VANCOUVER — Between completing a public listing, hitting a number of long gold intercepts in Guyana, and finalizing $14.5 million in financings, Sandspring Resources (SSP-V) has had a busy few months.
And while the company was listed publicly late last year, the people behind it have been busy in Guyana for some time.
“It’s a brand-new public company,” says Abraham Drost, president of Sandspring. “But that being the case, it represents ten years of operational experience in Guyana as a private company (ETK), now a wholly-owned subsidiary of Sandspring. All the assets and so forth are under the name of ETK and wholly-owned by Sandspring, so it was a fairly smooth transition.”
The public listing came after ETK did a reverse takeover of Sandspring, which was until then a capital pool company without assets. The founders of ETK, John Adams and Rich Munson, are now Sandspring’s lead director and chief executive, respectively. Adams and Munson ran Energy Fuels Corp. in the 1980s and early 1990s, when it was the largest producer of uranium in the United States, before selling it and making investments elsewhere, including in Guyana. The two brought Drost onboard as president last May.
“I looked at it, met the people,” says Drost. “The timing was good for me and I jumped in with both feet, 100% committed as president.”
Drost is now working to upgrade the already established resource estimate at the 250-sq.-km Toroparu project, the company’s sole property. The current resource estimate stands at 45.6 million indicated tonnes grading 0.93 gram gold per tonne and 0.16% copper and 36.8 million inferred tonnes grading 0.82 gram gold and 0.13% copper. Drost has the current drill program both infilling the established deposit as well as exploring the edges and below the deposit.
Most recently, the company reported the results of hole 54, at the western edge of the defined resource; it returned 117 metres grading 1.1 grams gold and 0.1% copper between 232.5 metres and 349.5 metres, and then hit 111 metres grading 2.1 grams gold and 0.08% copper at 400.5 metres depth.
Also this year, hole 51, just southwest of the defined deposit, cut 115.5 metres grading 1.01 grams gold and 0.03% copper starting at 465 metres and hole 56, on the eastern edge, hit 193.5 metres grading 0.6 gram gold and 0.03% copper from 262.5 metres followed by 15 metres averaging 2 grams gold and 0.01% copper starting 502.5 metres downhole.
Drost says the deeper intercepts could either be from a sub-parallel body in the North zone that was largely inferred in the resource estimate, or could be a deeper extension of the established Main zone.
During last year’s drill program, hole 50, on the eastern edge of the deposit, hit 120 metres grading 1.33 grams gold and 0.09% copper starting at 219 metres depth, and then 44 metres grading 1.58 grams gold and 0.05% copper starting at 444 metres depth. Hole 36, on the western edge, intersected 103.5 metres grading 1.76 grams gold and 0.09% copper starting 238.5 metres downhole.
Since returning to exploration in 2009, the company has drilled about 13,000 metres. With the $14.5 million recently raised from a bought-deal financing, Drost says the company will conduct roughly 40,000 metres of more drilling this year.
“We intend to ramp up here,” says Drost. “We’ve got two drills onsite, we’ve ordered a third drill, and that should dovetail nicely with an expanded resource estimate and scoping study.”
While the new company has its eye on a large-scale mine, the old private company had already established a medium operation onsite. Indeed, it was while ETK was mining small saprolite pits and operating a 3,000-tonne-per-day mill that they understood there was more to the property.
“When they mined one of the saprolite pits down to bedrock they realized the bedrock was mineralized and they drilled for the first time in 2007,” says Drost. “When it became apparent that they were on to something significant they started laying the groundwork to go public.”
Thanks to the previous mining, the site already has a 60-man camp, a mill, an airstrip and a 150-km road linking the site to the port city of Bartica.
Until late 2009, the company had also been alluvial mining what it believes to be eluvial placer gold at surface, and which Drost says could reflect a bedrock trend. This year, the company has been busy with drilling as well as care and maintenance on site and has not yet decided what mining will be conducted.
Sandspring’s stock price kept steady at $1.50 on news of the latest intercepts. The company has a 52- week trading range of 65¢-$2.00 and 79 million shares outstanding (96 million fully diluted).