Lion One Metals rises on longest high-grade intercept at its Tuvatu project in Fiji  

Shares of Lion One Metals (TSXV: LIO; US-OTC: LOMLF) reached their highest level in a year as the company reported its longest high-grade gold intercept at depth beneath the current resource at its Tuvatu alkaline gold project in Fiji. 

Hole TUG-141, which targeted the project’s 500 zone, yielded a grade of 20.86 grams gold per tonne over 75.9 metres starting from 443.4 metres, including 43.62 grams gold over 30 metres starting from 477.6 metres and 90.35 grams gold over 7.2 metres starting from 494.3 metres.  

“Like the initial discovery of the high-grade 500 Zone drilled two years ago, I believe this new robust high-grade gold feeder mineralization encountered by hole TUG-141 represents a substantial discovery,” Lion One CEO, Walter Berukoff, said in a press release on June 6.  

“The notable high grades and continuity of mineralization of this intercept demonstrate Tuvatu’s potential to become a large-scale, high-grade underground gold mine,” he added. 

The company’s immediate priority is to follow up on the discovery found in a “relatively poorly drilled portion” of the project, with additional drilling. It aims to begin gold production in the second half of 2023.  

Located about 17 km from the Nadi International Airport on the main island of Viti Levu, Tuvatu was acquired by Lion One in 2011 and has resources of 1 million tonnes grading 8.48 grams gold per tonne for 274,600 oz. gold in the indicated category. Inferred resources add 1.3 million tonnes grading 9 grams gold for 384,000 oz. gold.  

The project’s preliminary economic assessment envisages a five-year mine that is expected to generate an average of about 70,000 oz. gold annually, at all-in sustaining costs (AISCs) of US$713 per ounce.  

With an initial capital cost estimate of US$66.8 million and based on US$1,400 per oz. gold, the after-tax net present value for the proposed build stands at US$121.7 million, at a 5% discount rate, with a 50.9% internal rate of return and a 1.7-year payback. 

Explaining the deposit’s system, Lion One’s technical advisor, Quinton Hennigh said: “Alkaline gold systems tend to be deep-rooted…exploring them can be analogous to drilling a tree from the top-down. In the shallow part of the system, one finds the upper ‘branches,’ or gold-bearing lodes, but as exploration persists…bigger ‘branches,’ or lodes, are encountered.  

“What is most exciting about this discovery is that now that we have a clear idea where the deep fluid-tapping conduit of this system is located…alkaline gold systems are known to persist to great depths, sometimes as deep as 2 km. Considering this intercept is only approximately 500m below surface, this discovery is wide open for growth at depth,” he added.  

The company also said that the three nearest drill holes to TUG-141 returned high-grade mineralization previously. TUG-135, located 70 metres below the whole for instance, returned a result of 24.92 grams gold per tonne over 3.70 metres starting from 415.7 meters.  

Drill hole TUG-136, located 45 metres to the east of TUG-141, returned a result of 87.83 grams gold over 1.5 metres starting from 445.1 metres.  

Lion One’s ongoing drill program is taking a two-pronged approach, which includes shallow infill drilling to improve its current resource and deep drilling focussed on better understanding of the underlying “high-grade feeder network.” The latest discovery is a part of the latter program.   

At press time on June 6, shares of Lion One closed at $1.34, up 20¢ or 17.5%, after reaching a day-high of $1.44 and surpassing its previous 52-week high of $1.34.