Golden State Mining Share Price Slips Despite Broad Gold Intervals
The Golden State Mining Ltd [ASX:GSM] share price has continued to tumble today on the release of final assays from its reconnaissance drilling program at its Yule Project in WA.
GSM shares have been in steady decline since coming off their 52-week high in early July last year.
The second half of 2020 was not overly favourable for gold explorers as we saw volatility return to the gold price despite an uptick in global COVID-19 cases.
At time of writing the GSM share price is down 1 cent or 5.56% to trade at 17 cents per share.
Golden State only ‘scratched the surface’ at Yule
Despite the negative share price action today, GSM’s latest announcement seems relatively positive.
Though it appears a drop in the gold price overnight has outweighed any positive sentiment.
GSM now has all outstanding assay results from its phase two reconnaissance drilling program.
GSM’s Managing Director Michael Moore discusses the results:
‘With just over 700km2 of tenements in this exciting region of the Pilbara, Golden State Mining has delivered 28km of air-core drilling during 2020. However, we have only just scratched the surface over a fraction of our tenement package.
‘The first two air-core campaigns have been relatively shallow, first-pass reconnaissance drill testing of selected targets identified solely via the interpretation of the aeromagnetic datasets in a largely untested emerging gold district.
‘Both phases of reconnaissance drilling, especially the first, have delivered encouraging gold and arsenic anomalism along with broad zones of alteration which has endorsed the initial targeting strategy.’
Source: Golden State Mining
GSM recorded composite intervals greater than 0.1 parts per million gold in 20% of holes in the phase two program.
Not necessarily a bad result considering this is across kilometres of drill holes.
This is also reconnaissance drilling, not infill drilling.
So, we expect their will be drill holes coming up empty.
What to make of gold explorers in 2021
The world is still holding its breath for the rollout of the COVID-19 vaccine.
But that is proving to be a little more difficult and complicated than envisioned.
What’s next is to see how equity markets reevaluate the impacts of knee-jerk lockdowns around the world.
Which means we could also see volatility remain in the gold price too.
As for GSM, they have plenty more exploration activities planned for Yule this year.
Their targeted ‘reverse circulation’ drill program should give us a more detailed look at some of their targets identified in reconnaissance drilling.
Results for that program could see the share price get going again — provided the results are positive, of course.
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For The Daily Reckoning Australia