Essex Minerals Inc (CVE:ESX) said it has got off to a great start at the Cumberland joint venture project in Australia, hitting high-grade gold and silver mineralization in the first drill hole, sending shares in the firm soaring.
The hole hit 18.8 grams per ton (g/t) gold and 160.6 g/t silver over 6.4 metres (m) from 139.5m to 145.9m depth, including 63.6 g/t gold and 462.7 g/t silver over 1.7m, the firm said. It also encountered 9.9 g/t of the yellow metal and 191 g/t silver over 0.5m from a depth of 152.5m to 153m.
"To intersect high-grade gold and silver mineralization in the first drill hole on an early-stage project is a testimony to the quality of structural interpretation and target generation exploration work undertaken over the past six years by our joint venture partner KNX Resources Limited," Essex CEO Paul Loudon noted in a statement.
"The intersection of large intervals of alteration distributed over a wide area is indicative of a substantial hydrothermal system, and the discovery of high-grade gold and silver in at least part of this system points to the high prospectivity of the RBZ Structural Zone for hosting a large epithermal gold and silver deposit," he added.
The firm's partner, private firm KNX generated their northern Queensland properties Cumberland and Mount Turner after carrying out detailed structural analysis and tenement staking over the past six years.
Essex has the right to earn an initial first-stage earn in of 50% of KNX's interest in three properties - Cumberland, Compass Creek and Mt Turner - by spending A$1 million on exploration by May, 2021.
Loudon said the Cumberland drill results also validated Essex Minerals' strategy of backing geological teams with a track record of success and providing drill money to "advanced exploration projects in Tier 1 locations."
Now, the Cumberland Phase 1 drill program has been increased to six drill holes from four and will continue for another two to three weeks so that all the primary geochemical and structural targets along the 3.5km RBZ Structural Zone are tested, The Cumberland property has four granted exploration permits covering 25,024 hectares, 70 kilometres northwest of the former 3.5-million ounce Kidston gold mine.
The state of Queensland in Australia has a history of large epithermal gold deposits such as Kidston - 5 million ounces (M oz) at 1.24g/t gold, Mt Leyshon - 3.4M oz at 1.43g/t gold, and Pajingo - 3M oz at 6g/t gold, but remains under-explored in comparison to Western Australia and more recently Victoria, the firm noted.
KNX currently owns 80% of Cumberland and Compass Creek and 100% of Mt Turner.
After completing the first stage earn-in, Essex has the right to buy out the rest of KNX's interest for cash or shares or earn an additional 20% interest in Cumberland and Compass Creek and an additional 25% interest in Mt Turner by spending a further A$3 million on exploration.
Essex Minerals shares surged 28.5% in Toronto to C$0.54.
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