Shares of Condor Resources Plc (CNR-L) leapt 30% to close at £6.50 apiece with 8.7 million shares changing hands on news the London-headquartered company was starting to drill its La India concession in Nicaragua.
Earlier this month, Condor completed a JORC-compliant resource estimate on the La India and Espinito San Pablo concessions – together known as the La India concessions. Inferred resources tally 4.58 million tonnes grading an average of 5.9 grams gold per tonne for 868,000 ounces of gold.
Condor owns 80% of the La India concession with B2Gold (BTO-T) owning the remaining 20%.The La India concession covers an area of 69 sq km. Condor owns 100% of a further four concessions that are contiguous to La India, which span an additional 96 sq. km and include a JORC-compliant inferred resource of 41,000 oz. gold.
The drill program is expected to start in February and Condor has contracted a diamond drill rig to drill 2,000 metres with an option for an additional 3,000 metres.
The drill program is designed to extend the inferred resource along strike on four of the principal veins, and to fill in the gaps between resource blocks by drilling beneath zones where high-grade gold mineralization has already been intercepted at surface by trenching.
Zones where gold mineralization has been demonstrated by trench sampling but not confirmed at depth, either by drilling or mine sampling, were not included in the current resource. According to Condor, some of them have shown continuity in strike at surface over several hundred metres and it is these that are being targeted first.
Later, drilling will try to further increase the inferred resource by targeting down-dip and strike extensions with specific targets dependent on the results of the initial drilling.
Holes will be drilled on a nominal spacing of 100 metres along strike and 60 metres intercept depth beneath high-grade surface trenches, with further down-dip drilling at 100-metre depth spacing.
The company expects it will take two to three months to complete the first 2,000 metres of its drill program.
After the first 2,000 metres are drilled, B2Gold must contribute 20% of additional exploration costs on the concession to maintain its 20% equity stake in the project.
Condor’s La India concession hosts the historic La India underground gold mine, which between 1938 and 1956 produced an estimated 1.7 million tonnes at an average grade of 13.4 grams gold for a total of 576,000 ounces of gold.
Condor notes on its website that according to mine records, at the height of production in 1953, the La India mine produced 41,861 oz. gold at a grade of 11.8 grams gold per tonne and 39,282 oz. silver. The mining was concentrated on two veins, the La India vein, where a 1200-metre strike length was mined to a depth of up to 200 metres below surface and the America-Constancia vein, where a 2200-metre strike length was mined to a depth of 250 metres below surface.
Severe flooding and damage to the plant closed the mine in 1956. It wasn’t until the early 1990s that exploration there resumed. In 1991 a Soviet-sponsored drill program on the La India concession defined 1.84 million oz. gold at an average grade of 9.1 grams gold per tonne (to Russian classification) and 2.4 million oz. gold at 9.1 grams gold in the mining district (excluding the 96 sq km of Condor’s concessions in the district).
So far Condor has identified more than 17 km of mineralized veins at surface in the district and estimates that less than half of the known mineralized veins have been drilled.
In the latter part of this year, Condor plans to start a deep drill program to determine how deep the system is, as it is currently open to depth.