Cora Gold’s New Drilling Campaign Results Adding Value to the Sanankoro Gold Project

 West Africa focused gold exploration company, Cora Gold Ltd (LON:CORA), continues to advance its exciting portfolio of highly prospective gold assets covering a 1,200 sq km area in two world class locations: Mali and Senegal.  The company has a number of permits within its exploration licence area including Sanankoro, Yanfolila and Diangounte. The first two projects are located within the Yanfolila Gold Belt in Mali and the third is in western Mali & Eastern Senegal inside the Kedougou Kenieba Inlier, also known as the Kenieba Window.Â

The Flagship Project - SanankoroÂ

 Key Targets at Sanankoro

(Source- Company Report)Â

First results from drilling campaign successfully intersected multiple higher-grade gold intercepts at Sanankoro – On 11 February 2020, the company published first results from the current drilling campaign at Sanankoro targeting the continuity of mineralisation at depth, in part below the limit of the existing Resource pit shells. Given the current Resource has a range of pit depths from about 40 to 100 metres, the results confirmed that there is significant scope to increase the open pit Resources with further successful drilling.

The results from the first five holes drilled are as follows:

• Hole SC241 has an average ore grade of 2.61 g/t Au over 29m from 82m, which includes ore grades of 3.89 g/t Au over 12m in sulphide portion of the hole.
• Hole SC246 has an average ore grade of 4.2 g/t Au over 7m from 101m, which includes ore grades of 8.38 g/t Au over 3m.
• Hole SC248 has an average ore grade of 2.05 g/t Au over 14m from 61m, which also includes ore grades of 3.31 g/t Au over 7m.
• Hole SC248 has an average ore grade of 1.08 g/t Au over 18m from 84m.
• Hole SC250 has an average ore grade of 1.68 g/t Au over 4m from 137m.

The Scoping Study report and its estimates for Sanankoro - The company announced on 16 January 2020 positive results from an initial Scoping Study, which was conducted on Sanankoro. The Study was overseen by Wardell Armstong International (‘WAI’), which worked collectively with SRK Consulting (UK) Limited (“SRK”) and Digby Wells.

The Study validated the economic potential of Sanankoro and concluded that:

• The project has an Internal Rate of Return (‘IRR’) of 84%.
• It will be able to generate more than US$19 million free cash flow on an average per year.
• The project has a net present value (‘NPV’) of US$30.9 million at 8% discount rate.
• The project has a US$942 per ounce All in Sustaining Cost.
• The project will require US$20.6 million of pre-production Capital Expenditure and will be paid back in less than 18 months. It can produce an average of 45,000 ounce of gold per year.

The above estimates assume gold prices to be at US$1,400 and are based on a 1.5Mtpa heap leach processing.  Since the announcement of the initial Scoping Study, gold prices have surged to over US$1,550 and are showing an encouraging upward trend which would further strengthen Cora’s economic fundamentals and potential returns.

Cora Gold Ltd Stock Trading Performance at The London Stock Exchange

Source – Thomson Reuters (one-year price chart)

The shares of the company were trading at GBX 5.27 on the LSE on 17 February 2020. The market capitalisation of the stock based on the current price was around £7.46 million.

In the past 52 weeks of trading on the exchange, the shares of the company have touched a price of GBX 10.00 on the higher side and a price of GBX 2.70 on the lower side.Â

Outlook

The news flow from the Sanankoro Gold Project has been steady and positive, whilst the Scoping Study report provides an insight into the sound value potential for the shareholders of this project. Â Further drilling carried out at the project could very well add to the current resource of 5.0 million tonnes at 1.6 g/t Au for 265,000 ounces of gold and enhance its tangible value.

Whilst news flow has centred around Sanankoro, investors should remain aware of the company’s other two projects, Yanfolila and Diangounte where work is also planned during 2020. The Yanfolila Project being part of the same orebody, could hold similar economic potential and the same goes with the Diangounte Project Area. Ultimately, the company is aiming to build a standalone mine at Sanankoro and produce gold whilst simultaneously advancing developing its wider portfolio; this looks highly achievable given the exciting assets and the fast pace at which it is moving.