Blackham Resources (ASX:BLK) shares have been on a tear in 2016 with a 61% gain, closing yesterday at $0.355.
Blackham has a clear strategy to become Western Australia's next +100,000 gold ounce per annum producer, with production to commence mid-2016 from oxides and high grade free milling reefs.
The plan includes a low risk start up with soft free milling ore will be used to repay debt, while exploration continues on high grade reefs and base load ore.
Currently the company has a 4.7 million gold ounce resource and a 780 square kilometre footprint in Australia's biggest gold belt.
The game-changer for Blackham is its 1.3 million tonne per annum plant and associated infrastructure, which is the key to unlocking the value from the company's Matilda Gold Project.
There is a huge opportunity of the Wiluna sulphides resource of 3.3 million ounces at 4.6g/t gold, as the PFS demonstrated East West sulphides are economic at an all-in-sustaining-cost of
With gold in Australian Dollars just shy of A$1600 an ounce, the metrics are compelling.
Drilling underway
Blackham is currently drilling a 4500 metre reverse circulation program at the Matilda Mine to upgrade Inferred lodes to Indicated as identified within the DFS pit optimisation.
Drilling is also as targeting further repeating and stacked lodes along the 7 kilometres of strike.
Analysis
Blackham remains one of Proactive Investors top gold picks for 2016.
On January 19 we wrote:
"With the Blackham share price at $0.24, market cap. of circa A$50 million; this still underscores the mis-pricing of the stock.
"We expect the Blackham share price climb to accelerate in the lead up to plant recommissioning."
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