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Nevada-based gold miner Fortitude Gold Corp. (OTCQB: FTCO) is close to making a development decision on its Golden Mile property in Nevada after the second round of resource definition and expansion drilling returned strong results.

The drilling campaign at the property situated in Nevada’s Mineral County shows high-grade intercepts including 6.10 meters grading 3.10 grams per tonne of gold within 21.34 meters grading 1.79g/t gold and 15.24 meters grading 1.81 g/t gold. The results cover mainly infill and step-down holes and will form a part of the updated pre-feasibility study for Golden Mile which is due to be completed by the end of this year.

“Golden Mile continues to deliver exciting drill results including 21 meters, or almost 70 feet, of 1.79 grams per tonne gold,” said Fortitude Gold’s CEO and President Jason Reid. “We believe we are close to making an official development decision at Golden Mile and look forward to building our second mine in arguably the world’s premier mining jurisdiction.”

The mining company has received permits from the Bureau of Land Management to test the mineralized extensions trending beyond the patented claims and is currently drilling in this area. It plans to continue drilling at Golden Mile for the foreseeable future with an increased focus on additional step-out drilling to the southeast.

“If the current mineralization is expanded further the results of the drilling will not be included in this year’s pre-feasibility study but will be integrated into a future reserve or resource,” said Barry Devlin, Vice President of Exploration for Fortitude Gold.

Fortitude Gold moving nearer to Golden Mile decision

The company previously filed a Plan of Operations with the BLM and anticipates permitting an open-pit heap leach operation as it moves closer to a Golden Mile development decision.

Fortitude Gold’s Nevada Mining Unit is operating in one of the world’s most mining-friendly jurisdictions. There it holds five high-grade gold properties in the Walker Lane Mineral Belt and a sixth high-grade gold property in west-central Nevada. The Isabella Pearl gold mine which sits in the Isabella Pearl mineralized trend is currently in production.

Fortitude Gold Golden Mile

Record levels of gold output in 2021

Its gold output hit record levels in 2021 and the company sold around 45,890 ounces of gold at an average sales price of $1,795. The annual average for 2022 is likely to be higher as the war in Ukraine pushed gold prices significantly higher in March and April, nudging them above the $2,000/oz mark. Although gold has since come down, in a year-on-year comparison gold is still trading above the 2021 levels.

Net sales in the first quarter of this year reached $15.4 million and net income stood at $2.6m, or $0.11 per share, setting a strong tone for the rest of the year. The company expects to produce a total of between 36,000 and 40,000 ounces of gold this year

Fortitude Gold’s strategy is to grow organically and remain free of debt and consequently the projects it tends to focus on have low operating costs while generating high margins and strong returns on capital. In addition, the company is currently paying shareholders a monthly dividend of $0.04 per common share.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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