Gold mine developer Contango Holdings reports that a National Instrument 43-101 independent technical report has confirmed the potential for two-million ounces of gold at its Garalo project in the Sikasso region of southern Mali.
The report also finds that the two target zones – G1 and G3 targets – extend to the recently acquired Ntiela licence, and that numerous additional targets were also found that require further exploration.
The gold structures confirmed at Garalo are identical to structures that control the nearby 2.8-million-ounce Kalana gold deposit, which is operated by Endeavour Mining.
Contango CEO Carl Esprey says Garalo has surpassed expectations with this independent technical report. “Acquired less than six months ago, with just a historic target of 320 000 oz, Garalo has very quickly turned into something far larger, with every possibility of rivalling some of its neighbours in this globally significant gold-producing region.”
Going forward, Contango is undertaking an accelerated development schedule, targeting first gold in the fourth quarter of the year and in conjunction with expansion drilling.
The miner also notes that there is further upside from the contiguous 100 km2 Ntiela gold project with the extension of at least two target zones from Garalo to Ntiela.
He adds that the recent acquisition of the Ntiela gold project, on which recent work has identified the extension of at least two target zones from Garalo to Ntiela, offers further material upside.
“With a resource of two-million ounces now being contemplated at Garalo and the probability of additional resource ounces being delineated at Ntiela with sufficient drilling, our future billing as a midtier gold producer becomes very credible.”
However, Esprey notes that Contango’s immediate focus remains on near-term cash flow. “We are accelerating the development of a 30 000 oz/y heap leach operation from the shallow oxides given the high margins and low capex for its development.”
Given the significant findings in the report, he says Contango in due course, will undertake further drilling programmes on both Garalo and Ntiela, designed to realise and enhance the asset’s full potential, as the miner looks to establish a large standalone gold mine with multiple openpit operations across both permit areas.
“With production, construction and exploration news flow expected on these gold assets in 2021, as well as further progress across the broader Contango portfolio, we expect to generate substantial value for our shareholders over the coming months,” concludes Esprey.