In a Feb. 9 research report, Laurentian Bank Securities analyst Jacques Wortman reported that according to new drill results from Troilus Gold Corp.'s (TLG:TSX; CHXMF:OTCQB) Troilus project, the "Southwest zone continues to demonstrate good continuity and potential to grow."
Recent drill results are from holes TLG-ZSW20-200, TLG-ZSW20-202 and TLG-ZSW20-203, all part of Troilus Gold's fall-winter 2020 program targeting the Southwest zone. The Canadian exploration company placed this trio of holes in a northwest-to-southeast orientation so that they crossed the West and Main zones.
Wortman presented the results and indicated what they mean for the Troilus project.
Hole 200 encountered a new high-grade zone near surface as well as high-grade intercepts roughly 100 meters (100m) below the pit wall as defined in the preliminary economic assessment (PEA).
Hole 203 intersected mineralization inside and near the bottom of the PEA pit shell along with high-grade intercepts 100m-plus below it.
The analyst make two key points about these results. One is that relative to last month's drilling, they show continuity of high grade and gold mineralization, inside and outside the PEA pit shell. Two, "the intersections of mineralization outside of the PEA whittle pit shells and the potential for the pit shells to expand and the resource base at Southwest to grow further."
"Recall that only about 510,000 ounces of gold were attributable to the Southwest zone in the July 2020 resource estimate due to a lack of drilling, and the contribution to the PEA was also relatively small," Wortman pointed out.
As such, with the prefeasibility study (PFS) scheduled for later in 2021, wrote Wortman, Troilus Gold will prioritize continued drilling in the Southwest zone, aiming to expand it.
Wortman concluded, "We believe the Southwest Zone will grow and that this zone will represent a bigger proportion of the overall mine plan in the PFS, preferably at the front end resulting in a higher-grade profile in the early years."
Laurentian has a Buy rating and a CA$3.80 per share target price on Troilus Gold. The stock is now trading at about CA$1.07 per share.[NLINSERT]
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures from Laurentian Bank Securities, Troilus Gold Corp., February 9, 2021
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