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Fortitude Gold reports new intercepts at Golden Mile in Nevada


Shares in US gold miner Fortitude Gold [OTCQB:FTCO] were up over 6% on the back of its latest set of results, along with news of new intercepts from its Golden Mile property, where it is exploring in Colorado. Fortitude confirmed this week high-grade intercepts including 3.05 meters grading 16.80 grams per tonne gold within 12.19 meters grading 4.86 g/t gold at the Golden Mile site.

Fortitude Gold released an initial mineral resource for its Golden Mile property in November 2021, which included 78,500 ounces at a 1.13 g/t gold grade in the indicated category, and 84,500 ounces at a 1.10 g/t gold grade in the inferred category.

Fortitude Gold is a US based gold producer targeting projects with low operating costs, high margins, and strong returns on capital. Its strategy is to grow organically, remain debt-free and distribute substantial dividends. Fortitude’s Nevada Mining Unit consists of five high-grade gold properties located in the Walker Lane Mineral Belt and a sixth high-grade gold property in west central Nevada.

Ongoing drill program at Golden Mile property

During the first half of 2022, Fortitude Gold released 51 reverse circulation drill results focused on both infill and expansion drilling at Golden Mile. The five holes released yesterday build on the 2022 prior drill programs.

These drill holes mainly focused on the southeast margin of the current phase one pit shell where exploration drilling encountered high-grade gold, including 3.05 meters of 16.80 g/t gold within 12.19 meters of 4.86 g/t gold among other high grade gold results.

Due to the location of these drill results near the margins of the pit shell, management has decided to push back the cut-off date to include these and potentially additional future nearby drill results into the maiden reserve.

“We still target a Golden Mile prefeasibility by year-end; however, drill results and timing could push completion to early 2023,” said Barry Devlin, VP for exploration at Fortitude Gold. “We believe the additional drilling could lead to a significantly improved mine plan.”

Fortitude reports $24m net sales, $40m cash

Earlier this week Fortitude Gold reported results for the second quarter ended June 30, 2022, including $24.0 million net sales, $6.6 million net income or $0.27 per share, and a $40.7 million cash balance at quarter end. The miner confirmed it produced 10,980 ounces of gold and said it maintains its 2022 production outlook.

“Our Isabella Pearl operations delivered another solid quarter,” explained Jason Reid, CEO and President of Fortitude Gold. “This included focusing on the high-grade Pearl zone during the second quarter with less of a strip ratio. We are beginning to enjoy the benefits of moving substantially less waste at the Isabella Pearl mine, which translates directly to lower mining costs.”

Fortitude Gold increased its cash position to over $40 million at the end of the quarter, which is after investing $2.4 million into exploration and distributing over $2.9 million to shareholders in dividends. Reid said he believed this balanced approach will allow the company to fund its next targeted mine build at Golden Mile, continue an aggressive exploration program on several of its properties, while continuing the distribution of monthly dividends to shareholders with an industry leading dividend yield.

It is that dividend yield that has provide particularly attractive for longer term investors in the stock, which currently remains accessible via the OTC market.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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