby will eventually rank among the province’s largest gold mining camps.

“There is a 50/50 chance that it will be a 25 million ounce camp,’’ Lassonde told reporters following a speech to the Roundup mining conference in Vancouver Thursday.

As Blackwater hosts a gold resource of just over 10 million ounces, exploration crews still have a long way to go to reach 25 million ounces. When asked to elaborate, Lassonde said his projections are based not only on indicated and inferred resources in the Blackwater zone, but also on additional discoveries on nearby ground, including the nearby Capoose property.

“In between, there is a lot of interesting geochemistry,’’ he said.

Blackwater is the site of a proposed open pit mine that is expected to cost $1.8 billion to develop, producing an annual average of 507,000 ounces of gold and 2 million ounces of silver over a 15-year life span, according to a preliminary economic assessment announced in September 2012.

Its prospects for securing mining permits are thought to be good because of its proximity to Vanderhoof, a logging region descimated by the Pine Beetle infestation.

When reached in Toronto, New Gold spokeswoman Julie Taylor said she was unaware of the 25 million ounce target mentioned by Lassonde, who in addition to his role as a New Gold director is also Chairman of Franco-Nevada Corp. (TSX: T.FNV, Stock Forum) (NYSE: FNV, Stock Forum), one of the gold mining sector’s most successful royalty companies.

 “These are numbers that we can’t comment on,’’ she said.

Still, Taylor said the company is excited about the prospects for Blackwater, and company officials will convey that enthusiasm when they meet with analysts on Tuesday to discuss the company’s production forecasts.

If Lassonde’s predictions are correct, Blackwater would be very large. But it would still rank behind British Columbia’s biggest gold projects.

They are Seabridge Gold Inc.’s (TSX: T.SEA, Stock Forum) Kerr-Sulphurets-Mitchell (KSM) project, which hosts 38.2 million ounce of gold (plus 9.9 billion pounds of copper), and Pretium Resources Inc.’s (TSX: T.PVG, Stock Forum) (NYSE: PVG, Stock Forum) Snowfield project, which contains 25.9 million ounces of measured and indicated gold resources, plus another 9 million ounces of inferred gold.

Snowfield and KSM are both located near Stewart in northern British Columbia.

When reached for comment, B.C. regional geologist Paul Jago described the 25 million-ounce target as “news to me.’’

However, he agreed that the potential for new discoveries in the Blackwater area is significant, especially as New Gold was running one of the most aggressive exploration programs in Canada last year, one that featured 18 drill rigs.

“There is a lot of activity in that area,’’ he said.

Aside from New Gold, active companies include, Parlane Resource Corp. (TSX: V.PPP, Stock Forum), which is exploring between Capoose and Blackwater,  Amarc Resources Ltd. (TSX: V.AHR, Stock Forum), Troymet Exploration Corp. (TSX: V.TYE, Stock Forum), RJK Exploration Ltd. (TSX: V.RJX.A, Stock Forum) (which is exploring the Blackwater East and Blackwater West projects), Independence Gold Corp. (TSX: V.IGO, Stock Forum), and Red Hill Resources Corp. (TSX: V.RHR, Stock Forum).

During his speech to the Roundup conference, Lassonde said the Blackwater project is considered a success story. “It was discovered in 2010 and will probably come into production by the end of 2016.’’

However, he was less optimistic about the short term prospects for gold itself. “The next six to nine months is looking at the same short of channel, US$1,680, plus or minus $100.’’

Lassonde said this is because the U.S. economy and the U.S. dollar is doing much better than the Euro.

“But at some point inflation will raise its ugly head, and when inflation raises its ugly head, you can be sure that gold will be really rocking.’’

On Friday, New Gold shares closed at $10.12, up 4.4%, leaving the company with a market cap of $4.82 billion, based on 476 million shares outstanding. The 52-week range is $12.50 and $7.20.


Tags: INDUSTRIAL METALS & MINERALS GOLD PROPERTY DRILL RIGS

Rate this article
3 stars
v
Usefulness

Clarity

Credibility

Interested in these industries and sectors?

Receive investor kits and email updates from Stockhouse and directly from these companies.

"Consumer Cyclical"
"Industrial Metals & Minerals"
"Metals & Mining"

I consent to receiving investment related electronic messages from Stockhouse and the companies selected.
I may withdraw my consent at any time.

Comments

yoshka2000
Can't backup the statement of 25 mil. Au.?
4 stars
August 23, 2013
Rate this comment
0 stars
v
Usefulness

Clarity

Credibility

Leave a Message

You must be logged in to access this feature.