Bob Quartermain's Pretium Resources (PVG:TSX) should see some much need relief this morning after announcing they have surpassed their 4,000 ounce target production rate from the 10,000-tonne bulk sample being done on the Valley of the Kings material. PVG has produced 4,215 ounces of gold from 8,090 dry tonnes of material with approximately 1,815 wet tonnes still remaining to be processed. The ounces imply a grade of approximately 17g/t gold which is better than the expected 13.5g/t gold implied by 4,000 ounces of gold from 10,000-tonnes of bulk sample material. This also, importantly, shows that the average grade estimated in their current resource model of 13.5g/t gold is accurate (or roughly accurate). This is significant.
This result is a large improvement over the first bulk sample results which were released in late October which showed 281 ounces of gold from the first 2,167-tonnes of bulk sample material which implied a grade of approximately 4g/t gold.
Processing is continuing on track and is expected to be completed by the first week of December (after a week-long mill shutdown for the United States Thanksgiving holiday). Shipment and sale of the gravity concentrate have commenced, with shipment of the flotation concentrate to commence on completion of processing. The final amount of gold production will be announced at the end of processing and assaying, which is expected by mid-December.
This should give the stock some relief from the pressure it has been under following the resignation of Strathcona Mineral Services which raised significant questions about the accuracy of PVG's current resource estimates as well as the bulk sample program. With these latest results surpassing the 4,000 ounce target, with more material still to be processed (and they are processing the material lowest to highest grade so most of the remaining material should be the same or higher grades), this should provide confidence as to the grade continuity of grade of the Valley of the Kings material.
Shares have fell earlier this year when the bottom fell out of the gold market, but then plummeted in October after the Strathcona debacle leaving shares down 75% this year.
Read: Pretium Resources Inc.: Bulk Sample Surpasses Target of 4,000 Ounces of Gold; Processing Continues