Amarillo reinterprets Posse with new resource model
Amarillo Gold (TSXV: AGC) has reinterpreted its resource model for the Posse gold deposit at its Mara Rosa gold project in Goias State, Brazil, and with it updated the project’s resource estimate. The company says its new model fundamentally alters its understanding of mineralization at Posse.
The updated resource model spans three contiguous zones and includes a higher grade core that Amarillo could access early in a potential mine’s life.
The higher grade zone contains 8.9 million measured and indicated tonnes grading 2.2 grams gold per tonne for 630,000 oz. gold.
Overall, the Posse deposit contains 29 million measured and indicated tonnes at 1.2 grams gold for 1.2 million oz. gold. It also contains 1.4 million inferred tonnes at 0.7 gram gold for 30,000 oz. gold.
The company based its updated resource estimate on 344 drill holes including 44 new diamond drill holes and 11 new reverse circulation holes for infill drilling totaling 12,700 metres.
In a prepared statement, Amarillo CEO Mike Mutchler called the new resource model “more conservative and robust.”
The previous estimate, included in a September 2018 pre-feasibility study (PFS), outlined 12 million measured tonnes grading 1.4 grams gold for 560,000 oz. gold and 19 million indicated tonnes grading 1.2 grams gold for 710,000 oz. gold as well as 11 million inferred tonnes at 0.92 gram gold for 330,000 oz. gold.
According to the PFS, Posse has a $244.3 million after-tax net present value at a 5% discount rate and a 50.8% after-tax internal rate of return.
The company intends to use the updated resource model in a feasibility study it aims to finish by the end of the year.
(This article first appeared in The Northern Miner)