This Aussie gold stock is off to an absolute flyer in 2020. This is why…
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Special Report: It’s just a few days into the New Year and, with the gold price spiking to an eight-year high of over $US1600 ($2327) an ounce on Middle East tensions, Australian gold developer Bardoc Gold (ASX:BDC) has put itself front and centre of the scramble for “safe-haven” gold stocks.
Bardoc already boasts a sizeable gold resource inventory of over 3 million ounces at its namesake project located just 55km north of Kalgoorlie, in the heart of WA’s goldfields.
And it’s intent on growing that resource further, with drilling programs currently underway across a number of satellite deposits that form part of the consolidated Bardoc project, in addition to the three main deposits that make up the bulk of its resources.
On New Year’s eve Bardoc reported some results from recent drilling at one such prospect, the recently acquired Mayday North project, including intercepts of 14m grading 2.96 grams per tonne (g/t) gold and 18m grading 2.57g/t, including a higher-grade zone of 8m at 3.57g/t.
But it was an announcement earlier this morning that is likely to really capture investor attention, with recent drilling at the appropriately named “El Dorado” deposit in the southern part of the project returning what Bardoc says are some “outstanding” broad zones of high-grade mineralisation.
El Dorado currently has a relatively modest resource of 23,000oz, but that looks set to change quite rapidly as a result of the recent drilling.
Results of 11m grading 11.38g/t, including 5m at 23.34g/t from 200m, and 9m at 4.71g/t, including 5m at 7.63g/t, were reported from outside the current resource envelope.
Importantly, the new results tie in with results from this same area reported just before Christmas, including 10m at 5.77g/t and 28m at 13.59g/t.
“The drilling shows that there is a high-grade core to this new broad high-grade zone we have identified directly below the current resource envelope,” Bardoc Gold chief executive Robert Ryan says.
“And the grade appears to be improving with depth – which is an exciting development.”
So confident is Bardoc in the emerging potential at El Dorado that it mobilised a reverse circulation rig earlier this week to restart drilling at the emerging deposit.
“It serves as another reminder of the substantial exploration upside across our 3-million-ounce Bardoc project,” Ryan said.
Bardoc confirmed this morning that a pre-feasibility study based on the current 3 million ounce resource at the project was well advanced and on track to be delivered later this quarter.
“As gold reaches new record highs in Australian dollar terms of over $2,300 an ounce, our strategy of building a sizeable, high-quality resource in Australia’s premier gold district has positioned us well to become a sustainable producer,” Ryan said.
“PFS studies are progressing well with results expected later this quarter and, while our cornerstone deposits at Aphrodite, Zoroastrian and Excelsior are the focus of this study, our recent exploration successes show that there is still significant upside to our plan.”
Bardoc – which is led by the founders of lithium producer Pilbara Minerals (ASX:PLS) in chairman Tony Leibowitz and directors Neil Biddle and John Young alongside former Norton Goldfields executive Robert Ryan – has a clear strategy to turn the $110mcompany into one of Australia’s next gold producers.
With around $17min cash and liquid investments, the company says it is strongly placed to deliver on this vision.
But in the meantime, investors can look forward to plenty more news-flow from ongoing exploration programs, with drilling resuming this week across multiple deposits and prospects.
“With consolidation activity and investor interest in the Australian gold sector – particularly in the Kalgoorlie region – continuing to increase, this is a great time to be building a large gold resource base and laying the foundations for a long-term mining operation in one of the world’s Tier-1 gold districts,” Ryan says.
Towards the end of last year, Bardoc received a strong rating from highly-rated gold analyst John Macdonald from Hartleys based on its rapid success in building a large gold resource in the heart of WA’s Eastern Goldfields – and its plans to become Australia’s next 100,000oz-plus per annum gold producer.
In a research report, Macdonald placed a Speculative Buy recommendation and 16c price target on the stock (it’s currently trading around 8c), with the caveat that it was “influenced by valuations between 12c and 35c”.
He says Bardoc is examining the feasibility of co-ordinated open pit and underground mine development, and construction of a new ~2Mtpa ore treatment facility at the Bardoc project near Kalgoorlie.
Macdonald says that Aphrodite will be Bardoc’s baseload deposit. The deposit comprises two-thirds of project resources, complemented by an open cut mine at Excelsior and open cut and underground mines at Zoroastrian.
“Hartleys thinks Bardoc can potentially put +1Moz into undeveloped mine plans, backed by extensive drilling, mine scale sampling and studies,” he wrote.
“Hartleys models payable gold production at Bardoc of 100-150kozpa, in bullion and concentrate, at an AISC of $A1200-1400/oz from mid-CY2021. We presume upfront capital of $175mincluding $35mpre-strip earthmoving.”