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Dacian Gold Limited (ASX:DCN) has announced its strong drilling results on 21st February 2019, which marked potential for significant growth in the Mineral Resource and Ore reserve at Mount Morgans Gold Operation (MMGO), company's 100% owned operations in Laverton, West-Australia. The results which came from Westralia, Cameron Well and the new Basin Margin Prospect marked a continuity and presence of high-grade mineralisation outside the Ore reserves and mineral resource in both the provinces.
As per the Dacian's Executive Chairman, Mr. Rohan Williams, the recent results pointed towards the accelerated exploration program, launched last year, and provided concrete evidence that the program has been on track to establish a +10 year of mine life with an annual production rate of 200,000 ounces of gold at Mt Morgans.
Dacian Gold has completed approximately 25,000m of drilling since the commencement of the accelerated exploration program, to extend the mineralisation at Westralia and Cameron Well. Also, the company has uncovered a new exploration project at the Basin Margin Prospect, located in the south-west of the new Mt Morgans processing plant.
Drilling Results:
The company undertook approximately 16,000m of new diamond drilling in Westralia, outside the current ore Reserve and Mineral Resource boundary. And as per the company, a significant high-grade intersection returned from wide-spaced diamond drilling from the previously undrilled section (350m x 300m) of the banded iron formation (BIF) between the Beresford North and Allanson Ore reserves, where the company took approximately 10,000m of drilling with 22 diamond drill holes.
The result of the drilling was as 16.15m @ 7.7g/t Au (473.55M), 9.55m @ 6.4g/au from 500.25m, 5.90m @ 7.0g/t Au from 565.65m, 6.00m @ 7.8g/t Au from 447.0m, 6.25m @ 5.1g/t Au from 468.75m, 4.85m # 4.4g/t form 468.0m, 2.75m @ 6.2g/t Au from 498.95m, 2.80m @ 6.4g/t of Au from 479.2m and 7.50m @ 3.1g/t Au from466.5m, from its 22 drilled holes between Beresford North and Allanson Ore reserves.
High-grade intersections returned up to 300m north of the Allanson ore reserve, where 17 broad-spaced diamond drill holes for 6,000m were drilled. The results include:
3.0m @ 33.0g/t Au from 493.0m, 3.1m @ 5.4g/t from 248.0m and 5.8 @ 2.6g/t Au from 228.2m.
The company also received good results from its Cameron Well, in which infill and extensional drilling indicated and Inferred Resources, which has a potential for further Mineral Resource Conversion with better results. The results were as 2m @ 11.8g/t Au from 108m, 12m @ 3.8g/t Au from 123m, 4m @ 4.2g/t Au from 98m.
The company previously announced its commercial production results on 9th January 2019.
Financial metrics:
As per the company's recent announcement (made on 30th January 2019), the company had a cash and cash equivalent of A$85.6 million, and a debt of A$ 133.5 million as on 31st December. The hedge book of the company also increased to 158,249 ounces at A$1,756/oz though to the end of FY2021.
Stock movement:
The share price of DCN started an up-rally from the bottom of A$1.985 (made on 7th December 2018) and made a high of A$ 2.720 (on 4th January 2019) and made a recent high of A$2.780 (on 20th February 2019). During the time of writing this report, the share is hovering around A$2.750 (as on 21st February 2019 02:45 PM).
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