West Red Lake books high-grade gold at Madsen

Underground drilling at West Red Lake Gold Mines’ (TSXV: WRLG; US-OTC: WRLGF) primary Madsen property in Northwestern Ontario yielded multiple instances of high-grade gold, the company said.

Highlight hole MM25D-12-4860-004 in the lower Austin zone cut 7.75 metres grading 139.45 grams gold per tonne from 37 metres depth, West Red Lake said Thursday in a statement. Hole MM25D-12-4860-005, meanwhile, intersected 8.7 metres at 74.7 grams gold from 37.1 metres downhole.

Vancouver-based West Red Lake, backed by Canadian Mining Hall of Fame member Frank Giustra, is continuing exploration work at Madsen even as it ramps up production at the past-producing mine, having restarted operations in May. The lower Austin zone will continue to be a key focus of drilling for the remainder of 2025, West Red Lake said.

“There is significant ounce and tonnage potential remaining at depth in the Madsen orebody,” CEO Shane Williams said in the release. “We anticipate continued success in lower Austin as the drills continue to discover and define more lenses of high-grade mineralization adjacent to our active mine development.”

West Red Lake shares jumped 7% to $1.07 Friday morning in Toronto, giving the company a market value of about $376 million. The stock has traded between 52¢ and $1.18 in the past year.

Resource expansion

Crews at Madsen are working to define the near-term mining inventory and expand the resource, West Red Lake says. Work has focused on the more continuous and higher-grade portions of the Austin, South Austin, North Austin and McVeigh zones, which will continue to be the strategy through 2025, the company said.

Madsen hosts 6.9 million indicated tonnes grading 7.4 grams gold per tonne for contained metal of 1.65 million oz., and 1.8 million inferred tonnes grading 6.3 grams gold for 370,000 of contained metal, according to a December 2021 resource.

Other highlights released Thursday include hole MM25D-12-4860-002, which cut 7.45 metres grading 18.31 grams gold from 39.65 metres depth, and hole MM25D-12-4860-009, which intersected 3.9 metres 13 grams from 48.45 metres downhole.

With historical production of more than 30 million oz., the Red Lake camp remains one of Canada’s highest-grade gold districts. West Red Lake, whose land package covers 47 sq. km, is part of a group of core producers in the area that also includes Australia’s Evolution Mining (ASX: EVN) and Kinross Gold (TSX: K; NYSE: KGC).

Turnaround

Madsen produced 35,700 tonnes of ore during the third quarter at an average grade of 5.4 grams gold per tonne, West Red Lake said earlier this week. The mill poured 7,055 oz. gold. 

West Red Lake “has rapidly worked to turn around the asset since acquiring it in 2023 and can now take advantage of the robust gold price environment,” Red Cloud Securities mining analyst Taylor Combaluzier said in a note this week.

The company is one of the first explorers that former film company executive Giustra invested in. He once said that strong hits at West Red Lake’s Rowan property helped him “see the light” about backing early projects.