Unigold’s share price doubles on Dominican gold intercepts

Vancouver – Dominican Republic-focused Unigold (UGD-V) saw its share price double on news of some impressive gold intercepts from its Neita property in the country.

Hole LP17 hit 73 metres grading 2.36 grams gold per tonne from 252 metres depth, while hole LP20 returned 8 metres averaging 6.25 grams gold from 60 metres and then 37 metres averaging 1.48 grams gold from 121 metres. The company reports the intervals are true widths.

On news of the drill results Unigold’s share price jumped 16.5¢ or 97.1% to 33.5¢ with 6.7 million shares traded. The company’s share price last traded above 30¢ in early 2010 and kept below 18¢ for the past year.

Headline hole LP17 was collared roughly 100 metres southeast and drilled at a similar orientation to hole LP15, which hit 75 metres carrying 1.4 grams gold in early 2011 drilling. Unigold reports it extended hole LP17 from 333 metres to 450 metres in late 2011 and hit a further 100 metres of sulphide mineralization, though results for that section are not yet available. Holes LP19 and LP20 were collared a few hundred metres west of the main cluster of drill holes at the Candelones extension.

Unigold reports that the results extend mineralization at the Candelones extension of Lomita Pina to nearly a km. The main Candelones deposit, covering a defined gold-mineralization area of 400 metres by 400 metres and to a depth of 200 metres, sits about 3 km west.

The Candelones gold deposit sits on the opposite end of the 75-km-wide Cretaceous volcanic belt that also hosts Barrick Gold‘s (ABX-T, ABX-N) and Goldcorp‘s (G-T, GG-N) $3.7-billion, 23.7-million-oz.-gold Pueblo Viejo mine. At the Candelones deposit gold is hosted by an altered, silicified and brecciated dacitic rock and occurs within a high-sulphidation epithermal vein system.

The 226.2-sq.-km Nieta property sits in the northwest region of the Dominican Republic on the border with Haiti. The company has also optioned the adjacent Los Guandules property and controls the nearby Sabaneta property.

Unigold president and CEO Andrew Cheatle, who joined Unigold in late 2011, states the company will start 2012 with a 10,000-metre drill program to test the strike and dip extent of the extension. In early 2011 Unigold stated it planned to drill 15,000 metres in the second half of the year, but it is not clear how much drilling the company actually completed.

The Dominican Republic was hit by heavy rains in mid-2011 that led to flooding and mudslides. The rainfall required remediation of the Pueblo Viejo starter tailings dam and pushed back the start of production from late 2011 to an expected mid-2012.

Unigold spent $1-million on exploration in the second quarter of 2011 and $883,000 in the third as it completed an induced polarization survey on the Candelones and MGN targets at Neita. As of September 30, 2011 the company had $1.5-million on hand, but Unigold has since completed a $2.1-million financing at 10¢ per unit and now has 173.8 million shares outstanding.