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NV Gold (TSX-V:NVX, US:NVGLF) has determined where it will plant the first
drill rig this summer, among a thick portfolio of over a dozen gold projects
in Nevada.
The Slumber property in the Jackson Mountains, located about 50 miles
northwest of Winnemucca, Humboldt County, is approximately 21 miles west of
the Sleeper bonanza epithermal vein gold deposit. The Sleeper mine
(operated by AMAX Gold) produced 1.6 million ounces of gold and
2.3 Moz of silver, between 1986 and 1996.
Slumber
Slumber is one of several high-level epithermal gold systems on a trend
that starts in the Jackson Mountains, runs through the Bilk Creek Mountains
and continues north into Oregon. These deposits, along with the Sleeper,
Sulphur-Hycroft, Goldbanks, Blue Mountain, Sandman, and other precious
metals deposits located along fault-fracture zones of the Northern Nevada
Rift, define an important epithermal province in northwestern Nevada.
The target at Slumber is volcanic-rock-hosted epithermal gold and silver
mineralization. The hope is to find a bonanza-type vein gold
deposit.
Epithermal veins can stretch hundreds of meters deep and are usually
narrow and high-grade. In conjunction with these veins, are large alteration
“haloes” of mineralization made by circulating hydrothermal fluids.
While usually high-grade and close to surface, epithermal gold deposits
are generally low tonnage, unlike Nevada’s three northwest trending belts:
the Carlin, Cortez and Walker Lane trends, which are three of the world’s top
mining districts.
NV Gold picked up Slumber at the end of May through a letter of intent
with the vendors. Of interest to the management team were a number
of observed geological features, including:
- Hydrothermal alteration, principally in the form of
silicification (imbued with the mineral silica), associated with
widespread gold mineralization.
- Mineralized pieces of quartz vein float occurring in an
alluvial-filled valley.
- Two or more gold-bearing zones exhibiting cross-cutting
quartz veining, hydrothermal brecciation, and oxidized pyrite exposed
through and surrounded by alluvium (gravel creek-bed).
Previous exploration at Slumber consisted of 15 shallow,
reverse-circulation holes, drilled on and near silicified outcrops. Seven of
the holes returned anomalous gold intercepts over thicknesses ranging from
1.5 to 32m. Rock chip samples collected from the outcrops held gold values up
to a gram per tonne, plus elevated concentrations of silver, antimony and
other gold pathfinder elements.
Seeing the potential for a drill program, NV Gold set about gravity and
ground magnetics to assess structure and alteration that is obscured by
widespread alluvial cover up to 100 meters thick.
The upshot of those surveys, released on Thursday, is the discovery
of a large, hidden gold structure that will be the target of NV
Gold’s first drill program of 2019.
Two ground-based geophysical surveys covering a 4 sq. kilometer area
“paint complementary images of the structure and nature of bedrock geology
hidden at depth beneath the Slumber project area,” NV Gold states in its news
release.
The results of a gravity survey indicate the presence of a broad,
north-northeast-trending trough, crossed by two deeper NE-trending
fault-bounded basins. A magnetic survey found “a distinct area of greatly
reduced magnetic susceptibility” thought to indicate a zone of hydrothermal
alteration. Moreover, the magnetic low, measuring about 2 km long by 300m
wide, stretches out in a north-northeast direction, coinciding with the
results of the gravity survey.
According to NV Gold, the geophysical surveys identified a lens-shaped
zone at the center of the target - further investigation will help to
pinpoint areas likely to contain high-grade gold or silver
mineralization. Also of interest are “hidden structural
continuities, possible conduits for hydrothermal fluids, and a significant
area of interpreted hydrothermal alteration,” that will be drilled in
August.
Frazier Dome
Once NV Gold completes drilling at Slumber, hopefully waking it up to a
major discovery, the company will pivot to its flagship Frazier Dome project,
located near Tonopah, NV.
The second drill program of the summer will target a potentially
mineralized gold system at depth - something relatively unusual for Nevada,
which has built a gold-mining reputation on a foundation of low-grade,
high-tonnage mines.
Frazier Dome is characterized as “a low-to intermediate-sulfidation,
volcanic-hosted epithermal gold system with high-grade mineralization.”
That’s in line with two types of mineralization often seen around the
Tonopah gold district:
- High-grade, intermediate-sulfidation silver-rich veins
and
- Younger, low-sulfidation, gold-rich mineralization
related to intrusive rhyolite domes, which have been the focus of West
Kirkland Mining’s Hasbrouck, Hill of Gold and Three Hills mines to the
south (total combined production of 1,063,000 ounces gold and 16,345,000
oz silver; and Allegiant Gold’s Eastside project 32 km to the
west, which has shored up an inferred resource estimate of 654,000
ounces gold and 3.9 million ounces silver.
A rhyolite dome is a mound of rock containing rhyolite, a type of igneous rock
formed when lava exudes from a volcano, creating a dome-like structure around
the vent. The presence of a rhyolite dome at Frazier Dome is significant,
because all of the other domes around it have unearthed significant
gold mineralization. Frazier is one of the last unexplored rhyolite domes in
Tonopah.
In its 2019 exploration program, NV Gold plans to chase the anomalous gold
found at surface, to depth. The idea is to try and find the source of the
high-grade surface mineralization. The company will set up
reverse-circulation drills and test the four targets it drilled last year, to
a depth greater than 150 meters.
