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San Gold Corp. Drills Multiple High Grade Gold Zones, Volume Spikes On Announcement
By: AllPennyStocks.com News
August 26, 2009
It sounds like a line from a cheap Hollywood adventure script, but there is gold in them thar hills! And more companies are finding it and bringing it to market in droves, its world price notwithstanding.
Manitoba, perhaps, does not get its due as a gold-producing province, but Bissett, Manitoba-based San Gold Corporation (TSX-Venture:SGR) may be on the path to changing that, with word in late August of its success in finding confirmed mineralization on its property in the Rice Lake Greenstone Belt in south-east Manitoba. Further drilling and exploration of numerous targets within the Rice Lake mine include a new extension of the high grade "98" vein. One hole yielded 44 gram of gold/tonne over 5.9 metres extending the 98 vein to the west.
One intersection of veins at the 26th and 28th levels included two high grade segments grading 130 g/tonne over a metre and 77 g/tonne over 1.6 metres containing coarse visible gold. San Gold CEO Dale Ginn is quoted as saying, “Our growing database of drill holes and application of our new and successful structural model will allow us to redefine the Rice Lake mine along strike, downward, (and) upward.”
The Rice Lake Gold Project includes two mines: the deep underground, high-grade Rice Lake mine itself and the nearby near-surface, ramp accessed San Gold #1 deposit. Both mines feed the 1,250-ton per day Rice Lake mill which will be expanded to 1,900 tons per day by the end of this year.
SGR also owns or controls nearly 15,000 hectares of exploration lands along the Rice Lake Greenstone Belt, and has increased its ore resources and reserves from 550,000 gold ounces when it acquired the Rice Lake Project in 2004 to over 1.6 million gold ounces by the end of 2006.
The only drawback, for now, is that expenditures are dwarfing the revenues, as is usually the case with such a young company.
The first fiscal half of 2009, which ended in June, showed a six-month loss of $19.3 million for San Gold, but which compares favourably to a $23.7-million loss in the first half of 2008.
The stock felt the bruises at the onset of the current recession, and bottomed out last October at 57 cents. The price has since vaulted to a 52-week high of $3.01, a peak it achieved at the end of July, before cooling off a mite to a reading around $2.80. The price’s proximity to that peak puts a special urgency on investors to look in on this stock, as San Gold continues to find what it’s looking for in an underrated area for gold.
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