Underground at Brucejack (Company)

Underground at Brucejack (Company)

Bob Quartermain’s beat up, Pretium Resources (PVG:TSX) has released assay results from ten underground holes and provided a more positive update on the ongoing 10,000-tonne bulk sample work.  Highlight assay results include 12.22m of 201.21g/t gold uncut including 0.5m of 4,830g/t gold uncut.  The drilling continues to intersect super high-grade and narrow veins of roughly 0.5m widths which continue to be of concern to the investment community at large.  The latest ten holes were drilled in Domain 20 which is located to the east of the bulk sample area.  Pretium also announced that the check screen fire assays will now be routinely as part of the bulk sample program due to the fact that recent fire screen assays of the flotation concentrate encountered coarse gold which could make the mill under-report gold grades.

The company reaffirmed their target of 4,000 ounces of produced gold from the 10,000-tonne bulk sample indicating an average grade of 13.5g/t gold.  The company is working towards an updated Mineral Resource estimate which will include 16,789m of underground drilling and mill results from processing the bulk sample material.  The results of the bulk sample as well as the update Mineral Resource estimate will be vital in determining whether the investment community will jump back on the PVG train, or not.

Continuity of grade and the ability to cost effectively mine narrow, super high-grade veins continues to be a concern for investors.  PVG was burning $4 to $5 million per month from Q1 to Q2 of this year.  At that rate, the company’s remaining $30 million, as disclosed in their second quarter results, is now probably closer to $15 million today (if not less).  Given that the last raise was done at $10.10 per share, investors are likely to remain concerned not only about grade dilution, but also share dilution as any raise done in the near-term will not be at attractive prices.

Here's the YTD chart:

PVG Chart

Read: More High Grade Gold Encountered in Underground Exploration Drilling; Bulk Sample Update