Strickland Metals (ASX: STK) has delivered “outstanding” initial results from the first two diamond drill holes sunk at its Palomino prospect near the Western Australian desert town of Wiluna, with a solid 17m hit grading 10.6 grams per tonne gold from 144.7m.
The impressive intercept contains a 3.5m section going 15g/t gold from 150.1m, while the second hole returned 13.7m at 6.3g/t from 133.4m including 3m reading an eye-catching 20g/t from 133.9m.
Strickland has designed a comprehensive diamond and reverse-circulation (RC) drill campaign to gain structural and geological understanding of the mineralisation at its great Yandal gold project, with a key focus on its central Horse Well gold camp. Located about 85km north-east of Wiluna, the Palomino prospect has been a major drilling priority for the company after it delivered a 39m hit at 6.1g/t gold from just 25m including 22m at 22.2g/t from an initial air-core (AC) campaign in September last year.
Management says Palomino shows excellent potential for being able to expand the mineralised footprint at the prospect, with the main shear structure interpreted to continue for at least 400m north of the existing mineral resource that hosts more than 930,000 tonnes grading 2.29g/t gold for 68,300 contained ounces.
The two holes have exceeded expectations in terms of both grade and width.
Strickland Metals chairman Anthony McClure
The latest assays will provide key structural, geological and mineralogical information for the target as previous data was limited, with the majority of historic drilling conducted in the 1990s utilising either rapid air-blast (RAB), AC or RC methods. Follow-up drilling will progressively target down-dip and down-plunge extensions to the resource to test for underground mining potential.
Assays are still pending for a further three diamond holes, in addition to five RC holes sunk at Palomino.
Prior to receiving these assays, the Company was encouraged by these holes given the abundant visible gold observed in the drill core. The two holes have exceeded expectations in terms of both grade and width.
Strickland Metals chairman Anthony McClure
McClure believed there was a “strong possibility” that historic drilling may have under-represented the gold grade due to ground conditions, sample loss, water and other complications. He expected assays set to be delivered in the coming weeks would confirm that sentiment.
The Horse Well gold camp hosts a current mineral resource of 5.77 million tonnes at 1.4g/t gold for 257,000 ounces and includes 109,000 gold ounces at the company’s Dusk ’til Dawn deposit.
Management says it remains well-funded for its ongoing exploration at Horse Well following its success at the nearby Millrose gold project that it sold last year to neighbouring mining giant Northern Star Resources.
The company raked in an initial cash deposit of $2 million from Northern Star for Millrose, before netting an additional $39 million in cash and was also issued 1.5 million fully-paid ordinary shares from the high-profile buyer. At the end of the March quarter, Strickland held a tidy sum of about $51.4 million in cash and Northern Star shares.
Buoyed by its latest results and with a string of further assays to come, the company is continuing to test its Horse Well area and expects to release a consistent news flow in the coming weeks and months.
It is also planning a detailed drill campaign at its Rogonza project in Serbia where it holds a 5.4 million-ounce gold equivalent resource that consists of 2.96 million gold ounces, 214,000 tonnes of copper and 364,000 tonnes of zinc from just two of four drill-defined deposits.
However, Strickland’s latest assays at Palomino show its earlier AC campaign was no fluke and places the company in a positive position to potentially replicate its Millrose success at Horse Well.
And the market appears to agree, with Strickland’s shares lifting more than 18 per cent during this morning’s intraday trading to touch a high of 11.5c from a previous close of 9.7c and with more than 7 million shares changing hands.
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