Shares of Sunridge Gold rose a brisk 7% in Thursday morning trade after the junior explorer gave an update on drilling at its zinc-gold-copper deposit in the Horn of Africa only to end the day down 2.8%. Near triple the usual number of shares changed hands on the Toronto venture exchange.
Investors in the the Vancouver-based company, which apart from its flagship Asmara project in Eritrea also has assets in another paragon of political instability, Madagascar, have enjoyed a wild ride over the more than ten years the company has been listed – an unlucky few snapped up shares in the company at $6.40 in 2003 and those who saw value in the company at $1.30 at the start of 2011 would have lost almost half that investment.
Sunridge Gold (CVE:SGC) has some 117 million shares outstanding and sits on $16 million in cash. Lundin Mining owns a small stake in Sunridge which it acquired in October last year. Heavyweight copper player Antofagasta decided not to exercise its option on the 800 square kilometre Asmara project in May this year. The company closed at 69c on Thursday giving it a market value of $80 million.
The drilling results that sparked the activity was at Sunridge ‘s small Adi Nefas deposit located near the Emba Derho Deposit, a surface mineable 62 million tonne copper-zinc-gold volcanogenic massive sulphide (VMS) deposit, part of Asmara.
Michael Hopley, Sunridge’s President and CEO said on Thursday: “These drill results further confirm the very high value of the mineralized material found at Adi Nefas when all metal values are taken into account. We believe that the current prefeasibility study being conducted on the Asmara North Deposits, which includes Adi Nefas, will show that this deposit will add significant value to the project economics by providing a higher grade “sweetener” feed to a process plant located at Emba Derho.”