The well-funded YTC Resources (ASX: YTC) has again extended the mineralised zone at the Nymagee joint venture (YTC 95%) after intersecting strong copper-gold / lead-zinc-silver zones at Nymagee North.
NMD078 was drilled 40 metres north of the previous most northern-most drill hole and was designed to test the extension of strong poly-metallic intersections recently discovered by YTC.
- 9 metres at 1.0g/t gold, 25g/t silver, 0.8% copper, 0.5% lead and 0.9% zinc from 518 metres; and
- 2 metres at 90g/t silver, 6.3% lead and 12.1% zinc from 539 metres.
Rimas Kairaitis, managing director, commented: "Drilling continues to extend the Hera deposit and provide continued encouragement at Nymagee North.
"Our exploration programmes continue to demonstrate the potential for mine life to be extended through further drilling below and along strike of the existing resources defined at the Hera and Nymagee deposits."
This new intersection is located 550 metres north of the Nymagee Resource, and importantly demonstrates that the mineral system remains open to the north.
Nymagee has a resource of: 8.1 million tonnes at 1.2% copper, 0.3% lead, 0.7% zinc and 9g/t silver.
NMD081 has also been completed which intersected strong iron-sulphides from 560 metres to 629 metres with minor base metal sulphides.
Nymagee North continues to return strong base metal intersections with precious metal credits, and YTC remains of the view that the Nymagee North mineralisation recently discovered potentially represents the upper part of a new mineral deposit.
YTC has also cased selected holes preparation for further downhole EM (DHEM) and follow up drilling, and is also currently completing deeper exploration holes between the main Nymagee deposit and Nymagee North, as well as below the Nymagee deposit itself.
Across at Hera, follow-up drilling at Hera North has intersected a 4 metre zone of high grade, semi massive lead-zinc mineralisation 40 metres above the strong results previously reported for holes HRD042, 42W1 and 42W2.
Assays for this hole are currently pending.
Hera is a near-term high-grade gold-lead-zinc-silver development, with project financing pending and operating costs of A$395/ounce (after Pb-Zn credits).
YTC is very well-funded with $12.6 million in cash at the end of the September 2012 quarter.
With the market cap. pushing $70 million - the company has an enterprise value of just $57 million.
The recent Hera DFS confirmed the project as being a financially and technically robust project as Stage 1, which includes over $510 million in revenue in this stage alone - with operating costs of A$395/oz (after Pb-Zn credits).
The Net Revenue (pre tax profit) breakdown is; $94.8 million (gold = A$1450/oz) and $152 million (gold = A$1750/oz).
Now once the nearby Nymagee project is added to the YTC portfolio, then the company's enterprise value of sub-$60 million appears even lower.
There are significant near term milestones and catalysts to move the current share price of $0.27, which include outcomes from advanced negotiations on project funding as well as drilling of new targets at Nymagee.
With the strong cash position YTC is funded to advance these milestones.
Proactive Investors is of the opinion that on its current resource and milestones - YTC's valuation should be closer to $0.35-$40 - with the current price showing that the stock has been oversold.
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