New Found Gold (TSXV: NFG) says new drilling expands its Keats West discovery in the Queensway project of central Newfoundland.
Hole NFGC-22-773 intersected 18.6 grams gold per tonne over 15.95 metres with mineralization starting at a vertical depth of just 8 metres, the company said in a news release on Wednesday.
The new intercept is located up the sloping formation from two holes the company reported in September: NFGC-22-681 cut 4.2 metres grading 17.9 grams gold per tonne 200 metres away; and NFGC-22-686 returned 10.5 metres grading 10.4 grams gold, 150 metres from the new hole.
“Today’s results affirm the significance of the Keats West discovery and indicate that drilling has locked onto a new structure with proven potential,” Melissa Render, New Found vice president of exploration, said in the release. “The degree of faulting, veining and pairing of both low and high-grade gold mineralization gives us great enthusiasm.”
The lower-grade mineralization in the Keats West structure includes several holes grading from 1.3 to 3.4 grams gold over an interval of about 50 metres and ranging in cumulative width from 18 to 30 metres, the company said.
New Found is one of the main companies along with Labrador Gold (TSXV: LAB) and Exploits Discovery (TSXV: NFLD) and investors such as Eric Sprott in a surge of exploration of the Appleton fault zone just west of Gander, NL. Proponents say the area could one day rival regions like the Abitibi gold belt in northern Ontario and Quebec, and northwest British Columbia’s Golden Triangle.
New Found’s latest drilling was done in a new northeasterly direction, whereas almost all previous drilling at Queensway was oriented northwest, Andrew Mikitchook, an analyst based in Toronto for BMO Capital Markets, said in a note on Wednesday.
“We will be watching for further results to see whether the new drill orientation continues to pay off at Keats West,” Mikitchook said. “The shallow nature of the mineralization lends itself well to quick and cost-effective drilling.”
About 78% of New Found’s 400,000-metre drilling program at Queensway has been completed with about 67,000 metres of assay results pending, the company said.
New Found’s 1,500-sqkm Queensway property also includes the Lotto, Keats, 515 and Golden Joint sites. The first hole drilled at Queensway in 2019 returned 92.9 grams gold per tonne over 19 metres.
Earlier this month, New Found reported results from the Lotto North area, which is in the Appleton fault zone north of Keats West. Those showed intervals of 37.36 grams gold over about 2 metres from 69.45 metres depth in NFGC-22-690, and 33.79 grams gold over 2.5 metres from 74.6 metres depth in NFGC-22-661.
Exploration chief Render on Wednesday said the company would continue to explore a 9.45 km-long segment west of the previous study area.
“The discovery of high-grade gold mineralization west of the Appleton fault is a relatively new advancement,” she said. “This only furthers our excitement as we continue to explore new target areas.”
BMO’s Mikitchook has an outperform rating on New Found stock and a target price of C$10. It was trading at C$4.93 after briefly rising to C$5.05 Wednesday morning, within a 52-week range of C$4.03 and C$9.64. The Vancouver-based company is valued at C$833.9 million.