AM Gold ups inferred resource at Red Mountain

Vancouver – AM Gold (AMG-T, AMX-F) has released a resource update for its Red Mountain gold project in the Yukon that adds significantly to contained gold only six months after an earlier update.

The new estimate for the Tintina Gold Belt-based project is an inferred resource of 79.3 million tonnes grading 0.5 gram gold per tonne for roughly 1.32 million contained oz. gold. That marks a 140% increase in contained oz. from the May resource that had 24 million tonnes grading 0.7 gram gold for 542,000 contained oz.

The updated resource uses a cutoff of 0.2 gram gold and is based on 6,600 metres of drilling over 24 holes. The mineralized area has been established over a strike length of roughly 700 metres and to a depth of upwards of 500 metres, while the average depth of holes was 275 metres. Holes were spread across 22 section lines spaced at 25 and 50 metre intervals.

Mineralization at the property is cut by a northwest trending fault zone known as the Jethro Structure. The company describes mineralization at Red Mountain as being hosted in quartz monzonite porphyry intrusive rock and associated with broad zones of disseminated sulphide, while higher-grade gold is associated with areas of steeply dipping sheeted sulphide-bearing quartz vein zones.

Only days before releasing the update AM Gold announced the results of drill hole 37, which was drilled off the main Jethro Trend and pushed known mineralization 270 metres northeast of hole 28 that was released in late September.

Hole 37 hit 233 metres grading 0.36 gram gold in porphyry intrusive rock and ended at 253 metres with 5.5 metres grading 0.83 gram gold. The hole, however, was collared too far from the established resource to be included in the resource update.

In all AM Gold drilled 4,100 metres over 12 holes this year to expand the resource area without closing off the resource in any direction.

AM Gold’s share price was down 2¢ to close at 63¢ on the day. The company, however, has climbed from roughly 28¢ in late August since securing full ownership of Red Mountain and releasing drill results from a summer exploration program.

The company also controls the Pinaya project in Peru, which hosts a resource estimate of 29.13 million indicated tonnes grading 0.53 gram gold per tonne and 0.42% copper, and an additional 12.72 million inferred tonnes grading 0.41 gram gold and 0.41% copper.