VANCOUVER — Integra Gold’s (TSX-V: ICG; US-OTC: ICGQF) performance at its Lamaque gold project in the prolific Abitibi greenstone belt, 3 km from the city of Val-d’Or, Quebec, has attracted international miner Eldorado Gold (TSX: ELD; NYSE: EGO) to buy a 15% interest in the Vancouver-based company for $14.6 million.
Eldorado is buying 52.1 million shares at a price of 28¢ per share, for an 11% premium on the 20-day volume weighted average price of Integra shares, as of Aug. 17.
“It’s the highest hard dollar financing price we’ve done in three years,” Stephen de Jong, president and CEO of Integra tells The Northern Miner during an interview. “Out of the $50 million we’ve raised in this declining market, Eldorado paid the same hard dollar price as that financing.”
The proceeds will go towards the 100,000 metres of drilling this year across the property, with the majority spent on Lamaque’s Triangle zone. The exploration program is one of the largest in the industry this year.
De Jong says that in-fill drilling at Triangle is completed, and the company is on schedule to deliver an updated resource estimate this October. The rest of the drill program will focus on stepping out on known mineralization and expanding the resource.
“The footprint of Triangle was originally 300 metres by 350 metres, and it’s turning out to be more like 700 metres squared – and we still haven’t found the edge of it,” de Jong says.
A resource estimate completed last year increased indicated ounces at Triangle by 164% since 2013 to 1.32 million tonnes at 10.4 grams gold per tonne for 441,580 oz. gold. There are 429,300 tonnes at 11 grams gold for 152,370 oz. gold classified as inferred (using 5 grams gold cut-off).
Integra compares the potential at Triangle with the geologically similar Lamaque and Sigma gold mines, some 2.5 km to the north, which historically produced 9 million oz. gold.
Mineralization at the property occurs as a series of high-grade veins within brittely deformed intrusive plugs poking through the steeply dipping volcanic terrain.
But at the Triangle zone, de Jong says those veins will be conservatively estimated in the resource. Instead, the most prospective target for Integra is a series of steeply-dipping, gold-bearing shear zones that cross cut the intrusive dykes and extend much farther into the surrounding volcanics than the company previously imagined.
“The majority of gold produced at Lamaque came from mining the veins within the intrusive – mineralization never extended much farther than that,” he says. “But at Triangle, we’re seeing gold persist up to 300 metres into the volcanics, and it continues to grow.”
Results from the new zones include 22.2 grams per tonne over 4 metres, and 39.2 grams gold over 2 metres, with the attractive shears remaining open in all directions.
De Jong says Eldorado is particularly intrigued by the prospectivity of the Triangle zone. “They wonder just how big it can get … and their investment demonstrates their vote of confidence that we may have tapped into something big here.”
But unraveling the geological tale that endowed the crust with pools of gold may require more than just a number of drill holes – at least, this is how Integra sees it.
Instead, de Jong and his team believe the answer may be locked within the 6 terabytes of data taken from the Sigma and Lamaque mines after their acquisition by Integra last year – however, the company doesn’t have the manpower set up for the task.
“We’re a victim of our own success – we have a phenomenal team that’s running at 110% capacity just trying to stay on top of all the recent discoveries and exploration success we’ve had at Triangle,” he says.
Which is why the company announced in June that it will release the data to the public and launch the “Gold Rush Challenge,” which entices participants with a sponsored $1 million prize to pan through the data and pitch a “high conviction” exploration plan.
De Jong says that close to 500 people from over 39 countries have already signed up, and the company expects that number to increase once the data are released Sept. 15.
Integra is partnering with 3D modeling software producer Leapfrog, which will be providing participants with a “Gold Rush edition” copy of its program. Engineering firm WSP has also partnered up to assist with judging.
De Jong says the company looks forward to the first round of submissions in advance of the Dec. 1 deadline, but in the meantime will continue step out drilling on the shear zones at Triangle over the course of the Canadian winter.
“What we’re trying to communicate to investors right now is that the market news is not all bad,” he says. “This is a high grade deposit, held in a safe jurisdiction and fully-permitted – and that really gives us the momentum. A project like this was made for markets like these.”