Underground drill hole TUG-141 has found a remarkable new high-grade feeder zone at Lion One Metals Ltd.'s (LIO:TSX.V; LOMLF:OTCQX; LLO:ASX; LY1:FSE) Tuvatu Gold Project on the island of Viti Levu in Fiji. It is the longest, highest-grade gold intercept to date in the alkaline system, returning 20.86 grams per tonne gold (20.86 g/t Au) over 75.9 meters.
“ ...This high-grade hit is only upside from here.”
— Crescat Capital Geologic and Technical Director Quinton Hennigh
TUG-141 is below the current resource at Tuvatu’s 500 Zone, an intricate network of high-grade structures. It’s also completely inside the boundaries of the company’s mining lease.
Lion One has long planned to start gold production by the second half of 2023 at Tuvatu, and Crescat Capital Geologic and Technical Director — and an advisor to Lion One — Dr. Quinton Hennigh, says the new intercept should not change the company’s course.
Hennigh has seen this kind of intercept before when underground drilling in mid-2017 at the Fosterville gold mine in Australia hit 338 g/t Au over 33.6 meters. The find helped push shares in Kirkland Lake Gold (since bought by Agnico-Eagle) from below CA$5 per share to a peak of about CA$58 in August 2020.
“I have long encouraged our team to find that ‘gold room’ at Tuvatu, and hole TUG-141 leads me to believe they have found it,” Berukoff said in a release.
A closer look at TUG-141 reveals some noteworthy high-grade intervals at different points along the core, including: 138.15 g/t Au over 0.30 meter from 450.9-451.2 meters downhole; 396.16 g/t Au over 0.30 meter from 479.1-479.4 meters; 340.07 g/t Au over 0.30 meter from 498.9-499.2 meters; 600.42 g/t Au over 0.30 meter from 499.5-499.8 meters; 244.37 g/t Au over 0.30 meter from 502.5-503.1 meters; and 230.18 g/t Au over 0.30 meter from 507.3-507.6 meters.
Discovery Hole at 500 Zone
The company has continued to drill deeper at Tuvatu since 2020 when UDDH500 — the discovery hole into what is now known as the 500 zone — intersected 2 meters grading 35.28 g/t Au at 558 meters downhole, followed by 12.7 meters grading 46.14 g/t Au starting at 571 meters.
Hennigh compares drilling an alkaline system to drilling a tree, starting at the top.
“In the shallow part of the system, one finds the upper ‘branches,’ or gold-bearing lodes, but as exploration persists to depth, bigger and bigger ‘branches,’ or lodes, are encountered, ultimately leading to the ‘trunk,’” Hennigh explained.
He added: “If you look at the top of the tree, the footprint of the tree is pretty big. In this case (at Tuvatu), it's several kilometers across. And while it would be nice to think there's one trunk to this thing, it’s a bit disproportionate. So the other thing that popped in my head is that there's probably more trunks down there.”
It took about 10 years, but Placer Dome (before Barrick bought it) found the high-grade Romane Fault Zone at Porgera under a series of smaller lodes. The mine has produced about 25 million ounces (25 Moz) gold since 1990.
“What is most exciting about this discovery is that now that we have a clear idea where the deep fluid-tapping conduit of this system is located, we can effectively chase it to depth, and alkaline gold systems are known to persist to great depths,” Hennigh explained.
Drill hole TUG-141 comes on the heels of some recent promising Phase 2 infill drill results at Tuvatu, a program designed to confirm the size and continuity of the known mineralized lodes, in a section of the orebody slated for early production.
The highlight from the first 11 holes on Zone 5 was hole TUDDH-586, a new discovery that returned 18.47 g/t Au over 1.2 meters between 104.7-105.9 meters downhole, and 584.07 g/t Au over 0.30 meter from 122.4-122.7 meters downhole.
In early May, Lion One filed a prospectus that could see the company raise as much as CA$200 million.
Mining investors tend to follow managers with track records of success. Berukoff is no exception.
Berukoff founded Miramar Mining, which developed the 10 Moz Hope Bay gold project in Canada’s Arctic. Berukoff sold Miramar to Newmont Corp. (NEM:NYSE) in 2007 for CA$1.5 billion. That deal came after Berukoff and his team sold Northern Orion Resources to Yamana Gold Inc. (YRI:TSX; AUY:NYSE; YAU:LSE) for CA$1.07 billion that year.
Reuters reports that Berukoff holds a 13.6% stake; Invesco Advisers Inc. owns 4.6%, Franklin Advisers Inc. owns 4.51%, and Crescat Capital also has a significant position in Lion One.
Lion One has about 156 million shares outstanding and trades in a 52-week range of CA$0.88 and CA$1.34.
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