Metalicity Share Price Stagnant on More High-Grade Gold (ASX:MCT)

Metalicity Share Price Stagnant on More High-Grade Gold (ASX:MCT)

Metalicity Ltd’s [ASX:MCT] share price is back on the radar again as news of new high-grade gold finds fail to excite once again.

Last week I discussed what could be behind investors lack of enthusiasm with this stock.

Now that there have been a few developments at the Kookynie project, we have a bit more information to tell us what’s going on.

At time of writing MCT shares are down 3.33% to trade at 2.9 cents per share.

With the share price shedding nearly 14% on their last announcement, it will be interesting to see how the share price reacts today.

Another ‘outstanding’ result

If you’ve been following gold explorers recently then you would have seen similar phrases pop up in almost every ASX announcement.

In my opinion, it is becoming increasingly difficult to tell if the share price or the company should be the one to decide whether a result is ‘outstanding’.

Last week we looked at whether high expectations were responsible for the drop in MCT’s share price.

Though this may still be the case, there could be more to it.

Results may not be as ‘outstanding’ as described.

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Discovering McTavish and Leipold

Last week we got a taste of what the mineralisation looked like a the Leipold prospect.

Drilling seemed to indicate that the grade of gold mineralisation tapered away moving further south from the exiting open pit.

The latest round of results appears to back up this assumption.

ASX MCT Gold Discovery - Metalicity Shares

Source: Metalicity

The darker shade of orange is the most recent drill results.

The results do indicate high-grade gold mineralisation close to the surface.

Both good things.

Though we already knew this.

Which might explain lack of excitement in the share price.

However, this is all part of the discover process.

Exploring takes time and must be thorough.

Metalicity Tavish Gold Prospect Long Section - ASX MCT

Source: Metalicity

We can notice a similar trend at the McTavish prospect too.

What might have some concerned in the number of drill holes that failed to return significant mineralisation.

Phase One of the drill program included 44 drill holes.

12 of those 44 holes returned no significant intercept.

That’s just over a quarter of all holes drilled.

While it is still early days, you can see how such a detail could be worrisome.

Overall, there has been 63 holes drilled for 48 significant intercepts — that’s nearly a quarter missing.

In all fairness, sometimes there has to be failures in order for us to learn.

In fact, they can be just as informative as successes.

What could be of concern to more eagle-eyed investors is that there is no detailed explanation for the in significant drill results.

Only they did not return a result — concerning because it indicates the absence of gold.

In contrast, fellow gold explorer Musgrave Minerals Ltd [ASX:MGV] notes the reasons for its drill holes missing their mark.

For example, MGV noted for several drill holes they had did not calibrate the direction correctly.

MCT’s Phase Two of drilling is scheduled to begin on 20 July.

The phase plans to test the deeper extensions of the two prospects, which could give us a better sense of the mineralisation at Kookynie.

We’ll be sure to keep you updated with developments from some of Australia’s most interesting gold explorers and miners. In the meantime, make sure you subscribe to The Daily Reckoning Australia. It’s a great way to stay ahead of the curve when it comes to Australian gold stocks. It’s free too. Subscribe here.

Kind regards,

Lachlann Tierney,

For The Daily Reckoning Australia