Fire Creek drilling

Fire Creek Drilling Targets For 2015. (Image: Klondex)

Klondex Mines (KDX:TSX) - Klondex a top performer in the gold space is out with drilling results on the Hui WU Vein. The Hui WU Vein is located at the Fire Creek project in Nevada.

Highlights of Hui Wu vein include:

  • 13.5 ounces per ton (461.6 grams per tonne) gold equivalent over 11.5 feet (3.5 metres) -- FCU-0214;
  • 5.1 ounces per ton (174.3 grams per tonne) gold equivalent over 3.2 feet (one metre) -- FCU-0328;
  • 64.0 ounces per ton (2,194.7 grams per tonne) gold equivalent over 1.1 feet (0.3 metre) -- FCU-0357;
  • 1.5 ounces per ton (52.7 grams per tonne) gold equivalent over 12.3 feet (3.7 metres) -- FCU-0213;
  • 2.1 ounces per ton (72.0 grams per tonne) gold equivalent over 4.4 feet (1.3 metres) -- FCU-0360

Brian Morris, Klondex vice-president, exploration, comments: "These results continue to demonstrate the high-grade nature of the Fire Creek deposit and its exploration opportunity. Assay results from development on the Hui Wu vein compare favourably to the predicted M&I mineral resource grade of 0.47 ounce per ton gold equivalent. Additionally, the recent drilling was not included in the mineral reserve estimates but is expected to be included in the updated mine plans for Q3. We are continuing the exploration drift to the north, as per schedule, with drill results expected to be released in the second half of 2015."

klondex 1 yr chart

Klondex 1 year chart (Image: Stockcharts.com)

Klondex continues to deliver in 2015 with a nice move to the upside. Q1 profits released on May 12th showed net income of $10.1 million (8 cents per share).

Klondex operates two mines Midas and Fire Creek which are two of the highest grade mines in North America.The high grade mines lead to low all in sustaining cash costs and strong free cash flow.

Klondex has stated they will use ~$30 million for exploration and development in 2015.

Cash balance at the end of March was $54.9 million.

Haywood Securities has a price target of $3.50 on Kondex shares.

Read: Klondex Drilling at Fire Creek Intercepts 13.5 opt (461.6 g/T) over 11.5 feet (3.5 metres); Begins Development for Long Hole Stoping on Hui Wu Vein 

Related: The CEO of this Nevada gold producer is "all in"

Mart Resources - (MMT:TSX) - Mart is out with its monthly production results for the month of April. Total production was ~266,970 from the Umusadege field in Nigeria.

Mart is still having issues with pipeline loss reporting 240,980 barrels delivered into the pipeline but only 201,280 after losses.

Another issue still hampering Mart is downtime which was 10 days in April.

Mart shareholders will be voting on a takeover offer from JV partner Midwestern Oil and Gas at the AGM on June 15th.

The offer is for 80 cents and Mart shares are currently trading at 64. The market is questioning if Midwestern will be able to complete a financing and close the deal.

Mart Resources 5 year chart

Mart Resources 5 year chart

A roller coaster ride for Mart shareholders over the past several years as a takeover offer in 2009 for 14 cents a share failed to close. Mart went on to have drilling success sending the share price to the $2 level in 2013 as well as paying out dividends.

I could possibly see a scenario where Midwestern fails to close this transaction. Could it be Deja Vu for long time Mart shareholders?

Read: Operations and April 2015 Production Update

Related: Nigerian oil play Mart Resources has turned a corner... I hope!

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This is not investment advice. All facts are to be checked and verified by reader. As always please do your own due diligence.