Liberty Gold Corp. (LGD:TSX; LGDTF:OTCQX) keeps adding and upgrading ounces at its Black Pine oxide gold project in Idaho ahead of the prefeasibility study (PFS) expected next year, reported PI Financial analyst Chris Thompson in an Oct. 31 research note.
"With numerous zones of mineralization open, we anticipate Liberty to continue expanding [the] mineralized footprint whilst upgrading ounces with infill drilling," Thompson wrote.
227% return projected
Thompson noted Liberty has a price now of about CA$0.26 per share and potential for it to move up. In fact, PI's target price on the Canadian gold explorer is CA$0.85 per share.
"With Liberty trading at about 0.14 times net asset value, we see significant value upside as it advances Black Pine to a preliminary economic assessment/PFS stage of development," Thompson wrote.
The difference between the current share price and the target price reflects a material return for investors, of 277%.
PI rates Liberty Buy.
New drill data
Thompson summarized and provided highlights of the just-released results from Black Pine. Data are from 39 holes spread over three zones: Back Range, Rangefront and M.
Overall, results were positive. All of the zones returned gold mineralization and remain targets for additional drilling.
Back Range: In this zone, Liberty tested new areas of mineralization to the north and west. Among the results, hole LBP1005 stood out. A notable intercept from it was:
- 0.42 grams per ton gold (0.42 g/t Au) over 68.6 meters (68.6m) starting from 0m, including 1.08 g/t Au over 3m
"The northernmost hole (LBP1005) returned impressive grades, and mineralization remains open," Thompson wrote.
Given these results, Liberty plans future stepout drilling to expand the mineralization around LBP1005.
Rangefront: Of the 39 holes on which Liberty just reported data, 15 were placed in this zone. They confirmed that the high-grade gold mineralization discovered recently extends laterally. The new infill drill data from Rangefront will go towards converting Inferred ounces to Indicated ones.
"This zone remains a key target for 2024 resource expansion drilling," wrote Thompson.
M: Results from this zone outlined an 800m by 400m area of mineralization containing grades "notably higher" than the average grade of the existing resource, Thompson relayed. Highlight intercepts included:
- 0.62 g/t Au over 30.5m, including 1.23 g/t Au over 1.5m (hole LBP982)
- 0.63 g/t Au over 18.3m, including 1.24 g/t Au over 6.1m (hole LBP987)
"Liberty sees the M zone as offering future potential for early gold production at heightened grades," Thompson reported.
PFS steps taken
In addition to drilling, Liberty has been doing other work to support the upcoming PFS. Recently, the company submitted the mining pre-plan of operations for Black Pine. It also contracted the services of an engineer to lead the study.
What to watch for
Investors should expect continuing news from Liberty as it continues advancing Black Pine.
By year-end, the company plans to complete and announce an updated resource estimate for the project. The ensuing PFS is slated for completion next year.
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