GoGold Resources (TSX: GGD; US-OTC: GLGDF) has reported assay results from 12 drill holes at its Los Ricos South project in the Mexican state of Jalisco, 100 km northwest of the state’s capital, Guadalajara.
The drill highlights include 11 metres of 625 grams silver-equivalent per tonne, consisting of 358 grams silver per tonne and 3.56 grams gold per tonne from hole 20-136. The hole was drilled in the main area of the Los Ricos quartz vein and the intercept started from 162 metres downhole.
Hole 20-135 intersected 23 metres of 212 grams silver-equivalent from surface, comprising 133 grams silver per tonne and 1.06 grams gold per tonne, with 49 metres of 111 grams silver-equivalent per tonne, (80.3 grams silver per tonne and 0.41 gram gold per tonne), from hole 20-132 starting from 322 metres downhole.
“At nearly 50 metres wide, hole 132 was one of our widest intercepts as well as our deepest drill hole,” Brad Langille, the company’s president and CEO, said in a telephone interview. “It showed an extremely high core of three metres grading 1,270 grams silver-equivalent per tonne.”
“The assay results continue to show that there is significant potential to increase the size of the Los Ricos deposit, which we believe will be a core asset and significant driver of value for the company.”
The property consists of 29 concessions, covering around 220 sq. km, and is home to numerous historic underground mining operations that date back to Spanish colonial times in the early 1500s.
There are also 65 historical reverse circulation (RC) drill holes from 2003 and 2004 on the property, the majority of which intercepted mineralization near surface.
Drilling at Los Ricos South began in March 2019, and has focussed on defining the mineralized halo around several of the historical high mines, including El Abra, El Troce, San Juan and Rascadero, as well as the Cerro Colorado and Las Lamas targets.
The 10,000-metre program is testing the top 200 metres of the mineralized zone to determine the potential for surface mining. It is in conjunction with geological mapping, sampling and trenching, according to the company.
A drilling campaign was also launched last month at the Los Ricos North project and includes the Monte del Favor, Salomon, La Trini and Mololoa targets.
Although exploration activities are currently halted due to restrictions imposed by the Mexican Government following the COVID-19 outbreak, the company continues to receive assay results from drill holes completed previous to the suspension of drilling.
“The drilling program at Los Ricos south continues with six drill rigs, and we intend to accelerate the drilling once restrictions are lifted,” Langille said, “and while the program is providing solid results for the south project, we will also expand the drilling program in the north, which we believe may provide even stronger returns.”
GoGold Resources acquired the 29 concessions from private owners in August 2019 in a deal worth about $7.1 million. Upon signing the agreement, the company paid US$500,000 in cash and is required to pay US$3.22 million in cash installments over 24 months, and deliver 9.05 million common shares over the same period.
As per the agreement, five of the 29 concessions were transferred to the company, and are targets for the company’s current drilling program. The remaining concessions are to be transferred at a rate of five every five months.
In addition to the concessions, the company also acquired the existing 2% net smelter return royalty for the property for a US$1 million cash payment, to be paid in equal installments over 36 months, and 4.88 million common shares in the company, delivered in equal numbers over 18 months.
At press time in Toronto, GoGold Resources was trading at 74¢ per share within a 52-week trading range of 28¢ and 85¢.
The company has 222 million common shares outstanding for a $153-million market capitalization.