Goldquest sinks 37% on drill results

Shares of Goldquest Mining (GQC-V) have dropped lately every time the company has published additional holes from its ongoing drill program at the Romero gold-copper target. This time it was no different. The stock plunged 37% after the Vancouver-based explorer released the latest five holes from the Romero target on its Las Tres Palmas trend in the Dominican Republic.

The best hole of the batch, LTP-111, returned 52 metres of 1.31 grams gold per tonne and 1.24% copper within a larger intercept of 80 metres grading 0.93 gram gold and 0.85% copper.

LTP-111 is Romero’s furthest hole drilled to the east, and steps out about 100 metres from the previous drilling.

“The Romero mineralized zone now extends over 400 metres from the north-west to the south-east, representing less than 25% of the IP anomaly between Romero and Escandalosa, and remains open in both directors,” said Julio Espaillat, the company’s CEO in a statement.

To get a better picture of the potential between the two targets, the junior has retained Ontario-based Insight Geophysics to initiate a second phase of induced-polarization (IP) surveys at the Las Tres Palmas trend.

The surveys should penetrate to a depth of 500 metres and provide better quality data for the known anomalies south of Romero and to the west. The surveys are slated to start in December and carry on through mid-2013.

To date, Goldquest has reported 23 holes at Romero that was discovered in late May.

Of the results released so far, LTP-106 was the first deep hole, with a final length of 704.8 metres. It returned 166 metres grading 0.67 gram gold and 0.16% copper and ended about 230 metres below the bottom of hole, LTP-93, which the company reported in late July and perhaps was the last drill result that had a positive effect on the company’s share price.

While the mineralization at depth was not significant, Goldquest says LTP-106 verified mineralization to the south of the La Guama structure, adding it is the furthest step-out to the south. The company plans to poke additional deep holes using results from the IP surveys to further test mineralization at depth.

Goldquest also intersected two low-grade gold mineralized zones to the south of Romero in LTP-110 starting from 98 metres and 186 metres downhole, returning 11.8 metres of 0.55 gram gold and 24.4 metres of 0.43 gram gold, respectively. Both assays contained low values of copper.

On the drill results, Goldquest lost 29¢ to close at 49¢ on 7.3 million shares traded.