Break of Day resource makes the grade for Musgrave

Special Report: Musgrave Minerals has confirmed its Break of Day discovery in Western Australia’s Murchison region as one of the highest grade undeveloped gold deposits in the country following the release of a much-anticipated resource update.

Musgrave (ASX: MGV) has been one of the standout small gold stocks on the ASX this year following the discovery of the new Starlight and White Light lodes at Break of Day, part of its Cue Gold Project in the Murchison.

Starlight and White Light have produced multiple high-grade, near-surface intercepts in drilling since May.

In announcing the resource update on Wednesday, Musgrave said the two new lodes hosted an indicated and inferred Mineral Resource of 360,000 tonnes grading 13.9 g/t Au for 161,000 ounces of contained gold.

Following a reinterpretation of the geology and orientation of the other lodes at Break of Day, the deposit’s Indicated and Inferred resources now stands at 797,000 tonnes at 10.2 g/t Au for 262,000 ounces of contained gold.

Commenting on the resource update, Musgrave managing director Rob Waugh said: “This is a significant milestone for the company with ongoing focus on grade and margin.

“It confirms Break of Day as a standout high-grade, near-surface gold deposit that will largely be amenable to open pit mining.”

Few undeveloped gold resources in Australia carry as high a grade as Break of Day.

Bellevue Gold’s namesake project near Leinster in WA has a resource of 2.3 million ounces at a grade of 10 g/t Au and Ramelius Resources’ Penny project near Youanmi in WA has a resource of 300,000 ounces at 15 g/t Au.

However, both these projects will be developed primarily as underground operations.

For context, gold industry research firm Aurum Analytics reported that the average open pit mill feed/head grade for Australian producers in the June 2020 quarter was 1.1 g/t Au.

This is a pointer to how profitable a mining operation at Break of Day could be.

Adding to the development prospects of Break of Day, the nearby Lena deposit contains an inferred and indicated resource of 4.3 million tonnes at 2.3 g/t for another 325,000 ounces.

Incorporating Break of Day, Lena and several smaller deposits, the updated total Indicated and Inferred Mineral Resources for the Cue Project now stands at 6.4 million tonnes at 3.2 g/t Au for 659,000 ounces of contained gold.

Musgrave owns 100% of these resources.

Starlight and White Light were discovered when Musgrave flipped the script of the accepted wisdom in regards to the orientation of gold mineralisation at Break of Day and have given the company a new model for targeting additional discoveries in the area.

Armed with this new information, Musgrave is continuing with a regional drilling program testing new targets and has already had some success with interesting results returned from two prospects.

High-grade gold has been intersected near surface at both prospects, with follow-up drilling underway.

This story was developed in collaboration with Musgrave Minerals, a Stockhead advertiser at the time of publishing.

This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.