Tesoro Resources Share Price Moves on Expanded Ternera Potential
It has been a nervous past few months for shareholders of Tesoro Resources Ltd [ASX:TSO], with the share price handing back a fair whack of its gains made earlier in the year.
Since coming off its 52-week high in August, the TSO share price appears to be searching for its new floor.
This isn’t anything unexpected. However, gold stocks traditionally follow a trend of hitting share price highs during the initial discovery phase.
And then they begin to cool off during the resource definition phase leading up to resource estimates — and eventually development.
At the time of writing, the TSO share price is up 1.89% to trade at 27 cents per share.
More broad gold zones at the Ternera prospect
TSO today released more drilling results from the Ternera prospect at its El Zorro gold project.
The broad mineralised gold zones further expand the Ternera mineralised zone to the northeast and south.
- 5 metres at 0.72 grams of gold per tonne (g/t) from 194.5 metres, including 34.6 metres at 1.29g/t from 207 metres
- 166 metres at 0.57g/t from 166 metres, including 39 metres at 1.22g/t from 277 metres
- 137 metres at 0.51g/t from 306 metres, including 47 metres at 1.00g/t from 389 metres
The width and grading of the mineralisation is on par with what we’ve come to expect from the El Zorro project.
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So, why the pump in the share price today when similar results failed to move the share price last week?
One reason could be that the gold price received a nice little pump overnight.
Another reason is that TSO said the results confirm continuity of a wide mineralised zone to the south and new extension of mineralisation to the northeast.
And mineralisation remains open in all directions.
Meaning TSO has been doing a good job of growing its resource.
TSO managing director Zeff Reeves commented:
‘Another set of solid results from Ternera, demonstrating the continuity of the broad mineralised zone extending to the south and a significant new zone of mineralisation to the north, northeast of the deposit.
‘The additional sampling from hole ZDDH0029 has identified more mineralisation at depth with that hole now returning an intercept over 213.50m, which demonstrates the potential for Ternera to be continuously mineralised from the surface to depth.’
What does this mean for the Tesoro share price?
In my opinion, today’s news won’t play into the share price too much.
TSO is aiming to produce a maiden resource estimate by June 2021, which could mean the share price continues to trend downwards for some time yet.
However, TSO says the resource estimate is contingent on how big the size of the deposit is. The bigger the deposit, the longer it will take to drill.
A good problem to have, but also something to be aware of.
It’s also worth paying close attention to movement in the gold price at the moment. Our resident gold expert, Shae Russell, is tipping Australia to become the new gold epicentre.
If Australia knocks China off the top spot, we could see more attention given to Aussie gold stocks. In her free report, Shae details why this could mean big spikes for Aussie gold stocks and what to look out for. If you’re interested, get your free copy here.
For The Daily Reckoning Australia