Gateway Mining Share Price Takes Off with ‘Significant’ Gold Discovery
The share price of gold and base metals explorer Gateway Mining Ltd [ASX:GML] has exploded today upon the discovery of ‘significant high-grade gold’ at its Gidgee Gold Project in WA.
GML shares began gathering downwards momentum in early September as results from Gidgee failed to impress investors.
However, the GML share price hinted at a change in direction at the beginning of November when the company announced it had expanded one of its prospects into a 2.5 kilometre-long gold corridor at Gidgee.
At time of writing, GML shares are up 55.56% or 1-cent to trade at 2.8 cents per share.
Scale was never fully realised
As we’ve been given plenty of drill results from Gidgee, you might be wondering what did we learn today that would cause the share price to jump so drastically?
In short, today’s results provide evidence of mineralisation on a scale larger than what previous drilling has indicated.
The results come from between GML’s Whistler and Montague deposits, with strong high-grade mineralisation intersected across several significant structures.
Montague currently has an inferred resource of 1.7Mt at 2.18 grams of gold per tonne (g/t) for 120,000oz.
But the new drill results could mean the deposit could be in for an upgrade sometime down the track.
Highlights from the new discovery include:
- 15 metres at 3.0g/t from 104m and 10 metres at 9.2g/t Au from 140m
- 10 metres at 2.5g/t Au from 114m
These newly identified thick, high-grade mineralised intersections are from drilling spaced approximately 150 metres along strike, which could indicate a very large structure.
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In terms of the wider project, GML interpret these results that the entire ~8 kilometre-long western margin of the Granodiorite (see figure below) represents a large-scale gold system.
Source: Gateway Mining
Will this mean a change in share price trajectory?
Today’s results have given investors a better idea of the scale of the mineralisation contained at Gidgee.
It has also given GML some tantalising targets to follow up.
GML’s Managing Director Peter Langworthy, said:
‘We still have a lot of drilling results to be returned from this drilling program, which is on track to wrap up by the end of the month, and we are very much looking forward to receiving the balance of the results on a progressive basis over the coming weeks up until Christmas and into the New Year.
‘We consider this to be a major exploration breakthrough for the Gidgee Project. These results tell us that we have the right exploration model in place, and we are now in a position where we can effectively target key positions across the broader Gidgee Project with confidence.’
Of course, the direction of the share price will depend of the quality of results we see over the coming weeks and months.
But if they continue in much the same way we’ve seen today, then we could see a more tangible uplift in share price.
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For The Daily Reckoning Australia