West Red Lake Gold Mines is capitalizing on their success in 2016 with more drilling
Angela Harmantas | March 6, 2017 | SmallCapPower: After a successful year of drill results in 2016, West Red Lake Gold Mines Inc. (CSE: RLG) is aiming to prove that their main project, the Rowan Mine property, is just the tip of the golden iceberg.
Rowan lies in the Red Lake gold district in northwestern Ontario, one of the oldest and most prolific gold-bearing regions in the world. The 3100-hectare project has 12km of strike length on the Pipestone Bay-St. Paul Deformation Zone, where three former gold mines are situated. The current deposit has a defined resource estimate of 1.1 million Inferred ounces of over 7.5 g/t Au. The management team has good reason to believe that there could be more at Rowan alone, as drilling is still open at depth. History proves at Red Lake that the good stuff is often found much deeper
The property is situated on the Archaen greenstone belt, which hosts the high-grade gold mines of the Red Lake gold district. In fact, Rowan is 40% owned by Goldcorp, which has a long successful history at Red Lake.
Those factors alone would give investors cause for enthusiasm, but there’s another area on the property that’s exciting analysts even more than Rowan. To the east of Rowan is the Structural Intersection, where a second regional gold bearing structure intersects the main east-west trend. World-class deposits have been uncovered at similar intersections in Red Lake.
“Drilling at the structural intersection is more complicated because the rocks fold and fracture where the regional gold bearing structures meet, but the payoff can be much better,” said John Kontak, West Red Lake Gold’s President.
Deposits with similar geological features can often host large gold deposits, and RLG is eager to start exploring the trend. They have already identified a number of interesting geophysical targets in the area.
Right now RLG’s primary focus is expanding the Rowan Mine deposit resource estimate and adding more ounces. Mr. Kontak hopes to increase the amount of ounces in the ground. “The increase of the Rowan resource estimate from 1.1 million ounces to something larger is relatively easy drilling,” he said. “The plan is to expand the deposit by drilling to greater depth, and along strike.”
The initial drill program should wrap up in a few weeks, with results expected in early Q2 2017. The team is already planning a follow-up drill program to further develop the property in the middle of the year. “Our goal is to essentially de-risk the project so that in a couple of years a gold producer can look at it and think it’s worth something,” said Mr. Kontak.
It’s something the management team is certainly comfortable doing. RLG’s Executive Chairman, Tom Meredith, previously led the development of four gold projects in northwestern Ontario with VG Gold. He grew his former company from a $3 million valuation to well over $200 million before being acquired by Rob McEwen’s Lexam Gold.
“We consider ourselves exploration and development people, and we think a lot of the value is created in the early stages,” Mr. Kontak said. “A gold producer down the road will look at the West Red Lake project as having the potential to be a gold mine in Red Lake.”
Ubika Research/SmallCapPower has received compensation from West Red Lake Gold Mines to provide analyst research coverage. For full disclosure please visit here >>.