New Found Gold expands Queensway’s Dropkick zone

New Found Gold (TSXV: NFG; NYSE-A: NFGC) reported high-grade intercepts at its Queensway gold project in Newfoundland and Labrador as it continues to expand the property’s Dropkick zone. Shares jumped.

Highlights of the drill results include 14.95 metres at 42.8 grams per tonne gold and 3.95 metres at 47.6 grams, New Found Gold said late Wednesday. In the nearby Pistachio zone, one drill hole intersected 5.34 grams over 7.3 metres. 

Based on the results received so far at Dropkick, New Found Gold plans to conduct follow-up drill testing starting in June, with work following at the soil anomaly located north of Pistachio. New Found Gold is also conducting a fully funded preliminary economic assessment of the project, with completion expected by July 1.

“Yesterday’s drill results remind investors of the exploration potential of Queensway,” BMO Capital Markets analyst Andrew Mikitchook said in a note Thursday.

Stock jumps

New Found Gold jumped 5.8% to $1.83 in late afternoon trading Thursday in Toronto. That gave the company a market value of about $367 million.

Recent drilling continues to yield new discoveries along the strike and down dip of known gold zones, the company said. These results point to the district-scale potential of the 175,600-hectare project, which covers a 110 km strike extent along two prospective fault zones.

“In these final drill results from the 2024 exploration program, we continue to intersect high-grade gold mineralization and expand both Dropkick and Pistachio,” President Melissa Render said. “The continued results from Dropkick and Pistachio, located 8 and 11 km north, respectively, of the main resource area at Queensway, are highly encouraging and point to the potential for future near-surface resource expansion along the strike of this prolific gold mineralized system. We look forward to continuing to test the tenor and extent of these zones.”

Expansion potential

Gold mineralization at Dropkick starts at surface and has been drilled to 285 metres vertical depth to date, the company said. Mineralization is open in all directions, with expansion potential of the high-grade toward surface.

“Regional targets like Dropkick highlight further discovery potential and should drive momentum in step with engineering and permitting,” SCP Resource Finance mining analyst Brandon Gaspar said in a note. “The major catalyst in our view is the June 2025 PEA providing a first look at the mining parameters of Queensway.”

New Found Gold has now released all drill results from the 2024 exploration program, which totaled 89,974 metres in 271 drill holes. The results of 37,750 metres in 82 holes were received after the cutoff date for inclusion in the initial MRE and will be included in the next MRE.