Wesdome confirms high-grade gold in Falcon 7 zone at Eagle River mine

Wesdome Gold Mines (TSX: WDO) says it has confirmed high gold grades as it drills volcanic rocks near the Eagle River gold mine 50 km west of Wawa, Ont. The find is notable because gold at the Eagle River mine is usually hosted in diorite rocks.

Surface and underground drilling (from the 355-metre level exploration drift) defined the up-plunge of the Falcon 7 zone to within 50 metres of surface, intersecting strongly altered and mineralized quartz veins with visible gold.

Falcon 7 zone cores assayed 11.1 grams gold per tonne over 2.6 metres; 22.8 grams gold per tonne over 1.6 metres; and 20.3 grams gold per tonne over 1.5 metres (all true widths). All assays were capped at 125 grams per tonne.

A number of drill holes have intersected the hanging wall of the Falcon 7 zone, including one that returned 40.3 grams gold per tonne over 1.5 metres. This points toward the potential for parallel or folded limbs of the zone.

Underground at Wesdome Gold Mines’ Eagle River mine, 60 km southeast of Hemlo and 50 km due west of Wawa, Ontario. Credit: Wesdome Gold Mines.

Drilling completed in the central portion of the Eagle River mine diorite to test for the extension of the North Contact zone defined a new lens of gold mineralization, which is interpreted to be east of and along strike from the Mine 7 zone structure. One hole returned 27 grams gold per tonne over 4.6 metres. Drilling here will continue from underground platforms.

Wesdome president and CEO Duncan Middlemiss said the results from the Falcon 7 zone may indicate a new mining zone. The new mineralized lens in the diorite is accessible from existing underground infrastructure.

Initial surface drilling within the volcanic rocks 150 metres east and down-dip of the previously mined 2 zone intersected altered volcanic rocks with quartz veining and visible gold. One hole returned 233 grams gold per tonne over 0.4 metre.

The Eagle River mine is on track to produce 95,000 to 105,000 oz. of gold this year from material with a head grade of 12.1 to 13.4 grams gold per tonne.

Echelon Capital Markets analyst Ryan Walker wrote in a note published Wednesday that Wesdome’s organic production growth “solely in a Tier 1 jurisdiction” remains a highlight for the company. Echelon also emphasizes the potential for continued positive exploration results from drilling at Eagle River and Kiena in Val-d’Or, Que.  

“We look for improved operational performance in the quarters ahead, especially on the back of commissioning of the paste plant at Kiena (on track for Q422) which should help improve the mining rate ramp-up and speed up the mine’s production cycle,” Walker said.

Echelon maintains its “buy” rating for Wesdome shares.

Company shares were trading at $9.49 at late afternoon on Wednesday in Toronto. Its shares have traded in a 52-week window of $7.43 and $16.77. It has a market cap of $1.3 billion.