Bellevue Gold another Step Closer, Share Price Up (ASX:BGL)
The Bellevue Gold Ltd [ASX:BGL] share price has reversed its downward trend thanks to the announcement of its maiden indicated gold resource at its namesake mine.
BGL shares hit a recent high not seen since the company was known as Draig Resources as the explorer inches closer to development of its mine.
At the end of June shares closed at $1.18 on the back of strong metallurgical work that suggested low mining costs.
At time of writing BGL shares are up 6.70% or 6.5 cents to trade at $1.035 per share.
Barrick sized resource at Bellevue’s project
Barrick Gold Corp [NYSE:GOLD] offloaded the Bellevue mine to BGL in 2017, citing a lack of economically viable targets.
But since making its first drill hole, BGL has now defined 2.3 million ounces grading 10 grams per tonne (g/t) gold.
The BGL announcement this morning relates to its now indicated resource at the project.
Part of the resource has now been indicated at 860,000oz at 11.6g/t.
In layman’s terms, ‘indicated’ basically means quantity and grade are estimated with sufficient confidence to support mine planning.
There is still another 1.4Moz of gold inferred at the project (which is just a lower level of geological confidence).
However, we can expect at least part of this resource to be upgraded to indicated by December this year, according to BGL.
The lion’s share of the currently indicated resource consists of a high-grade core of 480,000oz at 15.5g/t at the Viago and Deacon lodes.
Both of which remain open in all directions, providing opportunity to grow the known gold body.
Expectations are high
You might think the share price action today is a bit lacklustre considering its behaviour compared to more speculative news.
However, expectations for the Bellevue mine are clearly high.
So, it isn’t that surprising that there hasn’t been a huge surge in the share price just yet.
Underground drilling is set to begin in the second half of this year and further extensional drilling is also planned.
The good news today for BGL shareholders is that they now own an economically viable mine that has close to a million ounces of gold and could have over two million by the end of the year.
Bellevue Managing Director Steve Parsons had this to say:
‘This Indicated Resource and the increases to come will underpin the economic studies on the project, which are now well underway.
‘There is also huge potential to continue growing the overall inventory at Bellevue, where the mineralisation remains open in multiple directions and we have numerous well-established targets, some with known mineralisation.’
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For The Daily Reckoning Australia