Buritica currently hosts over 1.6 million ounces of gold at an average grade of 13.6g/t gold (source: Bloomberg)

Buritica currently hosts over 1.6 million ounces of gold at an average grade of 13.6g/t gold (source: Bloomberg)

The high-grade veins at Continental Gold's (CNL:TSX) Buritica project in Colombia continue to grow as drilling expands the areas of known mineralization.  This morning, Ari Sussman (CEO) announced the latest batch of 17 drill holes from his project.  Four of the holes were successful in intersected veins sets that were 200m west of the current technical report block model for the Yaragua system, representing an extension of the Yaragua southern, central and northern vein families.  These all appear to remain open along strike to the west and to depth.  These include 0.5m of 119g/t gold at an elevation of 897m and 0.9m of 76g/t gold at an elevation of 1,294m.

Two other holes intersection the San Agustin area to the north of the Yaragua block model and remain open in all direction.  Continental plans to follow-up with this area in their 2014 drill campaign.

Of importance with these types of projects is how closely the head grades at the processing facilities mirror the grades estimated by drilling in resource estimates.  At Buritica, Continental is almost complete the processing of Level 0 material through the old Yaragua mill which show recovered grades that exceed the current grades estimated by the technical report.

Furthermore, infill drilling continues to intersect vein grades and thicknesses that exceed those seen in the resource estimates.  This is also significant for the overall accuracy of the model.  Highlights of infill drilling include:

  • 5.05m of 48.1g/t gold an elevation of 1,404m
  • 4.6m of 13.5g/t gold at an elevation of 1,506m
  • 6.4m of 10.8g/t gold at an elevation of 1,425m

"These drill results continue to demonstrate the growth potential at Yaragua while satisfactorily upgrading the confidence level of the resources within the existing deposit," commented Ari Sussman, CEO. "Our updated resource estimate is scheduled for early in 2014 and the results in this release plus favourable assays due in early January will be incorporated into the next estimate."

Drilling also extended the Murcielagos and Murcielagos South vein families which are more than 100m to the west of the Yaragua block model.

The most explored areas of the Buritica project are the Yaragua and Vet Sur systems. Yaragua related mineralization has been encountered along 900m of strike and 1,300m deep and partially sampled in underground developments. The Veta Sur system has been identified along 700m of strike and 1,300m deep.  Both are steeply-dipping veins combined with more disseminated mineralization.  They both remain open along strike and at depth.

Continental is almost complete the processing of underground material (source: Continental Gold)

Continental is almost complete the processing of underground material (source: Continental Gold)

The 2013 drill campaign is now complete with remaining assays for the program to be released in early 2014.  Further drilling will continue into 2014 with the goal of increasing measured and indicated resources by upgrading inferred resources.  An updated resource model is expected within the early parts of 2014 as well.  After drilling and permitting activities are completed in 2014, the company will have spent roughly $60 million of their just under $130 million in cash.  We expect them to file the amendment to their permit application by early 2014 as well.  As these initiatives are completed, the project will become further derisked, providing more assurances to the many likely suitors of a project of this caliber.  Next year is set to be a critical and transformative one for Continental Gold.

Read: Continental Gold Drills and Samples High-Grade Gold in the Yaragua System at Buritica, Colombia (The Wall Street Journal)