Drilling on Bema’s Chile bet drive issue up to $4.40 high

Shares of Bema Gold (TSE) reached a new high recently after results from the company’s optioned Refugio gold property in Chile showed that reserves in the Verde deposit may be considerably larger than originally anticipated. That is the conclusion reached by Bema after the company’s Chilean subsidiary completed 160,000 ft. of reverse circulation drilling in 250 holes throughout the Verde deposit.

The latest news from Chile is particularly significant to Bema, as indicated by recent increases in the company’s share price which peaked recently at $4.40.

Verde is one of two known gold deposits on the Refugio property where inferred reserves at the end of a previous drilling phase were estimated at 105 million tons of grade 0.031 oz. gold per ton (including 75 million tons oxide grading 0.030 oz.).

Under an agreement that gives Bema’s Chilean affiliate the right to earn a 50% stake in the project, the company is examining the feasibility of operating a bulk tonnage open pit gold mine. If everything goes as planned, Bema will announce minable reserves figures in late October and complete a prefeasibility study in December, Bema spokesman Don Halliday told The Northern Miner. “Production could begin as early as the end of 1991,” he said.

Meanwhile, results from stepout drilling in the eastern portion of the Verde deposit have expanded the higher-grade oxide zone outlined by phase one drilling.

According to Bema, the higher- grade body is now seen to have a “doughnut” shape measuring about 1,500-1,100 ft., while extending to a depth of 700 ft. where it remains open.

“A weighted average grade of 0.041 oz. gold has been calculated from drill intercepts within the zone which is estimated to contain several tens of millions of tons,” the company said.

Highlights from recent drilling on the Verde deposit include 53 ft. of grade 0.10 oz. gold per ton at a depth of 328-381 ft. and 32 ft. of grade 0.11 oz. from 276-308 ft.

Verde has now been defined over an area spanning 4,500×2,100 ft. wide and to a depth of over 800 ft. below surface. Analysis of the drill data shows that virtually the entire deposit is open at depth. “We still don’t know where the base of the deposit lies,” said Halliday.