The drill program, which kicked off in May with three diamond drill rigs operating from underground drill stations in the existing Marmato mine, also extended the Main Zone along strike by more than 300 metres, where it remains open.
So far the company has completed about 30% (9,400 metres) of its 2020-2021 drill program, which will consist of 60 holes (31,000 metres). Of that, 20,400 metres are conventional drilling in 40 holes and 10,600 metres are directional drilling in two other holes and 18 kick-off holes.
The Marmato mine is expected to produce between 23,000 and 26,000 ounces of gold in 2020
Drilling in the New Zone, the company said, confirms the extension of the high-grade mineralization to below the 600-metre level, which is the bottom of the indicated mineral resource used in the prefeasibility study. The New Zone extends for more than 400 metres along strike and 200 metres vertically.
Highlights released today from the drill program included drill hole MT-IU-073, which returned 343.4 metres of 2.83 grams gold and 1.5 grams silver starting from 340 metres, including 33.77 metres of 5.10 grams gold and 2.7 grams silver; 60.70 metres of 4.59 grams gold and 2.1 grams silver; and 39.04 metres of 3.74 grams gold and 1.4 grams silver.
“Our sense of excitement continues to build as the New Zone continues to deliver robust gold grades over significant lengths that start to demonstrate continuity and a developing high-grade zone similar to the adjacent Main Zone,” Serafino Iacono, Caldas Gold’s executive chairman and CEO, said in a press release.
“In addition, the 300 metres of strike extension for the Main Zone provides us with another zone ready for infill drilling to continue to grow the underground mining expansion at Marmato.”
Last week Caldas Gold closed a precious metals stream with Wheaton Precious Metals (TSX: WPM; NYSE: WPM; LSE: WPM) on Marmato. Under the deal, Wheaton will purchase 6.5% of the gold production and 100% of the silver production until 190,000 oz. of gold and 2.15 million oz. of silver have been delivered. After that, the stream drops to 3.25% of gold production and 50% of the silver production for the life of mine.
Wheaton will pay a total of $110 million in cash, $38 million of which is payable within six months, and the remainder will be paid during construction. The precious metals stream covers the Upper mine and the Marmato Deeps Zone (MDZ) development.
A prefeasibility study released in July confirmed the economic viability of expanding the underground mining operation at Marmato, according to Caldas Gold. The PFS estimated a life-of-mine production schedule of 19.7 million tonnes of mineralized material being processed over a 14-year mine life, resulting in total production from the existing Upper mine and the expansion of the second operation into the Marmato Deep Zone, of 1.9 million oz. gold and 1.6 million oz. silver.
Initial capital required between 2020 and 2023 for the expansion into the Marmato Deep Zone is estimated to run to $269.4 million. The company has also updated its plan for the Upper mine to incorporate an expansion from 1,200 tonnes per day to 1,500 tonnes per day.
The Marmato mine is expected to produce between 23,000 and 26,000 ounces of gold in 2020.
Gran Colombia Gold (TSX: GCM; US-OTC: TPRFF) spun off the Marmato mining assets in February and owns about 54% of Caldas Gold, according to its latest corporate presentation.
(This article first appeared in The Northern Miner)
