Renforth Resources Blasts Its Way To New 52-Week High Share Price

Earlier this year, in the midst of a global pandemic that led to the temporary shut down for much of the North American mining and exploration activity, Renforth Resources Inc. (CA:RFR – $0.05 & US:RFHRF – $0.04 & GER:9RR – €0.02) barely paused before resuming the frenetic pace of its efforts at the New Alger project immediately thereafter. Now during a heat wave in the dog days of summer, work has resumed yet again at the New Alger project. This week the Company reported that the next phase of fieldwork has commenced and things are set to become very exciting in a hurry for shareholders.

Renforth has blasted several mini-bulk samples. The Company has focused on several targets within the aptly named Discovery Vein deposit. Moving forward to the bulk sampling phase is a notable achievement. Few exploration prospects advance far enough to warrant the commitment. Moreover, favorable results from this program could tilt the balance towards a larger scale development decision.

New Alger’s Discovery Veins Eastern End, 2nd Blast.
Posted by Renforth Resources on July 15, 2020

 

There are several nearby processing plants that have excess capacity to arrange toll milling and processing of the sample material. This is ideal and will contribute towards lower expenses to complete the program. In addition, there is the potential that enough gold will be recovered from the sample material to offset the total costs and perhaps even generate positive cash flow.

The stature of New Alger as a legitimate development candidate would certainly benefit from that outcome. In effect, the program may provide the proof-of-concept validation to fast track Renforth towards a significant mining scenario.

 

Mini-Bulk Sample Process Will Contribute to Greater Confidence for Overall Gold Resource

It was not that long ago that Renforth achieved another important milestone for New Alger, with the presentation of the NI43-101 compliant resource report. This was based on some trenching work, but mostly on the analysis of drill core samples.

Now consider that the drill core is slightly more than 2 inches in diameter. And only half of the core is sent for assay. Given that Mother Nature unevenly distributes the gold resource within a large deposit area, it is quite possible that entirely different results may have been sampled if the drill core was shifted just a foot in either direction along the strike length of the mineralized system. And yet, that tiny sample amount is then used to project a much wider rock interval that may span fifty meters or more before the next data point is available.

What this means is that even a carefully prepared resource estimate may have a wide variance from the actual gold content for the deposit. By completing a mini-bulk sample, a much larger volume of rock is extracted and processed similar to the method of an actual open-pit mining operation. The blended grade of this rock mass can then be assayed prior to processing. And after the recovery process, a more accurate measure of the amount of gold produced can be determined.

One other bonus is that the blasting and sampling work is actually cheaper than diamond drilling. The resource zones outlined so far continue far below the most efficient pit shell design. Therefore deeper drilling work is a necessity as the scope of exploration continues down dip along this vein system. However, the near surface potential for this deposit will gain greater clarity through the bulk sample process.

Additional Exploration Drilling Work Scheduled to Commence

One attractive element to the resource estimate was the identification of a near-surface portion of the deposit that may become a candidate for open-pit mining. Comprising more than 60,000 ounces of gold Indicated, plus a further 123,500 ounces of gold in the Inferred classification, the total deposit suitable for open pit extraction is already attractive. However, portions of this area do not yet have enough supporting data to include within a defined resource. As more work is completed however, this may provide additional evidence to upgrade that estimated gold endowment further.

Of the total strike length currently outlined for this system, about 275 meters has already been stripped of surface overburden. This is important because waste rock in the sample would have the effect to lower the average grade and distort the results. Four areas of the Discovery Veins deposit have been selected for preliminary blasting to proceed. Thereafter, sampling and assaying will be completed to verify that the selected areas are within attractive gold grades to make processing and recovery worthwhile.

A program of infill drilling is also planned, with the objective to upgrade drill density and further improve the accuracy of the estimated gold resource. Ideally, this work enables gold resources to be calculated for the ‘gap zones’ between other intervals. Step out drilling will also advance further along strike to the West of the established deposit area. Again, the expectation is to prove up new discovery zones and increase the total defined resources. The drilling work is expected to commence next week. Renforth is prepared to adjust the planned targets on the fly to react to any intriguing results that may be outlined as the work progresses.

Conclusion

The rapidly advancing work programs at New Alger are contributing to shareholder value. Shares of Renforth reached a new 52-week high this week. The entire precious metals sector appears to be warming up in a new bull market. Money flow is starting to return to the junior explorers and microcap stories. If the positive trend continues, it will provide a tailwind for active explorers like Renforth to continue funding aggressive work programs. The higher share price will also reduce the dilution of the capital structure. Renforth may issue fewer shares for the same dollar amount in a future placement.

Renforth is an explorer that came out of nowhere in terms of how quickly New Alger has been advanced. As an entirely new deposit zone, the Discovery Veins target has progressed from a Brownfields prospect to where it is currently featured with a compliant gold resource. The proposed pit shell currently outlined is another indication of development potential. The bulk sampling program, with subsequent validation of grade and gold recovery performance, is now at hand. Just a handful of exploration projects manage to achieve this stage. Often the endeavor requires many years of work and several millions of dollars in project spending. Renforth has delivered this success in what amounts to the blink of an eye. And New Alger is just one of six highly prospective properties controlled by the Company. Smallcaps Recommendation: BUY.

Smallcaps.us Advice: BuyPrice Target: $0.19Latest Company Report (pdf)
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