BMG Resources (ASX: BMG) is preparing to probe high-grade gold zones at its Abercromby gold project in a new round of extensional drilling designed to expand the company’s current maiden 518,000 ounce gold resource at Wiluna in WA.
The program was flagged two weeks ago following the company’s successful $1.5 million capital raise sources from sophisticated and institutional investors. It is now fully-funded to complete expansion drilling at Abercromby and to progress development studies.
Abercromby hosts a maiden mineral resource estimate of 11.12 million tonnes at a grade of 1.45g/t gold for 518,000 ounces of gold, which includes 354,000 inferred and indicated ounces of gold at a grade of 1.17g/t gold extending from the surface.
The underground component of the resource currently includes a separate 164,000 ounces of inferred and indicated gold grading 3.09g/t gold between 200m and 500m below surface.
With its eye firmly set on a path to the earliest possible production, BMG plans to mine a proportion of the near-surface resource by a small open-pit which would be designed to enable access to the high-grade underground gold resource from a portal in the open-pit floor.
The proposed drill program is looking to convert resources from the inferred category to indicated - or potentially better – through comprehensive infill drilling, while extensional drilling will look at expanding high-grade gold zones outside the existing shell of the resource model.
The company already has a Program of Work in place and has selected contractors DDH1 Drilling to sink the holes as it looks to crank up the rig with further drilling planned later this month.
BMG has already demonstrated it can efficiently plan and execute a successful and productive drilling program, with only three previous campaigns being required to produce its maiden resource.
Following the support shown by investors in the recent capital raising, the team at BMG have moved quickly to finalise arrangements to resume drilling at the Abercromby Gold Project. The drill programme will focus on expanding high-grade gold zones beyond the existing resource shell, as well as increasing resource confidence by upgrading inferred resources to indicated status. The results of the drilling have potential to contribute significantly to resource growth at Abercromby, and to materially boost the potential project economics.
BMG’s Non-Executive Chairman John Prineas
That resource is centred on the Capital deposit at the north-east end of the northernmost of BMG’s two mining leases at the project. It forms part of a bigger global resource estimate which contains about 670,000 ounces of gold.
Importantly, the Capital deposit remains open at depth and along strike in both directions, which the imminent diamond drilling will set out to test further.
Additionally, more drilling is planned early next year to evaluate regional targets south of the Capital deposit, following-up on previous reconnaissance air-core drilling at Capital South, Archer and Barrack Prospects.
Those prospects are all spread along a 1km strike of prospective stratigraphy extending south-east along strike from the Capital deposit. The scout work previously conducted confirmed the existence of a big high-grade gold system and supports the possibility of repeat mineralisation similar to the Capital deposit.
The company is confident in its past record and the prospectivity at Abercromby, both of which would seem to promise significant upside with a good chance BMG can materially upgrade and expand its current resource.
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