For more on Frazier Dome, read NV
Gold chasing high-grade Au in Nevada
Drill to thrill
All of that is pretty technical, but the important take-away for AOTH
subscribers and NVX investors, is further evidence of a “drill to thrill”
strategy meant to preserve cash and reward shareholders.
We like the fact that NV Gold is being smart with how it sinks exploration
dollars into the ground, by hitting the best targets with drill holes that
will, at the very least, act as a kind of sniff test for going further. And
might perhaps lead to a major discovery hole. And just a note to investors
here – there will be, according to the company, a third project drilled this
year. We’ll hear news shortly.
We also love the exploration team that Ball and other NVX management have
put in place. These guys have 125 years of combined experience in Nevada, and
they have an incredible data set to help guide their claim-staking and
exploration efforts.
Compiled in the 1970s and 80s by USMX, which explored Nevada and built a
wealth of information, and AngloGold in the 1990s and 2000s, the databases
facilitate a “Nevada 2.0” thinking about the multiple layers of opportunity
that remain buried in Nevada. The goal is to systematically evaluate and
execute focused exploration programs.
Rock hounds trio
The trio of rock hounds includes Quinton Hennigh, a PhD in geology,
and CEO of Novo Resources (CNS:NVO), which is developing a conglomerate gold
play in Western Australia. Many remember Hennigh as the chief
geologist at Evolving Gold where he is credited with discovering the
Rattlesnake Hills deposit and a gold find three miles north of ATV - one of
NVX’s 14 projects.
Odin Christensen, PhD, is another long-time geologist with over 35 years
industry experience under his belt. He was with Newmont Mining for 21 years.
Between 1985 and 89, Christensen was exploration manager for Newmont and
Carlin Gold Mining in northeastern Nevada until he retired as their head geo.
Marcus Johnston, a PhD in economic geology, joined the company in January
as VP Exploration. Dr. Johnston brings more than 20 years of experience in
exploration and mining, with an emphasis on mineral systems in Nevada. He
also revitalized the entire McCoy mining district, now owned by Premier Gold
Mines.
We feel very confident in this group and its upcoming Nevada three drill
programs.
Tightly held
And we like NV Gold’s low share count - 46 million outstanding shares - of
which management and insiders own >45%. NVX has quality shareholders like
Eric Sprott, US Global Investors and Redstar Gold.
“It also giving us the strength to head into the fall with some capital to
continue on,” Ball added. The company's treasury is currently sitting at ~
Cdn$1.5 million. A $1 million plus oversubscribed private placement was
completed at the end of March, whereby the board of directors and management
purchased 27% of the shares.
Projects pipeline
A number of properties within NV Gold’s portfolio are either
drill-ready or continue to become more interesting as they are reviewed. They
include ATV, SW Pipe, Seven Devils, Painted Hills and Richmond Summit, to
name a few. Additional properties such as Queens, Long Island
and Larus/Gold Cloud are also on the radar with information. NVX
continues to discover with its high-caliber team digging deep into their
geological database to unearth quality exploration targets.
Gold price surging
Their timing is good. NVX and other gold juniors are sinking drill bits
into the ground as the gold price is maintaining its lofty heights.
A bunch of events have heaped together to produce a major upswing for
gold, which closed Thursday at $1,441.90, a $15 gain on the day. That
includes dovish signals from the US Federal Reserve ie. an interest rate
cut, record
central bank buying, a torrent of gold inflows into ETFs, and most
recently, weakness in the US dollar and dampened expectations of a resolution
to the US-China trade feud.
Silver was on a tear too on Thursday, with the spot price nearly hitting a
four-month high, before settling at $16.30 an ounce in New York
trading.
Technical analyst Jim Wyckoff of Kitco says a seven-week-old
uptrend for gold is in place, with the next resistance level for August
futures at June’s $1,442.90 high.
Conclusion
Of course gold prices don’t affect gold juniors directly, since they
are not yet producing, but a sustained upturn turns investors’ eyeballs
towards the sector, thus attracting capital to gold stocks. As resource
investors, we know the best leverage to a rising gold price, such as we see
today, is quality juniors with quality projects.
I’m looking forward to a great summer/fall of news flow from NV
Gold Corp..
NV Gold Corp
TSX-V:NVX, US:NVGLF
Cdn$0.16 July 19th
Shares Outstanding 46.4m
Market cap Cdn$7.4m
NV Gold website
*****
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This document is not and should not be construed as an offer to sell or
the solicitation of an offer to purchase or subscribe for any investment.
Richard Mills has based this document on information obtained from sources he
believes to be reliable but which has not been independently
verified. Richard Mills makes no guarantee, representation or warranty and
accepts no responsibility or liability as
to its accuracy or completeness. Expressions of opinion are those of
Richard Mills only and are subject to change without notice. Richard Mills
assumes no warranty, liability or guarantee for the current relevance,
correctness or completeness of any information provided within this Report
and will not be held liable for the consequence of reliance upon any opinion
or statement contained herein or any omission. Furthermore, I, Richard Mills,
assume no liability for any direct or indirect loss or damage or, in
particular, for lost profit, which you may incur as a result of the use
and existence of the information provided within this Report.
NV Gold Corp (TSX.V:NVX), is an advertiser on
Richard’s site aheadoftheherd.com. Richard owns shares of NVX
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