Orezone expands Bombore project area

When the shares of most companies were tanking yesterday in what turned out to be the worst day on the markets since December 2008, shares of Orezone Gold (ORE-T) edged 4.32% higher or 13¢ to close at $3.14 on news it had received exploration rights to an additional 63 sq km of ground adjacent to its 100%-owned Bombore gold project in Burkina Faso. The new Toéyoko permit extends the project footprint to the south and southwest of Bombore by 60%.

“With recent drilling in the southern half of the Bomboré deposit delivering higher grades and better continuity, the Toéyoko permit is an attractive target for future exploration,” Ron Little, Orezone’s chief executive, said in a prepared statement. “The auger drilling and gold-in-soil geochemical anomalies adjacent to the new permit are positive indications that what we are currently investigating on Bomboré could extend onto the Toéyoko permit.”

A 12,146 metre 2,547-hole auger drill program was completed on the Bomboré permit between February and July 2011, including some fences along the boundary with the new Toéyoko permit, the company says. The program was conducted on a line spacing of 200 metres, with holes drilled at 25-metre intervals to depths of up to 15 metres but averaging 5 metres.

Orezone notes that “significant anomalies warranting reverse circulation (RC) follow-up drilling have been identified in several areas.”

Bombore, Orezone’s 100%-owned flagship project, is one of the largest undeveloped gold projects in the country. Resources at the project, about 85 km east of Burkina Faso’s capital city, Ouagadougou, are constrained within optimized open-pit shells that span 11 km.

Indicated resources stand at 61 million tonnes grading 0.8 gram gold per tonne for contained gold of 1.6 million ounces, while inferred resources stand at 61 million tonnes grading 1 gram gold for 1.9 million ounces. The resource has an average drill depth of just 60 metres.

The company is completing a $24 million, 170,000-metre drill program to expand resources, and hopes to finish a feasibility study in 2012 and become a mid-tier producer by 2015.   

Mining analyst Nicholas Campbell of Cannaccord Genuity “is bullish on the story based on valuation and continues to view Orezone as one of the top acquisition targets in the junior gold space,” the firm wrote in a morning note to clients.

The Aug. 9 note said Campbell “expects the 170,000-metre drill program at Bombore to expand the current resource to more than 5.0 million ounces of gold, expanding the mineable resource and significantly reducing the strip ratio.”