Royal Gold (rgld-q) has proved up reserves at the Long Valley gold project in eastern California.
In 1996, the company drilled 326 reverse-circulation holes in a program spanning 100,000 ft. Proven and probable oxide reserves now stand at 35.7 million tons grading 0.019 oz. gold per ton, equivalent to 680,000 contained ounces. The estimate was calculated using a cutoff grade of 0.01 oz. and a gold price of US$350 per oz.
The property contains another 15.4 million tons of mineralized material with similar grades. Total gold resources stand at 970,000 oz.
The deposit contains pods of higher-grade mineralization, which the company believes could be mined quickly for early payback.
Metallurgical testing is yielding encouraging results, and the stripping ratio looks to be 1-to-1.
Royal hopes to farm out a majority interest in the project to a partner, which would act as operator. Royal would keep a royalty interest for itself.
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