Lundin reports bonanza intercepts at Fruta del Norte

Lundin Gold (TSX: LUG) reported multiple bonanza intercepts from its Fruta del Norte project in Ecuador — including two of the highest grade‑thickness holes ever drilled at the property — as the Canadian company continues to upgrade resources around the mine.

Highlight hole FDN-C25-374 in the Fruta del Norte South zone cut 7.5 metres grading 667.78 grams gold per tonne from 19 metres downhole, Lundin said late Tuesday in a statement. Hole FDN-C26-380, meanwhile, cut about 8 metres grading 523.01 grams gold from about 23 metres depth.

Vancouver-based Lundin is working to maintain or extend Fruta del Norte’s projected 12-year mine life by expanding resources, detailing new discoveries and converting inferred resources to indicated. The operation — which the company has described as being among the world’s highest-grade operating gold mines — began commercial production in 2020 and churned out 498,315 oz. gold last year. 

“Conversion and infill drilling continue to reinforce the Fruta del Norte growth pipeline,” National Bank Financial mining analyst Don DeMarco said Wednesday in a note.

Lundin shares jumped 7.9% to C$94.19 Wednesday morning in Toronto, valuing the company at about C$23 billion ($17 billion).

High-margin operation

Other drill results released Tuesday included hole UGE-E-25-425 at Fruta del Norte East, which cut 5.9 metres grading 20.34 grams gold from 299 metres depth. Hole UGE–E-26-429, in the same zone, cut 4.2 metres of 169.93 grams gold from 427.50 metres depth.

The latest results build on a series of high-grade intercepts reported earlier this year and reinforce the potential for Fruta del Norte to remain a high-margin gold operation.

Management has set aside a record $85 million for exploration at Fruta del Norte this year. Crews are expected to drill some 133,000 metres — of which 125,000 metres are dedicated to conversion and near-mine exploration.

Recent work at Fruta del Norte South has focused on the deposit’s central and northern sectors, where drilling continues to confirm the geological model’s robustness, Lundin said.

Mine plan update

Since its opening, Fruta del Norte has consistently delivered strong operating results. Lundin is targeting annual production of between 475,000 and 525,000 oz. of gold in 2026, 2027 and 2028 at average head grades of 8.3 grams gold.

A decision on whether to develop Fruta del Norte South is expected in this year’s first half, when Lundin is due to update its life-of-mine plan. A decision on potentially expanding mine-to-mill throughput beyond 5,500 tonnes per day should follow in the second half.

Fruta del Norte South holds about 2.5 million inferred tonnes grading 6.66 grams gold for contained metal of 540,000 oz., according to a 2025 resource.

Measured and indicated resources for the entire mine stand at 32.6 million tonnes grading 7.13 grams gold for 7.48 million oz., with a further 10.3 million inferred tonnes at 6.17 grams for 2.03 million ounces.

“Exceptional systems tend to surprise to the upside, and it is clear there remains significant potential for additional expansion,” CEO Jamie Beck said in the statement.

“With 17 rigs currently operating at site between the epithermal gold deposits and copper gold porphyry targets, we remain confident in our ability to continue creating value through disciplined exploration across this remarkable mining district.”