The De Grey Mining Limited (ASX: DEG) share price has stormed higher in early afternoon trade on the back of positive news about a major new gold find at one of its sites.
At the time of writing, the De Grey share price is fetching $1.29, up 17% compared to the All Ordinaries Index (ASX: XAO), which is up 1.5% to 6,238 points.
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What did De Grey report?
Earlier today, De Grey updated the market with the finding of new major gold deposits from drilling of its Aquila site at the Hemi gold discovery, located 60 km south of Port Hedland in Western Australia.
The company reported a new altered intrusion of 1.8 km long and up to 80 metres thick, logged in wide-spaced aircore drilling. Whilst De Grey continues to further drill over the 1.5 km space, the initial aircore results included:
- 21m @ 3.4 grams per tonne (g/t Au) from 40m and 19m @ 2.1g/t Au from 68m in BXAC501 (ends in mineralisation)
- 12m @ 2.0g/t Au from 93m in BXAC502 (ends in mineralisation)
- 21m @ 1.1g/t Au from 102m in BXAC506
- 29m @ 1.3g/t Au from 56m in BXAC546 (using a 0.3g/t lower cutoff)
Furthermore, the follow-up RC and diamond drilling showed consistent gold mineralisation with intense brecciation and alteration. Additional results included:
- 58m @ 2.1g/t Au from 64m in HERC232 (section 7691640N)-visible gold reported 5 August 2020
- 11m @ 1.2g/t Au from 199m in HERC231 (section 7691640N)
- 24m @ 0.8g/t Au from 167m in HERC233D (section 7691720N)-ended in mineralisation
- 31m @ 1.3g/t Au from 88m in HERC234 (section 7691800N)
De Grey advised that gold mineralisation has remained open beyond the current 1.8 km strike and is at depth.
What did management have to say?
Commenting on the positive findings, De Grey managing director Glenn Jardine said:
The discovery of the Falcon intrusion demonstrates the potential to significantly grow the gold endowment at Hemi as we expand our drilling footprint.
Reinterpretation of the overall geology shows the Aquila intrusion strikes for 1.2km in a southwest orientation and the new Falcon intrusion strikes for over 1.8km in a distinctly north-south orientation. Aircore drilling is continuing to track the Falcon intrusion to the south.
Jardine confirmed that the company has two aircore rigs in operation and is actively pursuing opportunities to extend the Hemi site and to identify "similar large scale, near surface Hemi-like intrusions in the Greater Hemi area".
About the De Grey share price
The De Grey share price has stormed an astonishing 2,015% since the start of the calendar year. Although the gold mining company had a small hiccup between the end of June and middle of July, dropping 40%, it has since recovered reaching an all-time high today of $1.30.
De Grey is now valued at a market capitalisation of $1.51 billion.
Should you invest?
I think that a little bit of gold exposure is good for every portfolio. Personally, I would opt for established gold mining companies like Newcrest Mining Limited (ASX: NCM) or Northern Star Resources Limited (ASX: NST), so would only suggest allocating an extremely small portion of your investment funds to smaller exploration companies like De Grey.
As promising as the results look, and the traction the metal mining outfit has gained, it still remains a risky play. I will be adding De Grey shares to my watchlist for now.
