Key points:
- The Excellon Resources share price soared 116.3% premarket.
- Excellent gold deposits at its Kilgore mine fueled the rally.
- The firm is yet to produce gold and cannot benefit from the high prices.
The Excellon Resources Inc. (NYSEARCA: EXN) share price soared 116.3% during premarket trading after announcing the possibility of having high-grade gold deposits at its Kilgore Project in Idaho.
The company’s Kilgore gold project is regarded as a high-return gold project with minimal capital expenditures. The firm also has two high-grade silver projects in Mexico, the Platoma mine and the Evolución silver project.
Also read: The Best Gold Stocks to Buy Right Now.
Excellon Resources also has another silver project in Germany known as the silver City project located in the Saxony region that is mining-friendly.
The company revealed that the Kilgore deposit had an indicated gold resource of 44.6 million tonnes at 0.58 g/t Au for 825,000 ounces Au and an Inferred Resource of 9.4 million tonnes at 0.45 g/t Au for 136,000 ounces Au.
Investors cheered the news given the rising global gold prices as investors flock to the yellow metal as a hedge against record-high global inflation levels.
However, investors should remember that Excellon Resources is yet to start producing gold, which means it cannot benefit from the current high gold prices.
The company also unveiled its 2022 exploration plan, which looks to achieve two overarching goals, to grow and increase the grade of the existing mineral resource and define vertical to sub-vertical high-grade zones within the existing mineral resource.
Therefore, it will take a while before the first gold is mined at Kilgore when gold prices might have receded.
Jorge Ortega, Excellon’s Vice President of Exploration, said: “The opportunity to define high-grade gold and make new high-grade discoveries was a key reason behind our acquisition of the Kilgore Project in 2020,”
Adding:
“We are applying a modern approach to historical data and plan to deploy more advanced surveying techniques in the upcoming drill campaigns at Kilgore. Historic results demonstrate numerous high-grade intervals throughout the deposit lithology, often associated with silicified zones but with minimal associated structural analysis. In this year’s program, we aim to delineate the structures associated with high-grade gold emplacement through drilling, geophysics and continued surface exploration to expand our understanding and the potential of the deposit and project.”
Excellon Resources shares had given up some of their gains at writing but were still up 80%.
*This is not investment advice. Always do your due diligence before making investment decisions.
Excellon Resources stock price.
Excellon Resources’ stock price soared 116.33% premarket to trade at $2.12, rising from Thursday’s closing price of $0.98.