DE GREY Mining is hailing a potential major gold discovery at its Hemi prospect in the Pilbara region of Western Australia.

6 February 2020 | Michael Quinn

“Substantial thick and high-grade gold mineralisation (has been) intersected on two sections 640m apart,” De Grey said, with one section reporting aircore hits such as 24m at 7.5 grams per tonne from 126m and the other 24m at 4.2gpt from 36m.

“We currently interpret that the two mineralised zones are structurally related, suggesting we could be drilling a major new gold discovery,” De Grey said.

A large number of assays remain outstanding.

Aircore drilling is continuing to define the lateral extent, orientation and potential scale of the mineralised system, while follow-up RC and diamond rigs are being mobilised with a view to establishing an initial inferred resource.

Hemi lies in the heart of De Grey’s Mallina Province exploration acreage in the Pilbara Craton, and is the most promising new prospect within the junior’s overall Pilbara gold project.

The project currently contains 1.7Moz grading an average of 1.8gpt with five main deposits over a 50km area.

The company’s stated target has been to define 3Moz, with a 2 million tonne per annum processing operation being the flagged development scenario.

Results of studies on the potential economics of such a development have been expected this quarter.

De Grey has been contending comparisons can be made with the underexplored Pilbara Craton (that’s been thus far shown to contain 8 million ounces), and the highly explored, 200Moz Yilgarn Craton in southern WA.

De Grey’s major backers are the Ed Eshuys-led DGO Gold, which as of late last year held 9.7%, while highly successful Canada-Australia gold miner Kirkland Lake held a sub-5% stake.

De Grey started the current quarter with A$8 million cash, having raised $5 million late last year when new shares were issued at 4.5c each.

Shares in De Grey were up 43% to 6.6c in late morning trade, capitalising the company at $71 million.