Newcore Gold lifts Enchi’s resource by 24% in Ghana

Canadian developer Newcore Gold (TSXV: NCAU) said a resource update for its Enchi gold project in southwestern Ghana boosts the deposit’s footprint by 24% as the company advances toward a prefeasibility study.

Enchi now holds an estimated 2.13 million oz. gold, including 1.5 million indicated oz. and 626,000 inferred oz., Vancouver-based Newcore said Wednesday in a statement. That’s up from the 1.72 million oz. that was calculated in a January 2023 estimate. Indicated ounces have doubled in three years, the company said.

News of the increased resource comes as Newcore carries out a recently expanded 60,000-metre drilling campaign at Enchi. The company has said it sees a “district-scale exploration potential” for the project, which covers a 248-sq.-km land package.

“We view today’s update as a positive de-risking event, which reflects both a successful resource conversion campaign and solid overall resource growth at Enchi,” Haywood Securities mining analyst Marcus Giannini said in a note.

“Enchi has significant untapped potential, with ample room for additional resource growth from strike and depth extensions, both at existing resource zones and various regional targets.”

Open along strike

All four pit-constrained deposits at Enchi are open along strike and at depth, Newcore said. Resource pits have an average depth of 85 metres, with most drilling so far only testing shallow mineralization down to an average depth of 125 metres, the company added.

Located about 300 km from Accra, Enchi sits on the Sefwi-Bibiani belt, a zone that hosts multiple gold mines with mineralization proven out to significant depths. It’s located 50 km south of Asante Gold’s (TSXV: ASE) Chirano mine.

Ghana itself is Africa’s largest gold producer and a well-established mining jurisdiction — factors that continue to attract junior explorers and developers seeking scalable projects with existing infrastructure.

A 2024 preliminary economic assessment envisaged a nine-year open-pit, heap-leach operation capable of producing about 122,000 oz. annually. Based on a 5% discount rate and a $1,850 per oz. gold price, the project has an after-tax net present value of $371 million and a 58% internal rate of return. Initial capital is estimated at $106 million, with an after-tax payback period of 1.6 years.

June PFS

“The substantial conversion of resources to the indicated category, more than doubling the indicated ounces, de-risks the project development and will form the basis for the pre-feasibility study that is underway,” CEO Luke Alexander said in the statement.

“The resource also continues to highlight the multi-million-ounce potential of the project, and with drilling underway and not yet included in this resource, we believe that as we continue to drive the development of the project, we are in a unique position to continue to highlight resource growth via the drill bit.”

The pre-feasibility study is expected to be published by the end of June.

Newcore shares fell 1.6% Thursday morning in Toronto amid a stock market rout, cutting the company’s market value to about C$173 million ($126 million).