In a previous article we discussed the resignation of Strathcona Mineral Services Ltd., one of the companies dealing with Pretium Resource's (PVG) bulk sample update. Then we detailed a bit about the disagreement they had with that Snowden Mining Industry Consultants ("Snowden") (the other independent qualified party). Finally, we covered their previous news release wherein they showed that their bulk sample had surpassed 4,000 ounces of gold in a little over 8,000 tonnes, which rocketed the stock by 80% in that single day as it proved many of the naysayers and shorts wrong.
Today, Pretium Resources issued the completed program results for the 10,000 tonne program and they are shown in the table below:
(Click to enlarge)
What Surprised Us About These Results
What this shows is that the company processed 10,302 tonnes of ore and produced 5,865 ounces of gold and 4,950 ounces of silver. That works out to about 17.7 grams of gold per tonne, and about 14.94 grams of silver per tonne - which makes these exceptionally high-grade gold results.
Additionally, and much to our surprise, the company's results in the last 2,000 tonnes were actually BETTER than those that were previously issued for the first 8,000 tonnes - we expected grades to drop but they actually increased. In the first 8,000 tonnes of the bulk sample the company averaged about 16.2 grams per tonne, while this sample brought that whole average up to 17.7 grams per tonne.
That means that the last 2,212 tonnes of bulk sample produced 1,650 ounces of gold for a calculated gold grade of 23.2 grams per tonne. We expected the company to produce a grade less than the outstanding grade observed in the first 8,000 tonnes but they actually produced a much higher grade - excellent results indeed!
Conclusion for Investors
The bulk sample results is strong evidence that the Brucejack has the potential (and in geology it is always potential until the ore has been mined and processed) to be one of the highest grade projects in the world. Additionally, since it's located in Canada, it is in a safe and reliable jurisdiction, which adds to its allure and attractiveness to potential acquirers.
To give investors an idea of how rare high grade projects are, the folks at Visual Capitalist have produced this excellent infographic showing the top ten mines in the world by grade.
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Source: Visual Capitalist
As investors can see, Brucejack's results would put it in the top five mines in the world in terms of grade. Throw in the estimated reserves of over 7 million ounces of gold, and it would be a standout amongst even this list of exceptional mines.
There's still much to be done on the Brucejack project, but Pretium Resources has shown some exceptionally strong results from Brucejack that have the potential to make this one of the handful of large, high-grade gold projects in the world, which is also located in a safe jurisdiction. This is the type of project that majors such as Goldcorp (GG) and Barrick Gold (ABX) salivate over, and investors should seriously consider owning shares in Pretium Resources.
Disclosure: I am long PVG, GG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
