Lundin Gold (TSX: LUG) announced on Wednesday that its 9,000 metre regional exploration drill program has begun, with the first drill hole now in progress on the Barbasco target, about 7km from its Fruta del Norte gold-silver mine in Ecuador.
The company’s regional exploration program will focus on two high priority targets, Barbasco and Puente-Princesa, to test for mineralization in a geological setting very similar to that of Fruta del Norte.
The Barbasco target is defined by the epithermal pathfinder elements arsenic and antimony in both soil and rock samples and a ZTEM (resistivity) geophysical survey. The anomaly trends NNW for 3.8km within the basin conglomerates and late andesites of the Suarez basin in orientation and structural position similar to that of Fruta del Norte.
“Our objective is to find another Fruta del Norte style deposit,” Ron Hochstein, Lundin Gold CEO said in a press release. “We expect initial assay results in the middle of 2021.”
Lundin has set its 2021 production goal at between 380,000 and 420,000 ounces of gold at an average head grade of 10.4g/t, a recovery rate of 90% and all-in sustaining costs (AISC) of $770-830 per ounce.
The company also increased Fruta del Norte’s reserves by 8% to 5.41 million ounces, thanks to changes in the planned mining method.