Coral Gold shareholders may be keeping a close eye on drilling activity at the Renaissance Gold (REN) Ecru project which is located just to the north east of the Barrick Gold (Sunny; ABX) Robertson project. As John Kaiser explains in his November 7th Discovery Watch broadcast, Renaissance has optioned up to 70% of the project to Australia-listed S2 Resources which has a drilling program underway now that includes deep target holes.
Image source: Renaissance Gold
According to Kaiser the dream with Robertson has been to drill deep to find high grade gold.
The hope always was let's drill deeper, let's find that really high grade stuff that 10 to 20 gramme per tonne gold stuff that makes Cortez Hills, Gold Rush and Pipeline tick. But it really hasn't happened.
The activity at Ecru is important for Coral Gold (CLH) for at least two reasons. First, Coral Gold sold the Robertson project to Barrick in 2017 for just over C$20 million and the deal included a sliding scale 1% to 2.25% net smelter returns royalty. There is also a provision that Barrick will begin paying an advance annual royalty payment in 2025 of US$500,000 if the property is not placed into production by December 2024.
Secondly, according to Kaiser the current approach being pursued by Barrick is to develop shallow gold mineralization:
It has been a frustrating situation for Coral Gold shareholders while Barrick now plods towards some sort of open pit heap leach operation targeting the near surface oxide resources.
Consequently, the decision by S2 Resources to drill deeper right next door at Ecru could shed new light on deeper potential at Robertson. As Kaiser explains:
If they do make a discovery there, it will be very interesting for Coral Gold as it will put pressure on Barrick to drill deeper to find out what's there
As for timing, S2 Resource is currently planning to drill 2 or 3 deep holes this fall and combining the results with geophyiscal work to potentially layout a 2019 exploration program. Kaiser is hopeful there will be some initial news before Christmas. A deep discovery could be a nice Christmas gift not only for Renaissance Gold, but also for Coral Gold shareholders.
You can find Discovery Watch Broadcasts each week on the Broadcast page of CanadianInsider.com or by visiting Howestreet.com.
