Special Report: Chesser led the market yesterday after reporting some thick, high-grade gold hits, but exploration is still in the early stages and there is plenty more news to come.

Managing director Mike Brown told Stockhead the drilling results Chesser Resources (ASX:CHZ) had received to date from its flagship Diamba Sud project in Senegal were encouraging as they could be representative of what is really there.

Shares in Chesser soared 176 per cent to 29c yesterday after the company reported that drilling at the Area D target hit shallow, thick high-grade oxidised gold mineralisation across a 200m wide zone in five adjacent holes.


Chesser Resources (ASX:CHZ) share price chart



Top results included 48m at 6.7 grams per tonne (g/t) gold from 24m including 10m at 25.14g/t gold from 62m, 55m at 4.27g/t gold from 16m and 18m at 4.63g/t gold from 8m, including 4m at 18.3g/t gold from 30m.

Oxidised mineralisation is typically easy and cheap to process, though Brown warned that it was still too early to say if this was true for what the company had struck at Area D.

Brown added the company had some good hits at the Western Splay target with shallow, wide zones returning individual grades of up to 20g/t.

Results are still pending for drilling at Area A, which will wrap up this round of drilling.


Drilling attack

But this is just the beginning, Chesser is looking to carry out a far larger program of between 15,000m and 20,000m of drilling in October after the wet season to follow-up on the results from the recent circa 4,000m drilling program.

“In October we will go back to Area A and look at this new southwest extension and infill drilling there to push towards a resource,” Brown told Stockhead.

“In Area D, we have this open zone of mineralisation that is open in every direction except the southeast.

“We will need to drill that, put some diamond holes into that as well to try and understand the controls on it.”

Brown said drilling at Western Splay would be greenfields scout drilling to look for structures and zones where the company could potentially find splays and high-grade shoots.

“That was what Fekola was based around. It was a reasonably low-grade structure until they found the high-grade shoot. We will be looking for that kind of structural setting and mineralisation model,” he explained.


Big, low-cost mines in West Africa

The Fekola mine on the border between Mali and Senegal produced 164,011oz of gold during the first quarter of 2020 at a low all-in-sustaining cost of $US519 per ounce sold. It has estimated reserves of 4.25 million ounces.

Chesser will also be carrying out some initial metallurgy on the mineralisation in Area A.

“We just need to check if it might be refractory or not. We don’t expect it is, but we want to make sure,” Brown added.

He noted that gold prices were very encouraging, and Senegal was still one of the go-to West African jurisdictions.

Orogenic gold deposits where we are can get very large, so the potential of the prize is very large and significant and that’s what makes it so interesting,” Brown said.

>>NOW LISTEN TO: RockTalk: Insiders views on the West African gold rush

This article was developed in collaboration with Chesser Resources, a Stockhead advertiser at the time of publishing.

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