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London
March 3, 2024
PI Global Investments
Silver

Co. Finds Parallel Gold & Silver Veins in Nevada


This gold company is exploring its 100%-owned project in Nevada, which one analyst called “one of the most attractive mining jurisdictions in the world.


Western Exploration Inc. (WEX:TSX.V;WEXPF:OTC) announced final assay results and structural interpretation from its 2023 core drilling program in the Jarbridge rhyolite northeast of the Gravel Creek resource area on its Aura gold and silver project in Nevada.

Two core holes were drilled to evaluate the resource expansion potential in the northeast mineralized vein and breccia trends there.

Hole WG457 reported assays of up to 257 grams per tonne gold (g/t Au) and 1,655 g/t silver (Ag), including 0.7 meters of 143.56 g/t gold equivalent (Au Eq) and 1 meter of 67.49 g/t Au Eq. Hole WG456 reported 2,800 g/t Ag.

Western Exploration said the 2023 core data and previous surface mapping has confirmed a series of northwest- and northeast-trending structures with high-grade epithermal gold and silver mineralization over a 550-meter- by 350-meter area immediately adjacent to the current Gravel Creek resource.

“I’m glad to say that the two drill holes we’ve completed . . .  were able to link a lot of those high-grade intercepts up into a more meaningful zone of northeast and northwest-trending,” Western Exploration Chief Executive Officer Darcy Marud said in a video posted to the company’s website. “We’ve identified two parallel veins over 200 meters so far.”

“The Aura gold-silver project in Nevada (is) one of the most attractive mining jurisdictions in the world,” Fundamental Research Corp. analyst Sid Rajeev wrote. He has rated the stock a Buy with a fair value of CA$3.48 per share.

Marud said the breakthrough identifies “significantly expanded resource potential in the Jarbridge rhyolite to the east/northeast of the current Gravel Creek resource area,” justifying more drilling there.

According to an updated mineral resource estimate (MRE), Gravel Creek has a resource of 245,571 Au Eq ounces at 5.81 g/t Au Eq in the Indicated category and 442,814 Au Eq ounces at 5.02 g/t AuEq in the Inferred category.

Previous drilling hit multiple high-grade silver- and gold-bearing vein intercepts of up to 40.05 g/t Au and 1951.0 g/t Ag in the Miocene Jarbidge volcanics overlying and lateral to the Gravel Creek deposit, the company said.

“None of these Jarbidge-hosted intercepts have been included in previous resource estimates,” the company said in a release announcing the two new holes.

Catalysts: High Grades, Production Potential

Analysts in the sector are paying attention to the company.

“The Aura gold-silver project in Nevada (is) one of the most attractive mining jurisdictions in the world,” Fundamental Research Corp. analyst Sid Rajeev wrote. He has rated the stock a Buy with a fair value of CA$3.48 per share.

“We believe WEX’s primary strengths are its high-grade Doby George project with near-term production potential, a strong management/board, and Agnico Eagle’s backing,” he wrote.

Gravel Creek and Wood Gulch account for 60% of the project’s resources, Rajeev noted. Doby George accounts for the rest.

“Doby George’s resource (40% of total resources) is amenable to heap leach processing, indicating the potential for relatively low OPEX/CAPEX,” according to Rajeev. “WEX is planning a resource expansion/step-out drill program, followed by a Pre-Feasibility (study or PFS) in 2024. We believe this deposit can be advanced to production quickly at a low initial CAPEX (<US$50M). Based on its existing resource, we believe the project has the potential to operate for nine years (40-50 Koz/year) at a relatively low OPEX (US$800/oz).”

Technical Analyst Clive Maund rated the stock a Speculative Buy and wrote that the stock looked “like a Buy here for a reversal into a recovery.”

Western announced 69.3% gold extraction at Doby George in July. Technical Analyst Clive Maund rated the stock a Speculative Buy and wrote that the stock looked “like a Buy here for a reversal into a recovery.”

Further drilling is planned on Gravel Creek and Doby George in the third quarter of 2024, and a preliminary feasibility study (PFS) for Dolby George is expected in the last quarter of 2024. 

Precious metals mineralization was initially discovered at the project at Doby George in the 1960s, but it wasn’t until the 1980s that Homestake Mining Co. discovered the Wood Gulch deposit.

A Good Jurisdiction

The project is 100% owned by Western and is about 32 kilometers north of the Jerritt Canyon Mine in an under-explored area of Nevada, the largest gold-producing state in the United States.

The drilling is testing a northeast-trending structural corridor hosting high-grade, low-sulfidation epithermal veins in the Jarbidge rhyolite peripheral to the Gravel Creek resource, the company said.

Previous drilling has intersected multiple gold- and silver-bearing vein intercepts there with grades up to 40.05 g/t Au and 1,951 g/t Ag.

A cross-section through the deposit shows intercepts of more than 30 g/t Au Eq (gold equivalent) in the Jarbidge rhyolite lie between the 1,500- and 1,750-meter elevation range. None of these intercepts have been included in previous resource calculations, the company said.

What do those grades mean? According to Stockhead, grades of 1 g/t Au can make an open-cut project viable, with anything over 5 g/t Au is considered high-grade.

“Consider a company’s average grades and look for drill cores that ‘start and end in mineralization’ rather than buying shares on just one excellent drill core result, as well as the scale of the deposit,” the website noted.

Ownership and Share Structure

According to Reuters, about 74% of the company is owned by strategic investors.

This includes Golkonda LLC, a syndicate of dozens of high-net-worth investors, which owns about 58% of the company, and Agnico, which owns 16%.

Management and directors own about 7%, and other institutions own about 12%, the company said.

The rest is retail.

Western Exploration has a market cap of CA$26.18 million and has 34.45 million shares outstanding. It trades in a 52-week range of CA$2.28 and CA$0.455.

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Important Disclosures:

  1. Western Exploration Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000. In addition, Western Exploration Inc. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Exploration Inc.
  3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
  4. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

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